Owning and operating a small business can be incredibly rewarding and fulfilling, but it can also be overwhelming at the same time due to the fact that there are so many moving parts to keep track of. If you dislike having to do your own bookkeeping or don’t understand how good bookkeeping can improve the financial health of your business, then read on.
The objectives of bookkeeping are fairly straightforward. It enables business owners to make sure that all money and transactions are accounted for in a systematic, orderly, and logical manner. At the Clem Collaborative, we approach bookkeeping and financial management in a more holistic way. We go beyond looking at just the numbers and take the whole picture into account. At the Clem Collaborative, we help our clients see the story in the numbers. The story that is telling you, in black and white, what’s working, what isn’t, what amazing opportunities there are for you, and what pitfalls are lurking around the corner.
Now that you have an understanding of the objectives, let’s take a look at why bookkeeping is so important for your business. First and foremost, bookkeeping is required under the law and whether or not you like it, you will have to pay some of your money to the government for taxes. Bookkeeping, however, can help make the tax preparation process go much more smoothly since all of your financial data will be organized in one place. It also helps you see beyond your net results and whether or not you simply made a profit or are in the hole.
Bookkeeping is a tool that helps business owners assess the financial health and performance of their business. It can also provide business owners with an updated snapshot of their business and help with:
At Clem Collaborative we approach each of our clients as if they were our only client. This allows us to provide a level of service that lets us see the full picture of your business. We go beyond basic bookkeeping to move you further and faster towards your goals.
Just as there are many reasons why bookkeeping is important, there are several different types to choose from, such as: single entry, double entry, bookkeeping software, and virtual bookkeeping – the most basic of which is the single entry system. This system uses one entry for every transaction. While that keeps things simple, it does not give accurate information for key pieces of financial data, such as: profit and loss, assets and liabilities, and the true financial position of the business. On the flip side, the double entry system takes a more robust approach, but requires an expert to manage and may not be suitable for every small business. Business owners also have the option of using software if accounting is not their area of expertise and they cannot afford to hire an in house expert. However, software programs do have their limitations. You will have to know which software is the right fit for your business, how to set it up correctly, and how to keep your financial data secure.
The fourth type is virtual bookkeeping. This system allows business owners a cost effective way to collaborate with financial professionals without having to hire a full time expert, learn new and expensive software, or figure out how to do it all themselves. At Clem Collaborative, this is a signature service that we offer. We believe that what every business needs is the ability to have a virtual financial office with a team of experts making sure your business is financially healthy and in compliance. We bring 30 years of experience to your business, use cutting edge software to ensure speed and accuracy of financial reporting, and utilize a client portal with best in class security so you never have to worry about your data being compromised.