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As a bookkeeper I can’t stress enough how important it is to have a good bookkeeping process in place for your business. Bookkeeping is the first step in compiling income and expenses and then turning the financial data into reports, statements, and many other essential tools you can use as a business owner.
Benefits of bookkeeping come from having a good bookkeeper. Behind every good business is a good bookkeeper who will help you benefit from your record keeping throughout the year.
Before we get started let me remind you to sign up for my free Bookkeeping Simplified Guide. My Bookkeeping Simplified Guide includes free access to my method on how to put your bookkeeping on a schedule.
Here are ten reasons why bookkeeping is critical to your business:
Bookkeeping will tell you how much income you are receiving and how much you are spending in expenses. You may have to cut back expenses or change vendors to budget money for business goals.
Bookkeeping helps you to make smart business decisions. Some of these bookkeeping decisions include finding ways to increase income, decrease expenses, and recognize opportunities to make money.
Once you have a bookkeeping process in place and your bookkeeping is kept up to date weekly, semi-monthly, or monthly you now have statements, reports, and current financial data to keep you aware of the ongoings within your business.
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When you have a reliable and accurate bookkeeper on your side you can definitely benefit from finding errors. Inaccurate record keeping, categorizing, and lack of procedures are just some of the errors a good bookkeeper will find.
Focus More Time on Your Business
Benefits of bookkeeping include having time to run your business. Processes in place for bookkeeping allow for more time to be the business owner, make managerial decisions, and generate income.
Benefits of bookkeeping are keeping your records up to date, so you have financial statements and reports that are accurate. It makes it easier to plan for future business growth, business highs, business lows, and other opportunities.
Requirement by Law
Regardless of your industry you will need to keep in compliance with federal and state laws. A bookkeeper will ensure payroll tax, sales taxes, and other payments are made on time and correctly.
With the help of a bookkeeper, you can save money by tracking expenses, creating invoices, keeping up with inventory, and having up to date reports and statements for review.
Predicting yearly tax outcomes are easier to do with accurate financial statements and reports. One of the benefits of a bookkeeper who works with your accountant or tax advisor is the ability to break down deductible expenses for income tax season.
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Profit Growth and Trends
Yet again, having a good bookkeeper on your side allows you to utilize reports to view profit growth and trends. Monthly, quarterly, and yearly comparisons can easily be used when you have the use of accurate and up to date bookkeeping. Predicting and changing trends assist in the financial growth of a business.
Every business benefits from having a detailed bookkeeper. The bookkeeper you hire should be working to make your job easier. If you already have a tax advisor or CPA, your bookkeeper should be able to work closely with that individual to help your business succeed.