Business record keeping and what you should do

Wooden Blocks with the text Advice. Wooden ABC

Knowing where your skills lie is a key part of making your business work efficiently. Everyone is good at what they do, whether you are a plumber with 20 years’ experience of plumbing, or a farmer with detailed knowledge of running a dairy herd.

Being aware of your own talents is important, and when it comes to doing your accounts and record keeping, it’s likely that a professional accountant is the best person to carry out your bookkeeping.

Whereas you might get satisfaction from mending a broken water pipe or finding the best milker in the herd, accountants like keeping the books in order. It is what we are trained and qualified to do and where our talents lie.

And because we like it, we can help you get your books in order in the most efficient and timely way possible.

Why is keeping the books so important?

Keeping your books up to date may seem like a chore to many business owners. But there is a genuine business reason for keeping these records and making sure your transactions are all tagged, logged and accounted for.

A good set of books tells you about the health of your business. Whether your books are paper files, an Excel spreadsheet or a full-blown accounting system, the numbers they contain help you to see what is going on in your business. You can see the problems, the positive elements and get a brilliant overview of the landscape of your business – all from writing down your income and outgoings.

The benefits of a good set of books

By logging the money coming into, and the cash going out of, the company you get to understand how well your business model is functioning.

That improved insight helps you to see where costs may be spiraling out of control, or where profits are dipping because of a drop in seasonal sales. Those books become your barometer for gauging whether it’s a cloudy day for the business, or if there is some sunshine on the horizon. That is an extremely powerful tool to have as a business owner, especially when profit margins may be tight and cash flow is poor.

A good set of books can also be important when approaching third parties and financial institutions with a view to accessing additional finance. A bank or private equity company will want to see your accounts and records before considering any kind of loan or investment – and they will make decisions based on the numbers and records that they find in these books.

So it is important to have assistance from a professional accountant who will ensure your accounts are up to date and in good order. When you then apply for business loans, investment or mortgages, you can be confident that you’re making the best possible case for your company.

A well-kept set of accounts shows you are organised, profitable and have the potential for growth that an investor will look for.

Keep your records simple and correct

If you don’t keep good records, it can have a negative impact on the whole long-term success of the business.

With records that are incomplete, or out of date, you’re not well informed and could make bad business decisions, based on false information. And if you are not aware of your correct profit and loss, it is likely that you will end up with a bigger tax bill and an overall reduction in your end-of-year profit figures.

So making sure your records are correct and up to date really is business critical.

There is a basic rule of thumb when it comes to record keeping: do enough to get the information that you want, but keep it simple enough that you can clearly and quickly find the information you are looking for.

With a simple, straightforward approach to bookkeeping, you’re always in control of your finances and have the best possible overview of your business status.

We can help improve your bookkeeping

To get the absolute best from your books, you should seek advice from a professional accountant who can help to streamline your record-keeping processes.

At Saint & Co, we will ensure that your bookkeeping system is set up correctly and is as easy to use as possible. Or, alternatively, we can take on your record keeping for you. Why not let us do what we enjoy – getting your books straight – so you can get on with running your business and doing what you are good at.

Contact your local Saint & Co office and talk to us about outsourcing your record keeping and accounts to our expert team of bookkeepers.