There is nothing so exciting as starting a new company or venture. You have enthusiasm for everything and your venture got off with a good start. However, do remember that you would need to take care of some administrative duties that can make or break a company if not adhered to. In this regard, you should consider basic bookkeeping for new business start ups.
You will not get away from the fact that accounting is a key function of any business, whether it is a corporate or a one man small concern. If you follow good accounting practices from the beginning, you are going to maintain accurate figures. Your books in turn will reflect whether you are making a profit or whether you need to address some overspending.
Another reason why it is important to keep books is when you ask the bank for a loan. They will not consider you if you cannot produce a set of books on your company to help them make an assessment whether to take the risk or not. With coherent accounting practices, you stand a better chance of getting that important cash injection.
In this regard, there are some rudimentary guidelines which everyone should follow to make their venture run smoothly:
Never use the same credit card to do company and personal transactions. It is important to have a special company credit card so that all your transactions for the venture are done through that one. Your accounting will be less stressful because you will automatically see how much is coming in and going out of that account. All deposits for instance must go into this business account and not into your personal account.
You can also track personal funds used to pay company expenses if you cannot use your company card. If you have to reimburse yourself you should also do it through one account. By doing this, you would clearly identify what money has been spent by you on a business transaction. It saves time and effort by doing it right from the start.
Your bank statements should be reconciled once a month. Buy following this practice, you will see that each month your funds are growing and you will have a better picture of how frequently you are spending your money and on what. Also keep a note of any expense you make, because when if comes to reconciling you might not remember what you bought.
Consider buying software such as Basic bookkeeping for new business start ups. It will help you with your administrative duties and keep you focused so you can take on the world.
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