How to Tackle Your Accounting as a New Business Owner
The core method of keeping your financial data up to date is proper bookkeeping and accounting. Without accurate and up-to-date financial data, you are not able to make informed business decisions. At Accountfully we see the side of the moonlighting as their own bookkeeper all day long. The DIY confidence is at an all-time high as they click “sign up” in the latest accounting software, but quickly dwindles after weeks of trying to maintain the books properly. Once we are in the books and keeping things up to date, the same business owner soon wonders why they even tackled it all in the first place.
If you were ever in doubt about whether or not you should be dabbling in your own accounting, here is your gauge to decide.
Do I Need to Outsource My Bookkeeping?
Here it is, the pivotal FAQ. It’s also a loaded question because it depends on a lot of factors and individual circumstances. The best we can do is help outline some facts and ideas to help you decide what is right for you.
The challenge in modern times is real. The tools exist to create, advertise, and manage a business, but they don’t guarantee accuracy and expert-level management. At the same time, it is important to get to know your business as it develops, and DIY bookkeeping is a great way to do that.
It has never been easier to tackle your own bookkeeping. The systems that exist these days like Intuit QuickBooks Online have relatively inexpensive functions, or versions that can be set up quickly. Before you know it, you are officially handling your . This is all good, but if you are going to commit to doing your own bookkeeping, you will need to start with some best practices, to set things up for success.
Create A System That Works For You To Start Managing Your Own Bookkeeping
A new business means dedicated business account(s) and credit cards, used for that business only. This will simplify all of your transactions and keep them in one place. All outflows and inflows will travel through these accounts, making it a lot cleaner for DIY bookkeeping. You can export transactions from your business accounts and log them in a spreadsheet. This spreadsheet will house information on the transaction itself and allow you to code each.
Not only will this give you the proper, professional tools to get your business management started right, but it will simplify your bookkeeping and minimize confusion across any additional businesses or personal accounts.
Get an Accounting System Set Up and Use it Consistently
We hope your business is so successful that you are quickly outgrowing your manual bank account transaction export and spreadsheet process. This is where that modern accounting software comes in. Once you’re ready to move forward to an accounting system like QuickBooks Online, get that set up. Be warned, setting things up in the app is step one.
Step two is your regular, dedicated process followed to update your information. You will need to ensure that you are spending weekly, dedicated time to being in that App. It can be as simple as every Friday or every Thursday for 30 minutes, you go in, close your bank transactions, pull your credit card transactions, invoice your customers, etc. Without your dedicated time, the App and your bookkeeping endeavors will be rendered useless.
Let Some Time Tell You When It is Time
As you stay consistent with your business process, you will start to get a sense of how burdensome it is for you. Is your time better spent talking to prospective clients or industry influencers? Or is the time in your books well spent because you are getting a better understanding of your cash flow and overall business health?
As a new business owner, we challenge you to actually start doing your own bookkeeping. There are some upsides to doing it yourself, if you are capable.
In addition to monitoring your business health, it does save some of that monthly cost as you are getting off the ground. It also allows you to understand the true value of bookkeeping, once you are ready to outsource it.
So at the end of the day, do you need to outsource your bookkeeping? I would challenge you no, not right away. First, try to do it yourself. Get some consistency, get some systems set up, and see if it works for you. If not, then definitely outsource it and look for a setup that will work best for your unique needs.
In the meantime, here are a few articles to consult that can help you decide:
▶︎ Thoughts? Feedback? Tell me in the comments.
Originally published at https://www.linkedin.com.
