If you run a business in Perth, you should make a conscious effort to keep an eye on your finances. This is because this Australian city is a centre of commerce and industry. With a population of over 2 million people, Perth is a huge market for goods and services in Western Australia. It follows that if you run a successful business here, you might be too busy making money to keep an eye on your finances. Below are smart bookkeeping tips to make life easier for you.
Use Accounting Software
This is the age of paperless, cloud-based accounting. As a business owner, you should take advantage of this and install the right accounting software for convenience and speed. You can even use this software to keep track of debit and credit transactions. Just invoice your customers and send an email immediately. This makes it easy for you to collect payments and keep records.
Separate Personal and Business Finances
If you run a small business, you should separate your personal finances from your business finances. This is a smart move because it helps you get a clear picture of what is doing on in the business. For start, you should have a separate account for your business. Place yourself on a salary and try live within your means. If you borrow money from the business, you should repay the loan as soon as you can. This is vital because without cash flow, your small business will not grow.
Bookkeeping is all about keeping records and monitoring your finances. You should have accurate records of all the cash that comes into the business. It is also important to record any money you spend. At the end of the day, you reconcile your account so that you know exactly what your profit and loss position is. Apart from keeping daily records, you should reconcile bank accounts monthly.
Plan for Major Expenses
Cash flow is the lifeblood of every business. You should always plan for both major and minor expenses. This ensures that you do not run out of cash for your daily operations. Note that there is a strong connection between time and money. You should plan your expenses so that you have access to your operating capital when you need it.
Invest in Data Entry Software
This is the internet era so it is likely you will be doing business online. For this reason, you should invest in data entry software and other programmes that will make things convenient for your business.
Finally, you should put money aside for your taxes and pay close attention to your invoices. These are the bookkeeping tips I use in my small business. Try them and they will work for you.