Unless you’re an accountant, the word “accounting” probably strikes fear in your heart – or a little bit of nervousness, at least. For young entrepreneurs, the feeling is probably amplified. After all, poor bookkeeping out of the gate not only can set a project back in the short term, it can really come back to bite you over the long haul. Even young entrepreneurs get audited, you know.
That said, it is possible to avoid the ire of HMRC. Here are a four accounting tips to start your business by:
- Start off on the right foot. In the same way that you go through your email every morning, or in the same way that you do anstock review each week, make your business accounting a habit. Set a recurring alarm on your calendar: “Review books!” The frequency is up to you, but you should carve out some accounting time at least once a month, if not more, one a week will keep you on track easier.
- Learn the lingo. The cumbersome terminology of accounting is sometimes the biggest hurdle. Chart of accounts? General ledger? Cash vs. accrual? Accounting lingo isn’t natural — and ignoring what’s what won’t help you. So take some time to understand the basics.
- Find software that fits you. Find the accounting software that’s right for you. Don’t simply opt for what your friends use. If you’re always at a desk, a desktop solution, like Sage Accounts or QuickBooks Desktop might make sense. If you’re like most entrepreneurs and on the go 24/7, something cloud based like SageOne, KashFlow, FreeAgent or Xero may make more sense. If you’re running your business from your iPad, go with a cloud-based accounting software package.
- Value good advice. Chances are, if you spend enough time trying to figure out an accounting issue, you could. But the reality is, you’ve got a business to run. And considering that you’ll need to file VAT returns quarterly, accounts, corporation and personal tax returns annually – there should be a certain degree of urgency involved. There’s great value in an accountant or bookkeeper who specialises in small business, like we do here at Cannon Moorcroft.
We even provide a huge amount of advice, tools and calculators online for free. We’ll also be a voice of comfort if you receive some alarmingly confusing HMRC mail.
In the end, accounting isn’t really that scary. If you start off right, it can actually be fun. After all, that’s where you’re going to see your fortunes grow.
What better bookkeeping tips would you add to this list? Leave a comment and let us know.