Are you starting a new business? Or struggling financially with an existing one? Small business owners wear many hats. One hat they wear is the Accounting green shade. Here are 10 best accounting practices that will remove the clutter, save time and get financial results.
- Keep business transactions separate from your personal – set up a separate checking account and credit card
- Select an Accounting software – make it easy for you and fit your technical skill set
- Customize your chart of accounts to collect the critical information that you need
- Map out your transaction flow – customer invoices, collections, bills to pay, information requests, independent contractors, employees, etc.
- Job costing – set up system to keep a watch on your gross margin
- Design financial statements you understand and will use – simple & effective. The more you use them the more accurate they become.
- Prepare a cash flow budget – plan for success by month.
- Identify what 3 key success activities you need to do and monitor each week
- Customize your weekly checklist, monthly checklist and annual financial checklist
- Work with a tax, accounting and tax advisor to refine your system
Pick a time once a week to work your books. Outdated information might work to get your taxes done – but has little value when managing your business. By taking one hour a week – you stay organized, and improve your financial success. This will allow you to hire someone to take over the parts you don’t like faster.
Here’s to your financial success!
By Mary Guldan-Lindstrom CPA
At FOCUS CPA Inc. we can help you through this process. We are creating a new business startup accounting kit, with software comparisons, sample chart of accounts, a monthly cash flow budget, sample dashboard based on type of business and a weekly, monthly and annual financial checklist. Prices range from $250 for a one-person service business to $750 for a manufacturing business.