Have you been handling your small business books on your own? Many entrepreneurs and very small businesses track income and expenses in what is known as single-entry accounting. But as you grow, you should consider the value of switching to double-entry accounting. What do these terms mean? Here's a short guide to how this change will help you.
How Does Double-Entry Accounting Differ from Single-Entry?
In single-entry accounting, each transaction to enter into the books is recorded by itself and independent of any other transactions.
As a small business owner, you want to avoid going into debt at all costs. However, you may lack the skills and knowledge to know if, how, and when to save money. You also may not know how and where to cut costs when running your company.
Instead of relying on your own lack of objectivity and skill to manage your business's money, you should rely on the advice of an outside consultant.
As a business owner, you are responsible for protecting its cash flow and profits. However, when you rely on outdated bookkeeping methods, you could make grave mathematical errors that cause you to lose money. You also may simply lack the time to handle your book work entirely.
Instead of risking your profits and ability to make money, you can use new software programs like Quickbooks for your business's accounting. You can learn how to use it to your business's advantage by taking Quickbooks training.
As a certified public accountant, you are expected to know how to use the latest software and programs for your industry. However, when it has been some time since you have upgraded your formal training, you may need to enroll in some lessons to update your knowledge and experience. Rather than enroll in on-campus classes, you can instead sign up for virtual lessons. You can take advantage of what courses like Quickbooks online training can offer to CPAs like you.
Has a lender or other potential investor asked you to provide audited financial statements? While this request may surprise new small business owners, it's not an uncommon request to receive. And it can help your business in surprising ways. Here's what you need to know about audited financials.
What Makes Audited Financial Statements Different?
When you approach a lender, investor, vendor, or other institution to extend credit or take a financial stake in your business, you generally provide them with financial documents.