Accounting Mistakes You Can Avoid As A Small Business Owner

The bookkeeping process alone can be one of the most time consuming activities required to keep the company going. Many small firms have limited staff to no staff at all, meaning that there is a very good chance that an employee or even yourself having little to no accounting background is in charge of the bookkeeping. This leaves the door open for the possibility of multiple mistakes, especially if the accounting duties get pushed to the back burner. Although this method saves money, it can pose problems when it comes to accuracy and timeliness. 

Paper files can also build up very fast, and over time it is easy for bills or statements to get lost in the mess. There are many tax deductions that small businesses are allowed to take, especially if the business is considered personal or ran out of the owner’s home. So keeping receipts is essential to receiving tax deductions on income, this can definitely be overlooked, it may be small but it's definitely a critical procedure. 

When small businesses do their own accounting work, they tend to make far too many accounts than actually needed. Trying to be overly organized and can cause you to make a large number of accounts, but if you have hundreds of them that are only used a few times, the books can become extremely cluttered which makes it hard to find a specific transaction and produce clear financial statements.

Although doing your own accounting as a small business can save you money, in the long run it is a good idea to have the job outsourced. This can prevent clutter, mistakes, and possible errors in reporting income.

3 Tips To Reduce Bookkeeping Costs

It doesn’t take long for bills to mount up when you’re running your own small business or startup. The good news is that this doesn’t have to be the case for your bookkeeping expenses. This month we’ve consulted with our top bookkeepers to bring you the below three tips on how you can reduce your bookkeeping costs so you can get back to spending money on growing your company.

Be Organized

Whether you are paying your bookkeeper an hourly or a fixed fee, being organized is the most important tip and one which will not only save you time but also money. Bookkeepers can only work with the documents you give them, so the more information you have on each transaction the better. If you pay a bill, make a note of all information relating to the payment including payment date and method (particularly if you have more than one account/credit card). Only providing the bookkeeper with the invoice and not the payment receipt means they will not be able to enter this payment until it shows up in their cloud accounting bank feed or your monthly statement.  In some cases it might help to ask your bookkeeper how they want you to present information to them on each transaction. Ultimately, you want to get to a point with your bookkeeper whereby they have all of the information they need to keep your books up to date, which requires you to be organized. 

Open a Separate Account For Your Business

Using a business account for personal payments will leave a complicated trail of transactions for your bookkeeper to figure out and cost you more money. You should always have separate bank accounts for your business and your personal life. What’s more, if you are paid in cash by a client, don’t be tempted to keep some of that cash for yourself. Depositing cash into the correct business account straight away will save your bookkeeper time when trying to match deposits.

Store Your Documents in a Document Management System

Save yourself time and postage costs by utilizing a document management system. Instead of filing receipts away in a shoebox and posting them to your bookkeeper when requested, now you can take a picture of your documents (receipts/invoices etc.) and upload them to a cloud based document management system. This allows you to securely save a copy of your important financial documents which can then be accessed by you at any time. There are many great document management systems on the market including Dropbox and Smartvault. At AG Rueda Bookkeeping we always recommend OneDrive because it allows you to invite your bookkeeper to safely access your uploaded financial documents. The OneDrive application provides a more efficient bookkeeping workflow because you or your invitees can add tags and notes to each uploaded document, providing more information for your bookkeeper to work with. 

5 Apps To Improve Your Small Business Productivity

Apps are helping people all around the world to better plan and help business owner's be more productive. So we decided to go on a internet hunt and ask around to see what are the best recommended apps for you. 

• ASANA is one of my favorites as it is great for building projects, scheduling meetings and setting goals. Not only does it create tasks for yourself but you can also assign one to a team member. You can have project conversations and attach files to any of the project's created. It's an amazingly simple and effective app that can be used by anyone.
• 1PASSWORD stores all of your passwords. Do try to remember every single one of your passwords because it can be exhausting. This app will store just about anything, credit card information, addresses, notes and will automatically store all of your passwords so that you can log in to any of the websites without having to remember. I've had this app for about 5 years now, and it is indispensable! 
• TOGGL is a timer that tracks every second of your time, making it ideal for anyone who needs to log billable hours. You can track as many projects or clients as you want, view colorful graphs, export time sheets, and sync your numbers with several project management apps.
• PAYPAL HERE operates a lot like Square — you use a small card reader with your device to receive payments. Each swipe costs 2.7%, which is a bit lower than Square. However, PayPal Here has a few added features, including the ability to process checks, electronic invoices, and payments from a customer’s existing PayPal account.
• QUICKBOOKS SELF-EMPLOYED has a lot going for it, including a familiar, easy-to-navigate interface and integration with many other services. You can send invoices on the go, view balances, approve estimates, and link to many other services including PayPal. You can also digitally store receipts, automatically track your mileage and best of all it will do the math for you so you know how much tax you owe at the end of each quarter to avoid year-end surprises.