What is the meaning of BOOKKEEPING?
Bookkeeping is the recording of financial transactions, and is part of the process of accounting in business. Transactions include purchases, sales, receipts, and payments by an individual person or an organization/corporation.
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You need monthly bookkeeping if…
- DIY bookkeeping takes up more time than you can afford
- Don’t take your own time for granted. Not only does overworking lead to burnout, but every minute you spend on a task has a dollar equivalent.
- Your books are never up-to-date
- When you fall behind on bookkeeping, your books stop reflecting the actual state of your finances. That makes it harder (sometimes impossible) to understand cash flow and accurately gauge the health of your business.
- Your accountant does your bookkeeping
- Some entrepreneurs will leave their books untouched over the course of the entire year, then deliver their expenses and bank transcripts to their accountant during tax season, so they can be done retroactively for the sake of filing a return.
- At tax time, you send way too many emails to your accountant
- The financial year ends at midnight, December 31. Whoever does your bookkeeping hands off your financial records for the year to your accountant. Your accountant uses those records to file your taxes. Later, you receive a tax refund.
- You missed out on tax write offs
- Ultimately, an accountant with experience in your industry is most qualified to give you comprehensive guidance regarding tax write-offs. But many business owners only talk to their accountants during tax season. A good bookkeeper who understands your business’s needs can help you out during the rest of the year.
- Your cashflow is unpredictable
- You need cash flow statements. A cash flow statement tells you how much money other people owe you, and how much money you owe other people. It’s kind of like a crystal ball that shows you the future of your bank account.
- Paying estimated tax payments is a pain in the ass
- Significantly underpay your quarterly estimated taxes, and you’ll get saddled with fines from the IRS. Overpay them, and you’re effectively giving the IRS an interest-free loan.
- Sales have increased, but your profits haven’t
- If your revenue is on the rise but your bottom line won’t move, it means you need to increase your profit margins. Tax-ready financial statements from a bookkeeper can help you recognize where you need to cut costs in order to make your business more profitable.
- You have had security problems with your computer
- When you use your own computer to track and store financial information, you need to be 100% certain that it’s secure and stable.
What are the basic tasks involved in monthly bookkeeping?
- Credit Card and Bank Account Reconciliation.
- Record Individual Credit Card Purchase Transactions.
- Maintain Vendor W-9 Information.
- Create Collections Process.
- Process Use Tax.
- Prepare Sales Tax Return.
What is the most important aspect of monthly bookkeeping?
The most important aspect of bookkeeping is to keep an accurate account of all records and keep them up to date. Accuracy is the most vital part of the bookkeeping process.
Here is How I Can Help…
Availability
You need to be able to contact your bookkeeper quickly and get a helpful response. If your bookkeeper takes their sweet time responding to emails, or goes on vacation without giving you notice in advance, it’s time to consider switching services.
Clear, easy communication
Bookkeepers need to be bilingual: able to speak with accountants and other bookkeepers, and able to speak with the rest of the world. Conversations should never be so loaded down with jargon that you can’t understand what’s going on. Make sure you work with a bookkeeper who is able—and willing—to explain your books to you in a language you understand.
Tax-ready financial statements
One of the greatest boons of working with pro is receiving up-to-date financial statements you can use to plan business moves or prepare your taxes. If your bookkeeper can’t deliver, it’s a sign you need to find a different solution.
High-security standards
The best bookkeeper in the world is totally useless if their computer—and your business’s financial data—is taken offline by an attack. Your bookkeeper should be able to confirm they have security essentials in place.
If COVID got you messed up this last year and you don’t know where to start with your finances, I have a very affordable option for you (because you should always be growing and learning so that you can thrive) … Fiercely Financial Facebook Group where I do group coaching in a nonjudgmental environment. Check it out and subscribe today so you can be ready for whatever 2021 has to offer!