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Accounting for your business is required to keep a careful track of your finances and to allow an easy understanding of the cash flows of the business. Keeping up with your small business’s accounting can be quite a complicated task, especially if you do not have help from small business accounting experts or a tax accountant. To make things a little easier for you here is a checklist for you to follow to stay up-to-date with your accounting.
Record all the incoming and outgoing cash flows and maintain separate files for each. Document and save all the receipts from the transactions made by your business. This is an essential task for small business accounting. Save all the records of transactions such as bills, receipts, invoices for tax references and small business bookkeeping purposes.
Pay Vendors and Sign Cheques
Every week, you must settle pending vendor payments and sign cheques. This is important as doing it on a weekly basis ensures that you are not faced with a large heap of pending payments at a later stage.
Prepare and Send Invoices
Just as it is imperative to settle pending payments regularly, it is important to receive payments owed to your business. You need to prepare invoices and send them as and when projects are completed. Doing this once every week ensures that your business has a steady flow of cash influx.
Monthly ChecklistBalance Account
At the end of each month, make it a point to balance your company’s bank account. This is the most important part of your small business bookkeeping and needs to be handled promptly.
You can do this at the end of every month, just before it is time to pay the monthly salary of your employees. Review the payroll structure and inform the employees of changes, if any. Maintain detailed logs about changes in the payroll to allow for easy small business bookkeeping.
Settle Tax Payments
Your business cannot afford to take tax payments lightly. You must have a well-qualified and expert tax accountant at your disposal to handle the tax payments and documentation of your firm. Ensure your tax accountant has been provided with all necessary documents required for tax filing and payments.
Yearly ChecklistReview Past Due Receivables
With the year coming to an end, it is time to review past receivables which have still not been received. Evaluate the possibility of obtaining these receivables and take necessary action by either sending them to an external agency to collect or by reducing the amount owed by the defaulter.
Review your current inventory to determine the value of items not sold. If you have a skilled tax accountant you will know that any write-down of inventory translates to a deduction on your year-end taxes. By not writing down unsellable inventory, you are overstating your inventory balance and paying additional taxes that you don’t owe. Instead, write down all the items of your unsold inventory and let your tax accountant handle the taxes you are liable to pay.
Follow this simple basic checklist for small business accounting and make accounting easier for your business. Hire an adept tax accountant to handle the small business bookkeeping for your business and file your tax returns carefully.