What exactly is an accountant or bookkeepers role in your business…
I’m just going, to be frank with you, not everyone has the know how to manage their personal or business finances. I know we all think we have our own system of managing but when it comes to your business finances it’s best to leave it to the professionals to do it themselves or to educate yourself on the three basic financial reports: 1) income statements 2) balance sheet 3) cash flow statements.
The first question I ask clients when coaching them or consulting them is, “how much did your business make last month after operating expenses?” You know what the answer is….. Ahh, I think I made.Well, that answer isn’t good enough for me because as a business owner you shouldn’t think, you should know! As my mentor once told me, “If you ever get too busy to check your financials you don’t need to be in business anymore.”
Why is bookkeeping so important to startups:
- Proper bookkeeping makes for good record audit proof
- Bookkeeping keeps track of any information or documents needed to fulfill annual tax obligations to help the account help you to save money on your tax return and eliminate penalties.
- It can give you a better knowledge of your monthly financial analysis & cash flow management.
- Reporting to investors is easy
- Proper records of balance sheet and profit & loss allows you to know if the company is on the right track financially
- The reports will help for your business to grow from startup phase to the mature stage of business.
Remember, it is important to outline the details of bookkeeping before the launch of your business because later may be too late. Bookkeeping can literally be your road to success and literally save you thousand of dollars or it can be your road to bankruptcy if not initiated from start.