Learn some Recordkeeping Basics (then Take it PAPER-LESS!)

Running a successful business entails keeping accurate and timely financial information.

A clear financial picture allows you to monitor the success or failure of your business.

A good record keeping system also provides you with the information you need to evaluate the consequences of your financial decisions as well as to accurately plan for the future.

As a small business owner, you most likely rely on an outside accountant to do your taxes and prepare financial statements.  However, it is best that you or someone in your organization take on the responsibility of keeping an accurate set of financial records. It’s NOT JUST the first step in taking control of your financial information and operations — proper record keeping will not only assist to ascertain the value your business &/or operations, it is required by the IRS and other govt. tax agencies.

Read more about record keeping basics below, then consider hiring me to set up your PAPERLESS record keeping system.

For starters, make sure that you file paid bills, canceled checks and other business documents in an orderly fashion and keep them in a safe place. You may use manila folders, filing boxes, or an accordion file divided into “car,” “utilities,” “entertainment” and so on.  (TIP: READ MY ULTIMATE GUIDE TO SETTING UP YOUR FILES HERE) At a minimum, put receipts in the proper categories throughout the year so it would be easier to total them up at tax time.  Staple the adding machine tape to each folder or stack of receipts.  You are not required to keep records in a formal “set of books;” however, you need to find the best record keeping system that works for you. (I can set up the perfect paperless system tailored to you and your needs, and I can also integrate it with your database, accounting, & contact management software.)

Take record keeping seriously. A perfectly adequate record keeping system for a small business might include some or all of the following:

  • Check register – preferably a separate bank account for your business. Make sure that when you receive your bank statement every month that you prepare the bank reconciliation.  This document will help you balance your checkbook.
  • Cash Receipts folder – Cash receipts is an accounting term for deposits in your bank account. It is best to keep these organized in date order, by fiscal year. You should make a new folder labeled “cash receipts-2015” for each bank account at the start of each year (create the folder on your computer or use a file folder, whatever you prefer). Make a copy of or scan all checks before you deposit them for every deposit that goes into your account. If you get paid electronically, file the cover sheet or bank notice or merchant statement or whatever supporting documentation there is in the cash receipts folder, and keep a copy of the transfer or check if you loan the company money. Down the line, you may need to prove that was a loan and not income. Keep track of where your money comes from, putting notes explaining the origin of all money received
  • Monthly summary listings of expenses.
  • Disbursements record (check register or expense journal) showing payments of bills. This could be a purchase journal or an expense journal where you record all the transactions in which you paid out cash or checks.
  • Asset purchase listing (equipment, vehicles, real estate used in business) Keep copies of purchase, escrow, amendments, & capital costs in one folder per asset until the asset is sold, suffers a casualty loss or is otherwise disposed of.
  • Employee compensation record ADP, Paychex, Intuit Payroll reports should be kept by year. If you use a separate payroll account this is part of your cash disbursements for that account.(if you have employees)

Now that you are familiar with basic record keeping requirements, let me assist you to set up a superior record-keeping system that is tailored to YOUR BUSINESS and YOUR NEEDS.

I can create a simple, practical filing system that will assist you to organize all of your records & other paperwork. If you are interested in being able to store your records digitally, I can make it a “paperless” system. Your new digital file cabinet can be integrated with your QuickBooks company file (or any other software) you like!

Everyone needs to get used to working with a paperless office. It is no longer a fancy option to be avoided by the technologically-wary. It saves room, saves time, it is very simple to use, keeps the office neat and is 100% secure and reliable. No more overcrowded or messy file cabinets. No more archiving and storing your files each year – making new labels and file folders each year is a thing of the past!

If you want to know more about setting up a paperless office or ask me a question, CLICK HERE to CONTACT ME

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