If you’re operating a small-sized company you should have a firm grasp on your finances. You shouldn’t make any decisions that impact your company’s profitability without understanding the amount of money going in and out. Many small-scale business owners struggle with this aspect of their business, especially those who aren’t familiar with bookkeeping.
The method you write your assets into your books, along with your accounts payable and receivables can affect the efficiency and effectiveness of your business. This article explains how to arrange business transactions to improve your financial performance and comply with regulatory requirements.
When you’re organising your business’s financial transactions the first step is to separate your personal and business expenses from each other. This means using your company bank account to make all business purchases and an excel spreadsheet to record all business expenses. It’s also important to keep invoices and receipts properly organized, if they are not in electronic format or format, then place them in a filing system with specific categories.
It can be a challenge to keep track of business transactions since there are so many ways to keep track of the transaction. However there are a few best practices to follow to keep track of financial records. For example, try to file your receipts on a daily basis or at least weekly (Friday afternoon, for example). Use an app or receipt management software to digitize receipts and bills on paper.