Bookkeeping may look like a great time waster to most small business owners but it is a silent factor
that can either make or break your business. If you really want to grow from a small business owner to a big business owner,
then you better start taking bookkeeping accounting very serious.
Bookkeeping is just a small part of accounting or financial management in general, but it is a great
place to start especially for small business owners who desire sustained business growth.
Bookkeeping accounting is all about keeping and maintaining financial books. These financial books are
very crucial to both small and big business survival. If you are poised for growth and success, some of the books and records
you should be keeping are:
Profit and Loss accounts
Credit purchases/Debit book
Cash payment vouchers
Having explained the various
books every small business owner should keep; below are seven reasons why bookkeeping accounting is important for small businesses.
of Bookkeeping Accounting for Small Businesses
1. Bookkeeping accounting will help
you plan ahead for your business. You can call it budgeting; it is all the same. Forecasting your business needs ahead and
planning for purchases and other business miscellaneous will become easier with bookkeeping.
2. Bookkeeping accounting will help
your small business meet deadlines and help you make timely payments of loans, rents, bills, taxes and so on.
3. Cash flow management will never
be possible without proper bookkeeping and no business can stand the test of time without effective cash flow management.
4. Bookkeeping accounting will help
you evaluate the performance of your small business to know if your small business is stagnant, depreciating or growing. When
you know the performance level of your business, you can strategize and make certain adjustments on your business.
5. Bookkeeping accounting will help
you forecast the future of your small business, set projections and goals for the business.
6. Bookkeeping accounting will help
you know when it’s time to bring in extra hand or increase your employee base. Bookkeeping will help you know if your
business can foot the extra expenses incurred by bringing in new employees.
7. Most small business owners often
ask me how they can build their own business team or seek professional advice without incurring extra cost. Their problem is always “how can they afford their own business
I often explain to them
that the cost will always be there but it’s up to their business to pay for those expenses. Your business should foot
the bills incurred in the process of building a business team or seeking professional advice and how do you know your business
can foot the bills? The answer points to proper bookkeeping accounting.
As a final note, proper bookkeeping accounting will help you compare your present financial status to
previous year records at any point in time. This will in turn help you analyze your growth rate. If you are growing at a rate
of 25% or 100%, it will be determined by the financial records.
So I hereby advice you to start bookkeeping for your small business today and you will see an improved
positive cash flow in your business.
Aegis Bookkeeping and Income Tax Service can help you keep your books, your payroll, and your taxes