Managing your business accounts

 Managing Your Business Accounts.

Managing your business accounts

April is tax time - are you and your business ready?

Paying taxes is just one of the various accounting tasks that entrepreneurs will face in running their businesses. For many entrepreneurs, dealing with accounting procedures can be a daunting exercise, especially if they are heavily involved in day-to-day business activities.

Accounting is integral to business success.

Som pays little attention to maintaining business accounts, and more to generating sales and managing staff. However ignoring tax obligations will create more problems for businesses, as penalties for non-compliance or reporting incorrect information can be costly.

Although you can hire someone full-time or part-time to handle your bookkeeping, it's still worthwhile for you to learn about some of the key elements of the accounting process. You must take an active role in managing your accounts so you understand what the data means for your enterprise.

For example, monitoring your data can allow you to keep track of delinquent customers or quickly recognize when your input costs are rising. Knowing your monthly profit position can help you adjust your prices or processes and make strategic business decisions on a timely basis.

Keep proper financial records.

When running a business, it is very important for you to keep accurate and timely records of your income and expenses as well as payments to your employees. Without a system to capture this information, you may find it difficult to keep up to date with your tax reporting requirements.

Keep all bills for your purchases and expenses in manila files by the proper date, and keep copies of all receipts sent to your customers. Keep detailed records of all personnel matters, including legal deductions and correspondence regarding their conduct or performance.

You can purchase an accounting package that allows you to record your accounting transactions in-house. However, if your work is complex, it may be useful to hire a professional accountant, as it may be difficult for you to understand all the intricacies of the tax system.

Save your records.

Once you have collected and recorded your financial records for a year, it is important to keep them in a safe place. You need to keep all your documents for the required number of years, in case the tax authorities decide to audit your records to ensure that you are in compliance.

It is advisable to store your documents in a filing cabinet or strong container that will repel insects or prevent damage from the elements. You can also scan important documents and keep the information in an electronic format, or email them to yourself for added security.

Use an appropriate filing mechanism to store your records, so they can be easily located when needed. You should also make clear notes on any documents that may contain unusual transactions, so someone else can understand what may have happened a year ago.

Despite all the work you do to keep your business afloat, it's important to take the time to keep careful and clear records of all your financial information. Not only will this help you plan for the future, but it can also protect your enterprise from tax challenges.