If you are a small business owner, it won’t take long after establishing your business to realize, that bookkeeping services for small business is easily one of the most essential aspects of running a business. If your bookkeeping service is poor, then it is far easier for your entire endeavor to crash and burn — or, at least, to face major financial complications.
As excited as you are about lifting your small business off the ground, it can be easy to neglect or even overlook bookkeeping. It might seem like a secondary detail, rather than a necessity to each and every business. If you neglect bookkeeping from the very inception of your company, then you are essentially setting yourself up for failure.
What Transactions Are Accounted for During Bookkeeping?
In order for your small business to have good bookkeeping, it is important that you understand what you will need to keep records of. High quality bookkeeping for small business, or really ANY businss, should consider:
- Sales
- Purchases
- Earnings
- Receipts
- Payments
In order for bookkeeping to be at its most useful, it will need to be as comprehensive as possible. You should be able to account for all the funds that are flowing in and out of your small business. If there are gaps in this understanding, issues will be more prone to arise, down the line.
The Consequences of Poor Bookkeeping
Again, bad bookkeeping can take a serious toll on the wellbeing of someone’s small business. Still, more specifically, what does this effect even look like? If your small business bookkeeping practices aren’t the best, then what can you expect to happen to your business?
If your business is ever audited by the IRS, then bad bookkeeping practices can lead to failure. If you ever lose an audit issued by the IRS, your small business can expect to face heavy fines. Sometimes, these fines will be enough to permanently damage a business’s operations, possibly leading to its closure.
Additionally, if the money flow of your business isn’t flowing, then there’s a good chance that you’ll encounter cash flow crunches, seeing as your business will no longer be able to effectively operate.
In general, poor business and financial planning can make it far easier for you to lose your small business. Good bookkeeping is a necessity, as it allows you to know whether your business is stagnant, growing, or on a decline. With bad bookkeeping, all of these factors will be unclear to you.
Get Your Small Business’s Bookkeeping Back on Track
Even if your small business doesn’t have the best bookkeeping practices, then hope isn’t necessarily lost. It’s possible for you to take action now, in order to catch-up and improve your future bookkeeping habits.
If you continuously struggle with bookkeeping, then it could be a wise decision to begin outsourcing. This will allow you to focus on the other aspects of running your business, without having to stress about bookkeeping.
Another way to get back on track is to do catch-up bookkeeping. If you’ve been ignoring or neglecting your company’s books, it’s still possible to go back and catch-up on what you have missed. Although this is a hassle, it will be worth the extra effort, in the end.
One Books Helps Run Your Business
Approximately half of all small businesses fail within the first five years — this is why it is so important to stay on top of practices like bookkeeping, in order to reduce the chances of this happening to you.
The skilled bookkeepers at One Books are available to help your small business stay on top of its books and if you fall behind they are expert at catchup bookkeeping. Don’t continue to neglect your monthly bookkeeping. For more information, simply contact us through our online form.
