Opening a business allows you to make money doing what you do best, but it also means taking on several other roles that might be outside your areas of expertise. Bookkeeping, for instance, is crucial for keeping an eye on your cash flow and tracking expenses, but many new business owners aren’t sure where to begin. The do's and don’ts below will help you stay on top of your finances and avoid common mistakes.

Do:

Keep your business accounts separate.

Mixing your personal accounts and business income can easily cause confusion and might trigger audits from the IRS. Keeping track of your company’s financial health will be much easier if you keep your business earnings separate, even if you’re registered as a sole proprietor or LLC.

Keep old paperwork.

When cleaning out your office, you might be tempted to toss out old invoices, receipts, or other paperwork. However, you should keep all financial records for at least six years, or even longer in some cases. Without them, you might find yourself facing stiff fines and tax penalties if you’re ever audited by the IRS.

Don’t:

Neglect your books.

Bookkeeping can take hours every week, which can be easy to put off when you have a thousand tasks competing for your attention. However, letting it pile up can make it impossible to get a clear perspective on your financial state, which could lead to serious mistakes.

Hesitate to hire help.

Money might be tight when you’re getting a new business off the ground, but investing in a professional bookkeeping service is almost always worth it. The best providers will generate monthly reports, prepare financial projections, and take the books off your hands so you can concentrate on running your business.

As one of Texarkana’s premier accounting firms, Erie & Associates has years of experience helping business owners throughout Bowie County, TX, keep an eye on their finances. Their broad range of services includes everything from basic bookkeeping to full-service accounting and payroll. Visit their website for more on how they can help keep your business’s finances on track, or call (903) 792-6651 to discuss your needs with a professional today.