New to bookkeeping? Not sure if you need it for your business?
This page will answer common and basic questions on bookkeeping.
What is bookkeeping?
Bookkeeping is the recording of transactions that are created by your business into the appropriate debit and credit categories. Whether it’s the purchase of a new building or your telephone expenses, all transactions need to be recorded appropriately for you to have an accurate measure of how your business is doing.
For your business to operate successfully you need to know where it has been financially (if you’ve being in operation for any period of time) and where you’re going. Bookkeeping gives you this information and enables you to plan as well as determine how well you are doing.
Why does your business need bookkeeping?
Bookkeeping is important to give you a clear insight on how your business is doing financially. In making any business decision, from selecting a phone provider to deciding whether to open a new location, you need to know how much money you have, are making, are spending and are saving. This is where bookkeeping gives you answers. It is also needed for tax purposes, without accurate sales and employee information you can’t provide the CRA with reliable information and your risk of audit and penalties increases significantly.
What can bookkeeping do for your business?
- Lowers your taxes by, filling accurate reports and payments, claiming all the deductions you’re entitled to.
- Minimizes your risk of government audits, and ensures that if you are audited the process is quick and penalty free.
- Eliminates late fees from vendors
- Helps ensure timely collections from customers.
- Assists in making sound business decisions based on accurate financial information.
- Provides reports that help in clearly understanding the strengths and weaknesses of your business.
- Improves your cash flow, allowing you to better control revenues and expenditures.
Your growth and profit potential is maximized by the sound business intelligence that bookkeeping provides.
Is my business too small for bookkeeping services?
All businesses need bookkeeping services to maximize their potential. Without bookkeeping your financial reports will be non-existent or unreliable leaving your financial state unknown. Many small businesses have little or no bookkeeping records. While a few successfully operate this way there is no doubt that they could greatly improve their financial results with good bookkeeping. Sadly, many small businesses that don’t know the importance of bookkeeping fail. In the article “Top 10 Reasons Small Businesses Fail” by Jay Goltz. Mr Goltz lists bad accounting as the number 4 reason small businesses fail.
In short, no business is too small. Our services are affordably priced and will pay for themselves by improving your financial performance.