If you’re like most small business owners, you probably don’t enjoy pulling monthly financial reports and managing things like payments and bank reconciliations. If you did enjoy these things, you probably would have opened an accounting firm. Nevertheless, managing your small business finances is something that you have to do if you want to stay in business.
At FINSYNC, we’re committed to helping your small business succeed and know how many business owners struggle with bookkeeping.
We turned to Linda Cappadona, a bookkeeper in the FINSYNC Network, for bookkeeping tips and insight into the best ways to keep your business in the black.
Don’t Neglect Bank and Credit Card Reconciliation
Think of bank reconciliations as balancing your business checkbook. It’s how you verify that the funds going in and out of your bookkeeping solution coincide with the funds going in and out of your bank account.
According to Linda, “The best place to start is by reconciling your bank and credit card accounts. That covers everything you’ve ever done because everything feeds either through a bank account or credit card. If you can do that, it gives you a really good sense of where your money is going.”
Start from your beginning balance and reconcile to the end of the month every month. If the closing balance in your accounting software doesn’t match the closing balance of your bank account, then you need to find out why and make a correction. If you don’t conduct bank and credit card reconciliations, you won’t be able to discover what’s causing the discrepancy and fix it.
Build a Payments Rhythm
The second rule of small business bookkeeping for beginners is to build a payments rhythm. Don’t push data-entry and reconciliation tasks off because it’s tedious and time-consuming. It’s crucial that you review your books at least once a week.
It can help to set recurring calendar events and automate processes wherever you can. One way to build a payment rhythm is to automate your bookkeeping to ensure your books are always up-to-date.
Falling behind on bookkeeping can create a mess, and problems become more difficult to undo. At the very least, make sure you always keep accurate and consistent records.
“Before a bookkeeper comes on board, if you aren’t reconciling your transactions and bank accounts, you need to keep good records,” says Linda. “When you start a new business and are moving in a hundred different directions, that can be difficult.”
Make a Category for “Ask My Accountant”
Once you have an accountant on your payroll, it’s important that you utilize them. Make a category for “ask my accountant” and keep them busy with questions. It’s a good idea to file any items you aren’t sure of into this category as they come up. That way, they don’t slow you down when making payments or running reconciliations.
Then, at the end of the month (or sooner), you can bring all of your questions to your accountant’s attention to get the answers you need and broaden the conversation as to how you can mitigate inefficiencies and improve your business finances.
Hire a Bookkeeper
At some point, your books will become too complicated and time-consuming for you to handle. A pro can help you categorize, process bank reconciliations, prepare sales invoices, enter purchase invoices, and help you choose the right accounting software for your business.
Most importantly, a professional bookkeeper will understand what is legal and what is taxable. And how to organize your accounting solution to maximize efficiency. Researching and learning these things yourself can quickly consume all of your time.
According to Linda, “Trust is the main reason business owners are gun shy of hiring a bookkeeper.” She advises business owners to get references, only hire from a reputable company, and don’t hire the cheapest person out there.
“Remember, a good, ethical, trustworthy bookkeeper can streamline your business and monitor your spending habits while keeping an eye out for fraud or unusual activity, and in turn, ultimately save you money,” she says.
FINSYNC’s Virtual Assistance Network is staffed by skilled bookkeeping professionals like Linda Cappadona. Her role is to help you keep your books on track and improve cash flow management.
Tapping an independent financial professional through FINSYNC’s network can help your business run more efficiently without sharply increasing your labor costs or investing time to go through a lengthy employee search.
Here’s a refresher on 5 differences between an accountant and a bookkeeper.
Choose The Right Bookkeeping Software
The key to selecting bookkeeping for beginners software that will provide the greatest benefit to your business is finding software that takes a centralized approach to payments and helps you manage cash flow with less time, effort, and cost to your business.
FINSYNC is the only all-in-one payments platform that can help you keep your business finances in sync, centralize control of cash flow, and connect you with the right financial professional at the right time.
“FINSYNC has a really good platform for projects,” says Linda, adding, “I actually like the FINSYNC platform better than QuickBooks.”
“A business owner can easily get on the FINSYNC platform and see where everything is,” says Linda. “They can see where their money is going, where they need to cut back, and they can access reports. Such as Profit and Loss and Balance Sheets. As a business owner, that is what you should be focusing on.”
How FINSYNC Can Help
FINSYNC allows you to run your business on One Platform. You can send and receive payments, process payroll, automate accounting, and manage cash flow. To learn more about how we can help your business start, scale, and succeed, contact us today.