Business Owners Idea Cafe: Small Business Information, Resources & Tips
Small Business Tax Center
Small Business Ideas, Grants &
Plans to Start & Run a Business:

Small Business Grants
CyberSchmooz
Network in Cyberschmooz Community Ask Questions Questions and Answers Share Tips

Small Business Ideas People in Biz - Profiles
Business Advice from Idea Cafe Experts Coffee Talk with Experts

Starting A Business
Business Plan Biz Planning | Sample Plans
Small Business Ideas Idea Name Your Biz Name Plan Your Biz Plan Financing $ Starting a Business Do It!

Running your Business
Marketing Tips Marketing | Sales | Customers
Human Resources HR | Employees | Contractors
Legal Forms & Tax Information Legal | Biz Forms
Managing a Business Managing | Operations


Financing Resources Financing Your Business
E Commerce & Webhosting eCommerce

Take Out Info
Trade Publications FREE Trade Publications
Business Books Biz Books

Your Own Business
Small Business News Small Biz News
Gen X Biz Gen X Biz
Work at Home Work @ Home
Business Information The Fridge - Biz Info on Ice
Destress
Send Awards Send Awards & Greetings
Yoga At Your Desk Yoga @ Your Desk
Fun Guide Guide to Find FUN Online

About Idea Cafe
Press Idea Cafe has received Idea Cafe in the News
Idea Cafe's Kudos Kudos for Idea Cafe
Advertise on Idea Cafe Advertise on Idea Cafe
Privacy Policy Privacy Policy
Contact Idea Cafe Contact Idea Cafe
Link to Idea Cafe Link to/from Idea Cafe

Join Idea Cafe

Search Idea Cafe
Site Directory Site Map
Online directory to business resources Biz Web Guide

Who?

Who handles your recordkeeping responsibilities? Needless to say, there’s no one answer to this question. Different sizes and types of companies need different technical solutions and staff or freelance help to get their recordkeeping done as simply as possible without underserving their needs. Here we won’t suggest, review or list all types of solutions to consider, but we will offer a few tips to consider as you make choices for your firm.

For soloists and small companies

Many solo business owners, such as consultants, may have infrequent sales, but each one brings in a hefty chunk of money. Plus, the smaller the business, the fewer expense payments need to be made. These owners are probably of the breed that went into business for themselves to be free of excessive red tape and prefer to keep things simple.

Do it yourself

Owners who keep their businesses small could actually fire up their accounting software a couple of times a month and deal with doing the updating and filing themselves.

Farm it in

Or -- as we recommend -- have a virtual assistant, freelance office assistant or bookkeeper come in for a few hours every two weeks or so to organize and process what needs to be paid, what has been paid, then print out checks, record deposits, reconcile bank accounts and file paper records.

If you want to delegate this function, it will be more helpful to have someone come IN to do the work in your office, instead of your having to gather the stuff and take it OUTSIDE so your provider can do it at her office. (If you have to gather the stuff together, drop it off, pick it up, then file everything, you’ve made the work convenient for someone else. Instead, the point should be that someone else handles it for YOUR convenience.)

Getting someone else to do this on a consistent basis frees your mind from getting embroiled in little details so you can keep your focus on income-producing work or enjoying more free time. Plus, this solution overcomes the procrastination that most of us feel coming on whenever we start to think about how we really need to get around to that pile of bookkeeping.

How does it get done?

OK, you’ve got your accounting software ready so each transaction can be input and categorized. And you’ve determined who will handle the task. Now, exactly what must be done?

Get an in-box

A crucial tool is probably one of the most basic, unsophisticated pieces of equipment in your office -- the in-box! You need an in-box that can be exclusively used for financial stuff.

Whenever you receive a new bill, new payment, new deposit receipt, new bank statement, or any new piece of finance-related info, just drop it in the financial in-box.

Then, whenever you, your virtual assistant, your staffer -- whoever you determined will be your recordkeeper -- steps over to deal with the financial stuff, the first thing you do is sort out the in-box contents into piles. A pile for new bills, a pile for deposits, and so forth so that each item can be dealt with as a group with like items.

Your diligent recordkeeper works through the piles systematically. Each completed or to-be-done transaction gets recorded into your accounting software program, categorized by type and action taken. Most everything will be either an income item or expense item of some type. You select the appropriate categories via dropdown menus.

Then you ask the software to print your deposit slips, your checks, the reconciliation of your bank statement -- whatever paper you need for further action or filing. Now you just sign the checks and mail whatever needs mailing.

In the process of inputting each transaction, your company financial statements were automatically updated, so you can look at any of them via the software to see where you stand. How’s your Profit & Loss (P&L) picture looking this month? How does that compare to where you were this time last year? How close are you running to the budget you projected? How much total cash does your Balance Sheet show the company has on hand right now?

Ask the software any question about your business’ current financial situation you can think of -- it can probably show you the answer in an instant.

How do you wrap it up at year end for your taxes?

Unlike the old 'shoebox” method of accounting, since you’ve kept your data up to date throughout the year with your accounting software, there’s no big year-end hassle. You’ve already got all your answers! You can set up an early meeting with your accountant. His office will be able to finish your returns before their annual March/April frazzle period sets in.

Take a careful look through the “expanded” version of your Profit and Loss Statement that your software offers. It will show the detailed list of each transaction, so you can be sure everything is in what you feel is the right category. Then review your categorization with your accountant to see if he or she thinks you should classify anything differently.

Your recordkeeping is done! And since your filing of papers was dealt with each time after the accounting data was updated, you’ve got the paper documentation in place. Go celebrate!



DISCLAIMER: We have provided this information to give you a general introduction to tax issues. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Neither Idea Cafe Inc. nore any of its sponsors or advertisers make any representations or warrantees regarding this publication or its accuracy. In no event shall Idea Cafe Inc. or any of its sponsors, advertisers or affiliates be liable for damages, including incidental or consequential damages, in connection with or arising out of the performance or use of this publication. By utilizing this information, you are agreeing to our full terms of use.

Copyright 1995-, Idea Cafe Inc. Downloads are for personal use only, not for resale to others, and may not be reprinted in any form without written permission from Idea Cafe Inc.