Best Accounting for Small Businesses

Accounting for small businesses is one of the essential functions you must cover as a business owner. There are dozens of benefits to keeping a close eye on your finances. Some of the ways accounting can help your business include:

Basics of Accounting for Small Businesses

When opening a small business, you may not realize the volume of accounting tasks necessary to manage on a daily basis. Some of the basic accounting functions essential to a small business include: 

Tracking expenses 

You must keep track of all costs and apply them to each customer account (if applicable), so you can properly bill for your time and expenses.

Bank reconciliations

It’s essential to keep your bank account reconciled so you know at any time how much available cash on hand you have.

Payroll

You must pay your employees each week and need a compliant payroll system to complete the job.

Record receipts

As you receive customer payments, you must apply them to the customer account and deposit the funds into your bank account.

Forecasting

Another important small business accounting function is forecasting the future. You can create a spreadsheet and fill it with expected receipts and expenses to plan ahead and analyze spending trends looking for areas to save money. 

Create financial reports

Each month, you must create financial reports like a profit & loss statement, cash flow, and income statement. 

Along with the day-to-day small business accounting functions, you may also have to prepare taxes, plan cash flow, pay sales tax, file reports, and evaluate your finances to plan for the future. Accountants can also help you with financial decisions and obtaining financing. 

Getting Your Finances in Order

Getting your finances in order takes the guesswork out of managing your small business. If you track every receipt and expense, you will always know exactly where you stand financially. You can also use some small business accounting methods to plan for future costs and estimate your taxes. 

When you apply for business loans or grants, it’s essential to have a solid understanding of your finances; lenders will want to see up-to-date, accurate financial reports before they lend you any money. 

Do Small Businesses Need to Hire Accountants?

Even small businesses can benefit significantly from hiring accountants. Most small business owners are tremendously busy managing operations. They don’t have much time to worry about payroll, accounts receivable, and accounts payable. Taking these things off your plate by hiring accountants frees you up to build the business and focus on other things. 

Where to Get Accounting Help for Your Business

When in need of accounting for small businesses, it’s essential to choose a company with longevity and a lot of business experience. Interactive Accountants has over 100 years of combined experience in various business sectors. They can provide everything you need from daily bookkeeping tasks, financial planning, payroll services, financial reports, tax preparation and planning, and much more!