{"id":773,"date":"2021-10-25T04:06:31","date_gmt":"2021-10-25T04:06:31","guid":{"rendered":"http:\/\/www.trakaccountants.com.au\/blog\/?p=773"},"modified":"2021-10-25T04:07:18","modified_gmt":"2021-10-25T04:07:18","slug":"small-business-bookkeeping-heres-how","status":"publish","type":"post","link":"https:\/\/www.trakaccountants.com.au\/blog\/small-business-bookkeeping-heres-how\/","title":{"rendered":"Small business bookkeeping \u2013 Here’s how"},"content":{"rendered":"\n

While software has replaced the leather-bound ledgers of the past, bookkeeping is still an essential task for modern business owners.<\/p>\n\n\n\n

Here\u2019s how it works \u2013 and why it\u2019s so important.<\/p>\n\n\n\n

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Bookkeeping benefits<\/strong><\/p>\n\n\n\n

Accurate, up-to-date financial records are vital for running a small business. They let you keep tabs on spending, help you plan and budget, avoid cash-flow issues and identify payment issues that could be costing you money.<\/p>\n\n\n\n

Even more important, well-kept books are a must when it comes to completing accurate tax returns and working with lenders.<\/p>\n\n\n\n

Bookkeeping basics<\/strong><\/p>\n\n\n\n

  1. Recording means keeping a record of every incoming and outgoing transaction.<\/li>
  2. Reconciling involves checking transaction data against bank statements to make sure everything matches up. This helps you identify errors or late payments \u2013 or in some cases, fraudulent activity.<\/li><\/ol>\n\n\n\n

    Bookkeeping in a small business also includes accounts receivable, accounts payable and payroll \u2013 that is, sending outgoing invoices, paying incoming bills and paying staff.<\/p>\n\n\n\n

    Simplifying bookkeeping with software<\/strong><\/p>\n\n\n\n

    In the past, business owners recorded sales in a ledger, kept paper receipts for business purchases, and cross-referenced bank statements by hand.<\/p>\n\n\n\n

    Now, accounting software can take on many of those tasks.<\/p>\n\n\n\n