3. Use Software to Follow Accounting Workflows
Accounting firms use dedicated software tools to improve their own accounting workflows. Small businesses can leverage this same software power to improve their own internal workflows and accounting processes.
With the right app, you can get more accounting done in less time and expend less mental effort crunching numbers. Many accounting programs are cloud-based, letting you maintain your workflows from anywhere. One key factor in making this small business accounting tip work is to select a tool that fits your business.
Do You Need Accounting Software for Your Small Business? Read on to find out.
Choose the Right Accounting Software
You’ll get the maximum benefit by choosing the right accounting program. A massive, powerful suite of software often isn’t the best solution. You’re likely to experience better results with a program you can customize to fit your existing business needs and workflows.
One of the other best bookkeeping tips for small business beginners is to choose a flexible accounting program. Accounting workflows that fit when you’re a one-person startup may not cut it when you grow to 100 people on the payroll.
Once you can hand off the bookkeeping to someone else, the right workflows will guide your staff to manage the process in the right way. This key piece of accounting advice for small businesses can save time and money as you scale.
4. Update Ledgers Regularly
Once your business gets busy, you may find it simplest to update your ledgers “whenever.” Closing sales and completing jobs brings in revenue, so those tasks often take priority over bookkeeping. But even if you think you have a handle on the timing, postponing account entries until you have a spare minute can lead to bounced checks and late invoices.
Robust accounting workflows can prevent timing problems by establishing healthy bookkeeping guidelines. For example, you might commit to enter the day’s transactions before you leave work, or you may review the ledgers at the end of every week.
Reviewing accounts for errors should be part of your regular workflows, too. Even if you use accounting software or spreadsheets, entering $400 instead of $4,000 can create a major yet avoidable problem. Following this particular small business accounting tip can save you a significant amount of money with a well-organized general ledger.
5. Workflow Your Routines
Accounting workflows aren’t just for data entry. They also help you keep tasks such as invoicing on track. Whether you send invoices at the time of service, the end of the week, or the end of the month, making it routine makes it easier to maintain consistency.
Having an invoicing workflow also makes it easier to spot problems. Suppose you bill all your clients at the end of the month. That schedule makes it easier to go over accounts receivable and spot late payments than if you billed throughout the month. A good workflow also keeps you on time when you have to submit sales tax or estimated tax payments.
Once you have the right accounting workflows in place, you can assign the accounting to someone else. If they follow your workflows, they should get the same results you would if you were still doing them yourself. This is one of the best time-saving accounting tips for small business owners.