As a small business owner, what do you need to be doing with your money?
- Your accounting system needs to be clean, effortless to access, and easy to review at any time; therefore, proper setup up of your “system” is the essential first step. If you need help, ask.
- Once you have setup your accounting system, it is important that you are consistent with how you manage your accounting system on a monthly, quarterly, annual basis. Calendar it. (Gives a whole new meaning to being accountable!)
- In order to maintain your system, it must be simple, easy to use and scalable. And accordingly, painless to train and monitor a bookkeeper or other accounting staff as you grow.
- Always sign all your business checks so you know where your money is going. If you are using a payroll processing company such as Paychex or ADP, direct deposit, or online bill pay, then you should review your bank account details at least once per week and your credit card statements once per month for any unusual transactions. You need a good banking relationship – and not just with a banker that you see once a year. Be sure to talk to your banker regarding what they require to get a line of credit or other type of loan BEFORE you need the money.
- As your business grows, and assuming you are not an accountant or very disciplined with financial details, you need to outsource the daily data entry of your accounting transactions. Then you can spend your time on growing your business and doing what you do best. My recommendation, in addition to hiring a bookkeeper, is that you regularly work with a higher level accountant with expertise to help you set up, train and monitor your bookkeeper and build internal controls into your accounting system.
- Above all, stop being afraid of your numbers. They are, if you pay attention, soon to be your greatest asset.