If you've set up your own business, you may be in the position now of determining which is the best book keeping system for your business. You have your product offering, you chose your entity, and you launched your marketing campaign. You’re not done yet, though! Most people forget the bookkeeping part or leave it to the very end, but it’s a crucial part of your business. You might be thinking: “I don’t have any sales yet.” “My sales volume is too low – there is no need for bookkeeping!” Bookkeeping isn’t just about sales. If you’re like most new business owners, you probably had some start-up expenses, like registration of your new entity, office supplies, business cards, creating your website, and perhaps even ads to drive traffic to your new site. While keeping track of your income is key, tracking your expenses is just as important.
Setup your book keping system from day 1
Set up your bookkeeping system from the beginning, and then you can simply update and review it quarterly or semi-annually. However, DO NOT skip the initial set-up. You will forget about your out-of-pocket expenses and miss out on deductions. The longer you wait, the busier your business will get, and the harder it will be to go back and set up your bookkeeping. Money (or rather, lack of it) is no longer a valid excuse.
To pay or not to pay
There are free bookkeeping tools available to you – a quick Google search for “free bookkeeping tools” gives you a list of options. There are also a variety of open source applications available too. The benefit of choosing an open system is that changes can be made to it that benefit all users.
Which is the best approach for you?
You have three options to set up your bookkeeping system:
Do everything yourself (DIY): find a system, set it up, and keep track of everything yourself
Hire a professional for setup: hire someone to set up everything correctly for you, and then you handle the day-to-day data entry and management. Ideally, you want someone with a bookkeeping and tax background so you’re covered in all areas.
Hire a professional to do it all for you: hire someone to handle your setup and day- to-day data entry and management. You can either outsource everything or a couple of your bookkeeping tasks. If you have some accounting knowledge or have done extensive research on the topic, doing everything yourself could be a good option. However, if accounting and taxes are not your forte, we recommend that you at least have a 1-hour consultation with a professional to help you with the set up and give you tips specific to your business.
Is outsourcing the right approach for me?
If you dread the idea of having to do your books, then perhaps outsourcing everything to a professional is your best choice. Don’t have resources to pay for monthly bookkeeping? You may be able get quarterly or semi-annual packages. Many accounting & consulting services have flexible packages for start-up businesses.