5 Easy Ways to Take Control of Bookkeeping Without Wasting Your Time Don't let bookkeeping duties slide because they are a crucial part of running your business smoothly. Here are five ways to manage your books without draining your time.
By Mark J. Kohler •
Opinions expressed by Entrepreneur contributors are their own.
Being smart about your bookkeeping will save you a lot of heartache and effort when it comes time to file your taxes. But most entrepreneurs I talk to don't know where to start.
Please know that your goal to have a better bookkeeping strategy is not in vain. There are quite a few reasons why bookkeeping pays off and is crucial to your business:
- You can capture all expenses and not miss write-offs.
- Making better management decisions throughout the year will be easier. You won't have to wait until months later to analyze income and expenses by category.
- You'll be less stressed and frustrated knowing your books are being taken care of.
- You will save money on bookkeeping fees rather than "cleaning up a mess" at the end of the year.
- Proactive tax planning throughout the year will save you more on taxes when it's tax time.
It all starts with having a system so that you are not a slave to your business and bookkeeping, but are in control. There are generally five ways to develop a strategy and feel the freedom of having your books in order.
1. Do all of the input and learn the basics of QuickBooks yourself. I know this strikes fear in the hearts of many. In fact, this may be why your books aren't getting done currently. I highly recommend you take time to learn the basics of bookkeeping. You need to at least be able to print out reports and check the accuracy of your staff doing the work. But you still may want to hold off delegating any part of the process and dedicate a few hours a week to basic input and managing the process yourself.
2. Hire a family member to do the work. I love this idea when you have teenagers or young adults you are supporting financially. This is a great way to make them earn their keep and learn about entrepreneurship in the process. They will learn about the heart and soul of small business by doing the books and recording income and expenses. It's also a great tax write-off to have them on the payroll.
3. Engage a local bookkeeper. This could be a local college student wanting internship or externship hours. It could even be a seasoned bookkeeper with reasonable rates. This can be a very affordable option that frees your time to make money for the business. This is also a natural step in the growth of a business.
4. Bring someone "in house" part-time or full-time. You would be amazed at how quickly you can find a local college student or bookkeeper wanting to pick up some part-time work for an hourly wage. You could have this person come by the office daily, or just a couple days a week to input data and print out reports. You'll need to provide some supervision or have your outside CPA train and supervise your in-house bookkeeper. It can be extremely convenient to have someone in-house available to keep things in order.
5. Use your CPA or tax professional throughout the year or at tax time. Many small business owners like the comfort and security of having a highly skilled professional do both their books and tax planning. It may seem more expensive, but the impact of better long-term planning can far exceed the cost. Certainly the more mature business and seasoned business owner will graduate to a more experienced bookkeeper when the time is right.
This is a perfect time of year to get things put together so you can jump on your tax return quickly in the spring and be ready to start 2014 with better data. Remember: it's not just about tax deductions; it's the power of having better information to make informed decisions quickly and effectively.
