5 Bookkeeping Habits Savvy Business Owners Adopt

When you decide to put up a business, the learning process will be never-ending. To some, a surviving business is enough, but without a long-term plan, your company will eventually join those businesses diving in a cesspool of debts. Romanticizing about happily ever after in running a business is not going to get you anywhere unless you develop smart habits that will keep your business thrive.

1. Leave tax returns to bookkeeping professionals

Have you ever found yourself being pulled in different directions to ensure your business do not take a nosedive? There are aspects of your business that you need to leave to professionals and one of which is preparing tax returns. It is important to outsource this task to someone who has the expertise because they are the ones who have trained financial eye. They are also well-versed when it comes to the ins and outs of tax deductions.

2. Understand what is happening with your business

Although you have bookkeepers and accountants to take care of your reports, this does not mean you should go entirely hands-off. You still need to actively participate in reviewing reports. That said, gaining basic understanding of business numbers is essential. Some of the information you should learn include trend in expenses, accounts receivable, profit and profit per customer. 

3. Choose reliable software

In the age of technology, it is imperative for every business owner to bring the right software into business. A good system will enable you to generate reports in minutes and ensure that the reports contain accurate information. Ask for recommendations from friends who have the same businesses as yours.

4. Document essential bookkeeping processes

Aside from gaining basic understanding of business numbers, documenting bookkeeping processes is also the best practice to follow. Noting the processes prevents confusion and answer questions. Once you know how bookkeeping works, it will not be difficult for you to spot errors as you already have an idea what could have gone wrong.

5. Keep receipts

Keeping expense receipts is another good habit a business owner should adopt. It enables you to keep track of your expenses and determine which direction your business is heading. While credit card purchases generate receipts and monthly statements, cash expenses need to be monitored regularly. These days, you can download accounting app that will give you the ability to take pictures of receipts as you go. This will help you track your expenses without keeping the paper copies.

Tamara Deterding

Written by : Tamara Deterding