Bookkeeping can be a breeze when you create a system that works for you and your business.
Despite this, many seem to dread dealing with their accounts, often putting them at the back of their mind until tax deadlines rear their ugly heads.
We believe that by regularly maintaining your books, you can not only avoid unnecessary stress but also learn more about your business in order to drive it forward.
Today, we’ve come up with some tips on how to practice a quality bookkeeping system.
Make a start.
The first step you must take is to organise any pre-existing documents or paperwork. This includes invoices, bank statements, bills, expense receipts and tax documents.
Now is also a great time to decide how you’d like to operate and keep your books going forward.
Are you going to choose a paper system, where everything is stored in files and folders?
Or, are you going to invest in digital accounting software?
Personally, we would recommend going digital. Brands such as QuickBooks, FreeAgent and Xero, offer an efficient and easy way to manage finances. Plus, the way we communicate with HMRC is becoming increasingly digital, so it makes sense to make the transition now.
Set aside time.
We understand that you are already extremely busy running your business, with little time to spare for anything else.
However, by blocking out an hour a week to stay on top of your books, you can save yourself a headache later on in the year.
It’s hard to break off from what you’re doing, especially if it’s for a client or customer. So, make sure you set an alarm to remind you, or even get a friend or colleague to check up on your progress.
A helpful way to get into the habit is to attach it to a pre-existing task you already regularly do. For example, if you respond to emails after Friday lunchtime, schedule in an hour 2pm – 3pm to keep up with your books.
Design a process.
Time is frequently wasted when you come to start a task and have no real direction of what to do.
Avoid this by setting out exactly what you need to do within that hour so that you can get cracking right away.
- Send invoices to customers.
- Check bank statements.
- Pay supplier bills.
- File any outstanding expense receipts.
Stick to it.
Creating a great bookkeeping system requires consistency, and there are several ways you can incorporate it into your monthly routine.
As we’ve already mentioned, set aside time in your diary or calendar – whatever tool you use to stay organised.
Another way to encourage yourself and reinforce the habit is by thinking about a reward. Being in-the-know when it comes to your business’ finances is a good feeling and you can often learn something new about how you operate from reviewing things like cash flow, prices and statements.
If this isn’t enough of an incentive, you could treat yourself to a nice drink in your favourite coffee spot when organising your books. Or, even put aside some money each week to treat yourself to something you can look forward to.
If you would like any more advice on how to bookkeep, please contact a member of the VSP team today – we’d be happy to help.