3 Avenues Business Owners Can Utilize for Recordkeeping
In our last blog, we discussed why business owners should prioritize their recordkeeping. You can utilize many avenues for your recordkeeping, from a simple do-it-yourself spreadsheet to your choice of app to an online system that you can insource or outsource. Regardless of your tool of choice, keeping good records in business is a must.
Excel spreadsheets are used to keep a record of a business’s income and expenses. Although it is more manual than other methods, it is effective and is a good place to start. As a business owner, it is wise to develop a habit of entering items into the spreadsheet as they occur. Doing so will help you maintain up-to-date records of both your income and expenses. When using spreadsheets for recordkeeping, ensure that you can substantiate all entries if ever an audit is needed.
There are several things you can and should record on a spreadsheet, and income is one of them. It can seem like a daunting task, which is why we recommend keeping it as simple as possible. Fees and payments received for services rendered or products sold, commissions collected, etc. are some examples of income listed on an excel spreadsheet. When doing so, notate the transaction’s specifics such as date, client name, services provided, invoice number, dollar amount before and after taxes, and a total.
When recording expenses, the same principle applies, simple is best. Some examples of costs are those associated with utilizing your home as an office space. You can enter things like utilities, supplies, subscriptions, and more into the spreadsheet. Ensure that you are using descriptive words that are readily identifiable for tax purposes, as you may need to refer to your spreadsheets at that time. This task is a very needful and necessary one. Therefore, as a business owner, from this day forward, become intentional about making recordkeeping a daily priority. Before you know it, you will have developed a healthy habit and desire to get it done. However, we know that entering things manually into a spreadsheet can be time consuming so as you grow, consider moving on to the other suggestions below.
The business owner who looks for tools that offer ease of use and accessibility, Wave, FreshBooks, and QuickBooks (QB) Self-employed are some of the most top-rated accounting apps. Wave is an easy-to-use cloud-based accounting app with a user-friendly dashboard to help its first-time users navigate their accounts. Some of its features are billing, online payment handling, investment tracking, and automated reporting. With Wave, you can scan expense receipts and consolidate records all while on the go.
FreshBooks is another cloud-based accounting software that many business owners are finding easy to use. One of the features in this app is that it allows you to link your bank and credit card accounts so that your transactions are noted and tracked in the app in real-time. Its automatic categorization features make inputting info less time consuming and calculating taxes simpler.
The QuickBooks Self-employed app, also known as QB Self-employed, is another innovative cloud-based accounting solution. This app has a user-friendly combined interface that allows you to manage invoices, payments, billing, and much more. With QB Self-employed, you can also link accounts to the app to see real time activity, create and edit transaction categories, and enable the business reporting feature to export profit and loss information into an excel spreadsheet or CSV file. This app allows users to store their expenses, vendors, payroll, and more all in one place.
Other Online System & Outsourcing
QuickBooks Online is an online accounting system designed to empower you as the expert you are. Its unique features allow you to cultivate and run your business according to your needs. The tool enhances your ability for growth and training, practice management, and work productivity and allows you to collaborate with clients anywhere at any time. The reports derived from QuickBooks Online include Balance Sheet, Profit & Loss, Cashflow Statement, Accounts Receivable, and so much more. This is the software that we use with our bookkeeping clients and provides the reports information they need to help the business owner to know exactly what is going on in their business and to make better decisions.
To learn how on how we can work with you with QuickBooks Online for your bookkeeping needs, reach out to us and schedule a discovery session here today.