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The Four Basics of Bookkeeping

Though technology has revolutionised the way bookkeeping is done, that doesn’t necessarily mean that technology and software do all the work for you – someone still has to organise, input, track and check the data to make sure that everything is correct.

Even if your startup doesn’t have the budget currently to hire a full-time or outsourced accountant or bookkeeping person, that doesn’t mean bookkeeping should be put on the backburner. Find a system that works for you (we recommend our software, which is designed specifically for small businesses), set some time aside each week and follow these tips to keep your own books while you get your business off the ground.

It’s All About Organisation

Whether you’re using software or an Excel spreadsheet, the most important aspect of bookkeeping is staying organised. Keep meticulous track of business expenses, employee expenses, operating costs, sales, and cash flow. Though it can be tedious work, it’s a task that’s critical to the health of your company and is worth the tedium.

Accurate Data Entry is Key [restrict]

No matter who on your team is handling the data entry, be it yourself, a senior management member or an intern, they shouldn’t be zoning out or lazily entering data into your bookkeeping system. It’s imperative that the data is accurate, and it needs to be stressed that they should be double-checking their own work to ensure there are no mistakes or errors.

Double-check the Data

Even if the person entering data is trustworthy and has great at attention to detail, the data should still be checked by another person, just in case. It may feel like a waste of time, but if that second pair of eyes catches even just one tiny mistake, it’s worth the time and effort.

Be Disciplined

Keeping your books up-to-date and accurate requires discipline and commitment. Set up a block of time each week to enter and/or review the data and create an organisational system and workflow that works for you and your team. Then stick to it – though there will likely be urgent tasks or situations that arise, don’t get in the habit of letting bookkeeping be the item on your to-do list that always the lowest priority. Even if you do push it to another day or time, be sure to come back to it so that the work doesn’t pile up for weeks on end.

By staying on top of the bookkeeping work, you’ll not only have a great understanding of your business’s finances and costs, but will have a new appreciation of the work professional bookkeepers and accountants do – which will make hiring one that much sweeter when the time comes.

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This article was contributed by micro/small business solutions provider Financio. 

Financio, a product of ABSS, brings small business accounting automation to Singapore and other countries, redefining how small business owners handle accounting and tax tasks, bringing accounting software to the next level.

Find out more about Financio and branded accounting software and their wide range of products and services here.

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