Whether you are a startup or an established business, keeping track of your finances is very important to make business decisions informed. That’s when accounting and bookkeeping services come in.
Accounting is the process of tracking income and expenses. An accountant is responsible for offering strategic financial advice besides being aware of the company’s financial situation.
Bookkeeping services are the process of maintaining financial transaction records and preparing financial statements, such as the balance sheet and income statement. In daily operations, a bookkeeper will ensure employees submit faking and expenditure correctly and handle payroll.
In this lesson, we will be in-depth about accounting and bookkeeping services so you can make decisions about whether you can handle their own tasks or need to hire someone.
Services
A bookkeeper is the official recording of your business financial recording. An accountant is your financial strategist. This professional is responsible for preparing audits, assisting you with tax planning, and offering business financial analysis and suggestions.
Accounting and bookkeeping services can be handled by one individual but before you make a decision, find out what is usually involved every task.
Bookkeeping
Maintaining a clear business record is important. This helps you understand how much money is payable to you, how much you owe and will prevent you from making expensive – not to mention illegal mistakes. It can also help you monitor your business and identify income sources.
Below is a list of records that you must save accurately and orderly:
- Payroll and employment taxes
- Sales and purchases
- Expenses
- Bank statement
- Fortinet Statement and Loss
- Cash Flow Analysis
Accounts and business debt are also two important notes to be saved. Accounts receivable is a claim of uncollectible amounts, usually from credit sales. For example, sales have been made but money has not been collected – only credited.
Accounts payable is the amount owed to vendors or credit for goods or services that have been completed. For example, small businesses may have short-term payments to the bank.
Tax Planning
Planning and archiving taxes is not pleasant but it is very important to ensure everything is handled properly. In addition to reducing archiving errors and preventing unnecessary audits, an accountant can help you save money. Because it is their duty to stay up to date with the tax code and regulations, they will be able to tell you about how much money you need your business to be set aside – so there is no surprise.
Audit.
Before you panic – An audit is not always bad! The feared “IRS audit” occurs when a business does not archive their tax correctly. However, it is also quite standard for businesses to be audited when banks or investors want to understand their financial position to risk before they invest capital.
When it comes to preparing audits, your accountant can be your best friend because they will save a lot of time preparing for the audit.
To prevent your business from getting “the bad audit”, here are some tips to follow:
- File and pay your taxes on time
- Don’t incorrectly (or forget to) file business sales and receipts
- Don’t report personal costs as business expenses
- Keep accurate business records
- Know your specific business tax reporting obligations
