Bookkeeping for Small Business

In order to do your own books you must have a qualified bookkeeper. A qualified bookkeeper can mean a lot of things. A person that fits this general description will have experience in general bookkeeping. This experience should come from both education and experience working as a bookkeeper. They should understand the principles of keeping a set of books. Know the process involved so they can interpret the information being produce by the bookkeeping software. They should have an understanding of state requirements. As an example, they should know about sales tax, since most states require you collect sales taxes from your customers for certain types of sales.

Having a good qualified person to do your books is just the start. Good bookkeeping software is just as important. Knowing how the software works is a must. It should produce reports that you can use to review the performance of the company. The software should have controls in place to protect the company against fraud. This is one control that most small businesses never implement because they do not have an idea of how to place such controls or that such controls are needed in all businesses, small or large. Along with good software you need to have a good backup. Backups are another thing most small businesses never do. They never realized how important a good backup is until their computer crashes and there is no way to recover the files. Recreating their files is a long and lengthy process not to mention very expensive. Some small businesses that do a backup just keep the backup next to the computer with the original software. If a fire occurs both are destroyed in the fire.

Small businessmen also have to see if having a bookkeeper is feasible for their business. A good bookkeeper may be too expensive for most small businesses and therefore outsourcing their bookkeeping may be a better alternative. With outsourcing their bookkeeping, they do not only get experienced bookkeepers but experts to review their company performance. An experienced firm can suggest new strategies for your business, ways to improve day to day activities of your company, and take the pressure of having to filing timely government reports. These are just some of the ways a professional firm can help small businesses.

Listed above are three important things to consider before deciding to hire a bookkeeper. Hiring a professional firm to do your books eliminates this part of your business and assigns it to someone that specializes on doing books. It should remove the pressure of doing things like bookkeeping and payroll, and having to file all the required payroll reports, leaving you time to spend on the operation of the business.