Ask a group of business owners what part of owning a business do they like the least and most will say bookkeeping.
If you’re like me, if you don’t like doing something, you either don’t do it or you delay it as long as possible.
But…if you do that with bookkeeping, you can get yourself into some serious trouble.
What to do, what to do…
Start with the why
The process of bookkeeping is to generate financial records that show the health of the business – good or bad. You may not like bookkeeping, but I’m sure you want to know how your business is doing.
- Am I making money?
- Do I make enough money to hire a helper?
- Are my customers paying me and on time?
- What inventory is not selling?
- Are my prices too high/low?
- Did I do better this July than last July?
- Do I have enough cash to pay my taxes next month?
Like anything, when you focus on the good aspects, you’ll dislike it less.
Here’s My Income Statement, now what?
Many owners spend countless hours signing checks, approving payroll, balancing their bank account and printing a financial statement only to never review it or understand what it is telling them (or the balance sheet or cash flow statement).
Some of the line items on the statements are non-material and can be ignored, but many are crucial to understanding how you are doing and what is doing well and what needs your attention.
It’s Cram Time
I can remember more than once, being assigned homework to prepare a large report in school. The teacher gave me months to do the work, but did I get started right away? No, I waited till the last week, or last day and stressed and pounded out the work to make the deadline.
As mentioned in the intro, tasks that are not enjoyable are frequently delayed as long as possible. But that can make them even more annoying and prone to errors.
Breaking up bookkeeping tasks into small daily tasks, minimizes the stress and errors and makes it less annoying than doing it all at once.
Using Quickbooks Online
Do you still use a checkbook and Excel to do your bookkeeping?
Quickbooks is an inexpensive monthly expense, and having the online version means you can do your bookkeeping at home, at the cabin, or anywhere? Maybe you don’t want to take work home with you, but maybe a change of scenery is just what you need to relax and get it done.
Quickbooks also does many of the checks and balances for you like making sure entries are balanced, which accounts are reconciled, importing bank transactions for you. This makes the monthly expense pay for itself with time saved.
Delegate the Task
Okay, so I’ve given you several ways to remove some of the frustration of doing bookkeeping, but for some there’s still enough pain remaining.
When you realize how little money it costs to have this done for you, you will wonder why you didn’t farm it out sooner.
Hiring a bookkeeper or outsourcing one, will enable you to:
- Focus on other things with your business (things more enjoyable and profitable)
- Have your bookkeeper explain the financial statements to you in one hour for the whole month
- Speed up putting together what you need for your tax returns
If you’ve been thinking about outsourcing your bookkeeping to someone else, why not contact me to start the conversation? It’s not too late to have me help you get your financials ready to send to your tax accountant for your 2019 taxes.