Having accurate financial records are significant if you are in business. Various reason are attached to this, from making sure you know what your income and expenditure is, to adding up the exact tax to pay the Government. Not keeping up with your accounts could lead to business failure which should be avoided, nonetheless, it you keep on top of them they should not be too burdensome a task.
The above message is a hard one, however, maintaining accurate accounts is not as tricky as it may come across. Source documents need to be kept, such as: the invoices you have handed out; bank paying-in books; cheque books; receipts and bank statements. From this data you make a precise financial spread of your business progression.
After the source documents have been collected, a recording scheme needs to be used to log the information, an accounting system. It is more efficient to record the data on a computer, stored onto an original document rather than record data manually. This is because not only do you have an original but this can be backed up on disk and also sent by email to the taxation service or an accountant. For those of you who are not very competent at computing, there are assorted accounting programs out there which make record-keeping a lot easier. Moreover, it is the less heavy of the two choices and you are able to get your accounts more promptly and access information more quickly, thus keeping an eye on the financial progress of your business.
Whilst you are record-keeping try to be logical and methodical so that the job does not become too big to tackle, especially if you have a lot of different types of receipt that can get lost easily. Attempt to put aside time at the close of the day or in the morning to do some inputting or at the close of the week and make it only for maintaining financial records. The great thing about establishing a procedure which works well with your business, access to your information solidly is the result. Therefore, you have a precise, up-to-date account of your cash flow.
At the end of the financial year, there will be a total financial table of your business to be sent to your accountant or to send information for payment of tax. Depending on how accurate your record-keeping has been, an accountant will find it easy to build a profit and loss account from your information. To ensure that you are on top of the movement of money in and out of your account, put in place a cross-checking system, for example, give each receipt and paying-in slip its unique number.
Remember that precise financial records are for the length of your business, and it is significant to be thorough and exact when recording your information. Plus, it is important to steer clear of any errors that could incur tax office fines. All considered, it is the most efficient way for you to know how your business is performing.
Article Source: http://www.abcarticledirectory.com
Bristol Accounting firm Neil Houghton Accounting offer a broad range of accounting services and have more than 25 years experience looking after the accounting needs of a diverse range of businesses. If you are looking for Accountants in Bristol to assist your business then pay us a visit to discuss your requirements.
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