Bookkeeping basics

Introduction
Your accounts can only ever be as accurate as the books you keep. In this section we explain the books you will need - and those you won't!

Cash Book
This is your single most important "book". It records all of the payments made into and out of your business's bank account. It is crucial to set up the book appropriately at the commencement of business. Your accountant will help you with this.

Sales invoice file
It is both very helpful to your business, and reassuring to the tax man, if you issue your sales invoices in strict numerical order. You should also set up a file with file dividers for each month and file your sales invoices in strict numerical order. The only exception to this rule is that unpaid invoices should be kept in a special section at the front of the file until they have been settled, at which point you should mark the invoice "paid" and also write on it the date paid, and then file it in strict numerical order. You should also regularly review the unpaid section of the file and take steps to chase up payment as often as possible.

Purchase invoice
This is a file with a file divider for each month and a front section file for unpaid bills. On receiving an invoice, file it in the unpaid section until such time as you pay it. On paying the invoice you should write "paid" and the date on the invoice itself, and then transfer it from the unpaid section of the file to the section for the month in which you made the payment. You should also, of course, ensure that the payment is recorded in your cashbook.

Source: http://www.freelanceuk.com/

Top 10 Reasons To Use A Professional Bookkeeper In Your Small Business

If you are an Entrepreneur trying to run your business and also handle your own record keeping you should READ THIS:

Having your company Financial Records set up and maintained by a Professional is vital to growing a successful business. As a small business owner, you may be deliberating about whether you should or can afford to use the services of a Bookkeeper.

Here are 10 reasons why it is not only advisable, it could be critical to your survival as a business owner.

Reason 1: You can spend more time on areas of your business that generate revenue, areas where you excel, areas that you enjoy

Reason 2: It will eliminate the frustration of trying to figure out how to do it - and/or how to correct errors

Reason 3: Having data properly recorded eliminates overpaying, or double paying bills

Reason 4: Having accurate records will show you if customers owe you money

Reason 5: Having current figures will eliminate problems with bank accounts like overdraft fees

Reason 6: Maintaining good records will save you time when looking for information

Reason 7: Providing your Accountant/ Tax Preparer with properly maintained records will help to lower their fees and increase the accuracy of the tax reporting. Which also lessens the likelihood of problems with the taxing authority.

Reason 8: Having expenses properly categorized enables you to take all the deductions you are entitled to - reducing the amount tax you have to pay

Reason 9: Reports generated from current, accurate records provide valuable information that can be used to make decisions about your business

Reason 10: Delegating tasks, starts you on the way to growing your business.

About the Author: Rosemarie Zera has been running a Bookkeeping and Tax Service Business for over ten years. Recently moved to San Antonio, Texas. Wrote an ebook entitled "Keep Your Books = Grow Your Business." More information and resources can be found on website: http://www.thecalculatedsolution.com

Source: http://ezinearticles.com/

Cheque Tips for Safeguarding Your Business

In the last Profit Pointer, we provided some tips on safeguarding your business against bookkeeper fraud. One of our tips was that you be the first person to review your bank statements each month. Below are more tips that deal with writing cheques.

• Get a banking package that returns your cheques to you each month. This gives you the ability to physically review all the cheques that have passed through the account.
• Look at the signature line on all of your cheques. With the prevalence of automated banking, the signatures on cheques are no longer verified by a human being. This means that cheques with no signature or fake signatures (even crude fakes) can pass. Make sure it's your signature on every cheque.
• Write post-dated cheques with extreme caution. Again, because so many deposits are put through automated banking machines, cheques are often not manually reviewed until after a deposit has been made. A supplier can deposit a post-dated cheque at any time and there's a good chance it will still go through your account.
• Match up cheques to a supplier's invoice. If there's no invoice, investigate. Where is this money really going? Also, keep an eye out for phony or inflated invoices. One way to minimize the risk of a phony invoice is by having purchase order numbers and matching those numbers to invoices.
• Keep an eye out for duplicate cheques. One bookkeeper had a nice racket going with the two partners of a firm. Each partner had full signing authority on the bank account. Every month, the bookkeeper would present a cheque to the first partner for her invoice. She would then present an identical cheque to the second partner for the same invoice. Because neither partner checked the bank statements, no one was the wiser.
  

Source: http://www.lastminutetraining.ca/

An Overview of Web-based Bookkeeping Solutions

Web-based accounting first came on the scene in the late 1990s as an alternative to desktop accounting. Today there are myriad solutions to help you manage your books online, including Bizfinity, eLedger, NetLedger, QuickBooks for the Web and ePeachtree.

When you use an online application (sometimes called a hosted solution), you contract with a service provider to securely store and back up your financial information. You access your financial records online by entering a password, and the service provider is responsible for providing software updates, security and data storage.

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