For practical bookkeeping, you first need to understand your business needs.  You will have the best understanding as to how the business operates on a day-to-day basis and you need to develop and implement a systematic approach to record your daily transactions.

Each business will have different reporting needs so firstly, identify what information you want to generate from your bookkeeping system.  Do you need to review weekly reports to monitor performance or do you just intend to record all data on an annual basis?  In the first instance, a formalised accounting package is likely to be the best option whereas a simple Excel spreadsheet would suffice for the latter.

The next step is to think about how much information you have to process.  Again, large volumes of data are more suited to processing on a computer package to keep track of it all so an investment in an IT system would be worth your while.  It may not suit however, to devote resources to such a system if transaction volumes are low or relatively simple, i.e. one or two invoices a month, one or two lodgements, etc.

No matter what stage your business is at, it is always important to evaluate how the system is working for you.  If basic bookkeeping is cumbersome and time-consuming for you, perhaps you need to consider other options – changing the way you record your information, employing someone to maintain your books or outsourcing the task are always available options.  Ask your accountant for advice – from reviewing your records, we can identify areas for improvements to be made and efficiencies to be gained.  With experience of a wide range of accounting systems, we can also recommend appropriate IT solutions to suit your business needs…and without the pushy sales pitch!

See Also:   Productivity Tips

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