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How-To Guide: Tips to Improve Your Business Bookkeeping and Accounting

If you want to improve the results for your company, then you need to take it back to the basics by upgrading the systems that influence every aspect of business management. By creating the right foundation with good business bookkeeping and accounting practices, then you can make a difference with the long-term success that is possible. The key is to pay attention to the details and hire the right team to assist with the implementation.

Many business owners have good intentions to improve critical systems, such as financial reporting and accounting details. But, it is common for these activities to fall to the backburner because the attention is focused on immediate needs. It is easy to ignore the stack of paperwork that needs to be addressed when you are spending your time talking to potential customers and business contacts. Instead of procrastinating these efforts, you need to understand the importance of good systems so that these things are pushed to the top of your priority list.

Common Options to Improve Business Bookkeeping and Accounting

Even though you know that your business bookkeeping and accounting systems need to be improved, where should you start? You need to think about the overall system as well as the ongoing tasks that should be addressed on a daily, weekly, and monthly schedule.

Here are a few common practices that need to be considered if you are looking for ways to improve your accounting and bookkeeping:

Practice #1: Common Understanding with Vendors and Business Contacts

It can be a challenge to juggle the invoices that are coming and going when you have different systems in place for business contacts and vendors. For example, are some of your vendors stuck in the old process by sending invoices through the mail? We live in a digital age, which means that hard copies are no longer necessary. There’s no reason why you need to hold onto the paperwork.

Talk to your vendors to see if they offer digital invoicing. Then, make sure that you have the right system in place to keep the files sorted when they come through. For example, all of the invoices should be sent to the same email address. Next, the attachments need to be imported into the accounting system or saved in a cloud storage folder for future reference if needed.

Creating the same system and understanding with all of your business contacts can help to simplify the work that needs to be done in your office. It takes a little bit of effort to systematize this process, but it is worth the long-term benefits that are available.

Practice #2: Identify Bad Practices

Are there any bad habits that are dragging down efficiency or impacting profit margins? You need to evaluate the things that should be changed so that you can work on optimizing processes for the future. Sometimes, it is easy to overlook these bad practices when they become a normal part of your business activities.

The best solution to find the bad practices is to bring in an outside perspective to evaluate the way you are handling your regular activities. For example, important tasks might be falling through the cracks if you aren’t tracking the progress of various projects or invoices. Or an accounting team might help you find unnecessary costs that can be dropped so that you can minimize your overhead expenses.

Even though the changes might seem small, they can have a significant impact on the success of your company in the future. If you want to improve your results, then you need to improve the way you are managing all of the details in your company.

Practice #3: Be Clear about Bookkeeping Duties and Responsibilities

One of the most common reasons why important tasks are overlooked is that people don’t take responsibility for the things that might be handled by another employee. Don’t wait for employees to step up and take ownership for essential tasks, such as reconciling the books or sending invoices. Instead, you need to choose the people who should oversee the task and ensure that everyone takes personal responsibility for the areas where they are assigned.

You might have in-house employees who can help with bookkeeping, invoicing, and more. Or, you might choose to outsource these services so that a professional company takes responsibility for the tasks that need to be completed. It’s up to you to choose the system that will work best for your business. At the same time, be clear about expectations so that employees or contractors take the lead on their responsibilities.

Practice #4: Use the Latest Automation Features

Automation can have a transformational impact on your accounting and bookkeeping practices. If you are stuck in old habits and systems, then right now is the perfect opportunity to make the changes that are long overdue.

We live in a world of technology, which means that you need to be looking for options that fit your industry. There is no reason why your employees should be spending time on tasks that can be automated. For example, some businesses still practice data entry for every transaction that moves through the office. But, often these transactions can be automated by syncing the bank accounts and credit cards with the bookkeeping system.

A good bookkeeping system will pull in the transactions and even set up categories based on your predefined parameters. This automation reduces the need to spend valuable time on busy work. Instead, you can let the system handle the details so that you can focus on other aspects of growing your company.

Practice #5: Managing Inventory and Spending

It is common for businesses to get caught in the trap of overspending and poor management of cash flow. If you are spending too much on inventory and business management, then you will be able to see the trends in the reports. But, if you don’t have a good reporting system in place, then it means that these important details are probably slipping by without the attention they deserve.

Make sure that you always have the right amount of inventory on hand. Even though you want to bring in a large amount of inventory so that you never run out of products that can be sold, you might accidentally burn up your cash flow with products that won’t be sold for a while. So, it is important that you manage your spending by being careful with the amount of inventory that is purchased.

Also, look for other areas where you can reduce overall spending. Can you identify spending patterns that aren’t essential for business growth and management? There are often simple solutions that can be used to reduce overhead costs so that you can minimize your spending and maximize profit margins simultaneously.

Practice #6: Plan for Big Expenses

Even though business might be good right now, you never know when an unexpected expense will pop up. You can’t predict when an emergency might happen. But, you can always expect that something will happen eventually. So, you need to be sure that you are ready with money in the bank when these details need to be addressed.

Upcoming big expenses might be accrued for a variety of reasons, such as tax responsibilities, inventory purchasing, equipment and computers, employee payroll, and more. It takes money to run a business, so you need to think ahead to ensure that you always have the cash flow to keep things rolling. It is wise to have a few months of business expenses set aside as an emergency fund.

This emergency fund can be used for one-time costs that might come along. At the same time, the emergency money can also be helpful to get you through the lean times if things slow down in your industry.

Practice #7: Hire the Industry Experts

There’s no reason why you should reinvent the wheel when industry experts have already created and improved the systems that can be used for business bookkeeping and accounting. If you are looking for the right solutions to improve your company, then you need to turn your attention to the advice offered by the experts.

We’ve been offering these services for many years, giving us the experience and education to know the best ways to maximize the results from accounting and bookkeeping. When you choose our experienced team, you can tap into the knowledge that we will share about the options that are available for your company. As we have helped other small businesses, we’ve gained the knowledge and information required to ensure the long-term results that you deserve.

Why Easier Accounting?

Why should you enlist the services that are offered by our team at Easier Accounting? We know that you have many options for accounting and bookkeeping services. But, our team is working hard to provide the custom results that are best for small businesses and startups. If you are looking for assistance with payroll processing, bookkeeping, tax preparation, and more, then you need to contact us as soon as possible. We are here to help so that you have the best options available for your industry: (888) 620-0770