Hello, all businesses that have been ditching bookkeeping for a while. Let’s face this: you need it, whatever be the size and type of trade. Who knows, your negligence might have been pressing an adverse impact on your business.
And here’s something dreadful you should know about the Australian trade ecosystem: most businesses fail because of poor financial management and most importantly, the absence of books of accounts.
For those still living under a rock, bookkeeping helps you keep a record of your organisation’s monetary transactions covering the categorising, reporting, and analysing of financial data.
Here Are 5 Reasons Why Bookkeeping Is Of Utmost Importance For Businesses
- For Cash Flow To Continue
The process is designed to simplify complicated tasks like financial management. In a business, this is of great value as cash flow needs to be primarily focused. Delayed invoices and pending payments that are not followed up will eventually leave the commerce cash strapped.
And a trade without monetary gain doesn’t take too long to crash. However, if you inculcate this process within your company, it will help you organise everything and work towards timely payment.
- For Meeting Tax Liabilities
To meet yearly taxes, your company has to systematise its documents and keep a track on vital trade information. There should not be last-minute rushes to hunt for bills and invoices or recollecting all expenses incurred when taxation hits.
What needs to be handy are Balance Sheet and Profit & Loss Statements put in order. You also need to prepare financial statements and show accounting transactions via correct journal entries. And how’d you do it? – Of course, by recording the financial affairs of your business.
- For Audit Preparation
Audits are inevitable. This is also a legal obligation your business must meet. And the process will help you keeps your records organised. You can retrieve them whenever needed during an audit, no matter how small or big an invoice is.
- For Updating Investors
Investors and stakeholders for your business need to be aware of your financial status. You need to keep your monetary transactions transparent. However, reporting is a crucial task. You cannot do it if you have already messed up the arrangement.
This is where bookkeeping service comes to play. Your book of account will help you present all required graphs, charts, and data that are of interest to your investors. This simplifies business deals to a great extent.
- For Overall Business Planning
We don’t know of any business that has ever run without a plan. Balance Sheets and Profit & Loss Statements are the crux of this plan, don’t you think?
When you record all your proceedings and keep them in an organised manner, it helps you ascertain if your trade in on its correct financial track. Planning, as such, becomes easy.
Ready To Hire A Bookkeeper?
As much as your business yearns for success, it is also susceptible to bankruptcy, lest all records are put straight. A bookkeeper can help you see the difference and knock your expenditures into shape.