As I was reflecting about the year that is about to end, setting up goals for the New Year and coming up with a decent action plan, I thought about many business owners who are in a deep mess with their bookkeeping. Then, I thought what I could offer today that would help some of you who have no idea where to start.
Depending where you are financially outsourcing this task to a professional to clean up the mess and bring your books up to date is the way to go. Then, make an effort to follow a system to collect all documents so you don’t miss any tax deduction.
How can you do that starting year 2016?
Here are 8 tips to get on top of your numbers on a monthly basis:
1) Choose one credit card for business purposes and have a folder to collect all receipts and statements.
2) Have a folder to collect all receipts and statements from you business bank account. If you are sole proprietor and do not have a business account, open a separate one as soon as possible.
3) Have a folder to collect all mail.
4) Have a folder to collect contracts. If you have a line of credit or other credit cards, have a folder for those accounts as well.
5) Every day you come across mail, or have a few receipts, put them in the appropriate folder. It is important to put your receipts from the oldest to the newest date. When you have the statement, it will be easier to reconcile it.
6) Once a week, have a date with your money. Go over all mail, pay bills, and move contracts and any other important documents to a temporary folder wherever you keep it. Also, keep your office space uncluttered of junk mail or paper that you do not have any intention to deal with at all.
7) I strongly advise you to do the data entry on a weekly basis but not many people like or will do that. How about once a month by the 5th?
8) Once you accomplish this task, you can produce a few reports that will help you get a clear picture of where you are.
I am sure many of you are setting up goals and why note include taking care of your books closely? Knowing your numbers is crucial to reach your goals. The other benefits you will have are detecting fraudulent transactions, overdue invoices from clients, making informed business decisions and acting upon it.
Take charge of your future and the possibilities are limitless.
Reflect about all challenges and victories you had in 2015 and what you learned from each one, set new goals, come up with an action plan that is congruent with your personality and the results will be rewarding.
Happy New Year!
“Reduce risks, pay on time, be efficient and save money and time” Renata Magalhaes