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While you might have the technical expertise and marketing prowess to build a successful small business, managing the books is difficult for most entrepreneurs. Unfortunately, bookkeeping only grows more complex as your business expands, so keeping operations streamlined and organized can become extremely difficult. Here’s what to know to keep your books under control.

How to Manage Bookkeeping for a Small Business

1. Keep Personal & Business Accounts Separate

Mixing your business and personal finances may seem simpler, especially if you’re a sole proprietor without any employees. However, this can make preparing your taxes extremely difficult and may even trigger an IRS audit.

As soon as you have the paperwork, open a business bank account and separate your finances. A separate company account makes it easier to keep an eye on growth, track deductible purchases, and establish a budget for your business.

2. Use Automated Software

bookkeepingEntering sales figures into a spreadsheet and making calculations yourself can consume hours of your work life every week, which you could be spending on more profitable projects. Fortunately, many companies offer cloud-based bookkeeping software accounting programs that can automate many of these tasks. You can even sync the program with your business bank account, allowing it to automatically extract the necessary data.

3. Create an Organizational System

Developing a clear picture of your company’s finances means keeping track of invoices, receipts, and financial reports. Having these documents organized allows fast and easy access if you’re audited or discover a discrepancy in the books.

Many business owners prefer digital storage solutions to create an organizational system that divides documents by type and keeps them in chronological order. For extra safety, consider keeping backups in the cloud where they can be retrieved if your computer fails.

 

If you’re running a small business, outsourcing your bookkeeping needs to an experienced professional saves time and ensures that your records are always accurate. For nearly 20 years, Joe Heard, CPA, has helped entrepreneurs throughout Checotah, OK, manage their finances. To discuss your bookkeeping needs with a member of their team, visit their website or call (918) 473-1492.

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