Bookkeeping - What To Use
When you start a business, there are so many decisions to make. I’m hoping to make one decision a little easier.
Bookkeeping is something that most business owners don’t enjoy doing, and that can make it easy to ignore. But accurate bookkeeping is a vital part of having a successful business. If you don’t know how much money you’re spending, or where all of your money is being spent, you can’t possibly know if your business is making money.
Many programs claim to be able to help you track your finances. Even your customer management system may want you to use their tracking. The key is to figure out if the system you choose is going to be helpful long-term. You can choose to start out with something basic, such as a spreadsheet or basic expense tracker, but if you're looking to be in business for the long-haul, you may want to invest in something more robust that can grow with your business.
Quickbooks Online (QBO) is the option that I recommend for my clients as it can grow with your business, and be helpful no matter what stage of business you’re in. It may feel a bit intimidating at first, but you can have a bookkeeper or accountant help you set it up and teach you the basics to get you going. Then when you’re ready to have someone else do your bookkeeping it can be a smoother transition.
QBO allows you to set up your Chart of Accounts (a list of categories that your revenue and expenses get organized into), as well as payroll and tax tracking to allow for easy and accurate reporting to the government. Accurate use of QBO allows you to easily hand over your information to your accountant at the end of the year when it is time to file your taxes. It also allows you to pull up reports to look at whether you’re making a profit or not, and compare that report to a previous month, quarter, or year.
Did you know that you can use QBO to organize the bills you owe? You can enter any bills you get that you aren’t going to pay right away, showing who you owe, when they’re due, and how much. If you’re tracking HST you enter that as well. Then you can set aside a time each week to go into QBO and figure out who you need to pay that day. Once the payment is made, you can mark it as paid in QBO. This helps avoid late or missed payments, and is a great way to track your expenses.
Ultimately, the important thing is to make a decision about how you will track your revenue and expenses, and then stick to it. The worst thing you can do is not keep a record, because when it comes time to do your taxes you will be scrambling to find all of the information. Plus you won’t have any idea how much money you made or lost.
If you’d like help getting your bookkeeping setup, please reach out. Duet Bookkeeping is here to help!