Most people start their own business because they want to do something they have a passion for, be their own boss, and make a lot of money. Those are great aspirations to have but it’s also important to keep in mind that every business has a number of administrative responsibilities that aren’t as glamorous.
One of those responsibilities is bookkeeping or the practice of keeping accurate records of your business’s finances. Here are a few examples of what gets recorded in a business’s books :
- Daily, weekly, and monthly sales
- Invoices sent to customers
- Invoices/bills received from suppliers and vendors
- Staff hours and wages for payroll
- Expense receipts
These are only a few basic examples of what goes into bookkeeping. You’ll likely track and record other information, depending on what your business does and how it operates. And you’ll need to make sure everything is categorized correctly and perform bank reconciliation on a regular-basis.
In an ideal world, you’ll attend to your books daily. You can record and organize your sales from the day, reconcile the transactions that have cleared your bank account, and update your employees' hours for the week. Neglecting the responsibility for even a few days at a time can not only cause the bookkeeping work to pile up. It can also cause you to lose touch with your business’s financial health and potentially lead to problems, like overdue bills or not having payroll ready by payday.
But most business owners realistically cannot do bookkeeping everyday and probably don’t want to. The solution is to hire a professional bookkeeper to handle the responsibility for you. You’ll be able to rest assured that your books are being managed by an experienced professional who can also advise you on financial best practices.
When should you hire a bookkeeper?
The sooner the better. It’s a good idea to have a professional on board when your business launches and money starts to be earned and spent.
Otherwise, you could end up with several months worth of transactions for your new bookkeeper to record, categorize, and reconcile. And you’ll likely have trouble remembering some details they’ll need to know.
For example, they may ask you “What was this train ticket for? What client did you visit on October 5th and why?” They’ll need to know this so they can correctly categorize the expense. But if you waited until May to hire them, you’ll probably have forgotten about your early October train ride.
The takeaway is to not wait too long to hire a bookkeeper. You always want to have a solid understanding of where your business is at financially and the right bookkeeper can give you that insight.
How do you find the right bookkeeper?
You have plenty of choices in who you hire to handle your books. Traditionally, you would hire a local bookkeeper who serves many different businesses in your community.
However, local is no longer a requirement. Modern bookkeeping software is hosted in the cloud, meaning it’s accessible through the internet instead of a single desktop computer. This means you can partner with a bookkeeper located anywhere that meets your specific needs.
It’s a good idea to seek a bookkeeper who is a specialist in your industry. They’ll understand how your business operates and provide expert advice, like what technology to implement and tax deductions to consider.
The right bookkeeper can help your business reach its full potential. So make sure you trust and believe in whoever you hire.
BookKeeping Express (BKE) provides accounting and bookkeeping services to a variety of businesses. We serve restaurants, home service contractors, professional service providers, health and wellness businesses, and multi-unit businesses and franchises. Contact us today to learn how we can help you better manage your books.