Whenever we talk with small to medium-sized business owners, there is a common theme of bookkeeping questions – about what we do and how we deliver for clients. There are common misconceptions about bookkeepers – and even what bookkeeping comprises. Many business owners try to do it themselves and struggle to understand what goes where.
To help with a small introduction, your team at Pebbles Bookkeeping services in Manchester decided to break down the basics for you.
The What, the Why and the How
Bookkeeping is the process of recording and organizing your business’s financial transactions by maintaining accurate records of income, expenses and other financial activity.
Bookkeeping is essential for businesses of all sizes as it separates your income and expenses, manages your cash flow and keeps you compliant with tax regulations. When you have all of this in order, you can make more informed business decisions and accurate strategies for growth. Bookkeeping should be conducted regularly – from weekly to monthly – to ensure your records remain updated and accurate, allowing for sharper business operation and decision-making.
Avenues for Bookkeeping
There are several ways you can conduct bookkeeping within your business. Obviously, as with everything, there are many different software that you can use, such as Quickbooks, Xero or Sage. The ideal one for your business depends on your business needs and budget.
Whilst possible to conduct your bookkeeping practice, it can be time-consuming and complex when you lack accounting skills. Hiring outsourced bookkeeping services saves a lot of time and expense whilst accurately keeping all of your financial records in order – as well as having a professional service to hand that provides insight into excessive spending and ways to save money.
A bookkeeper is separate from your accountant, but they do have some areas that cross over. Whilst accounting involves analyzing and interpreting your financial data, bookkeeping involves the recording and organization of your financials so that accounting can make more informed decisions.
What Do I Need?
At a minimum, you keep records of all income and expenses, bank statements, invoices, receipts and tax documents for your business.
If your business is VAT registered, you keep accurate records of all VAT-related transactions for reporting to HMRC regularly. Bookkeeping services can help with this area, as well as keep all records reviewed periodically.
If you have any bookkeeping questions, or looking for more information about small business bookkeeping solutions, contact the friendly team at Pebbles Bookkeeping for outsourced bookkeeping and Xero training.
We help all clients understand that bookkeeping does not have to be intimidating and alleviate the stress of getting your financials structured correctly.