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Bookkeeping is important for helping you maintain accurate financial records. However, many businesses fail to implement this integral process. You are required under law to maintain accurate books and records. Doing this will also save you from frustration later on!
In fact, "poor accounting" is one of the top reasons businesses fail. Without bookkeeping or accounting, you are blindly driving your business.
Still not convinced that your focus needs to be on bookkeeping? Below are just a few reasons why bookkeeping is important.
When income and expenses are properly organized, it makes it easier to review financial resources and expenses.
We make it easier for you, by doing your bookkeeping virtually. You will never have to come in to the office!
You can have financial information ready for tax time. Instead of scrambling for receipts or invoices, all of your financial information is organized on one central system.
Being organized is a skill every business owner should have. You should be able to find information regarding your business at any time. there are a few parties that are interested in your company's financial records - the IRS, employees, customers, investors and lenders. Being able to provide the information requested by these parties are vital to your ongoing operation.
Business analysist is a tool used by management to analyze business performance. The product of bookkeeping is financial statements which should be regularly generated and used for analysis. While analyzing financial statements, you can track your cash inflows and outflows.
Investors want to know the financial performance of your business to be able to want to quantify the value of their investment. The balance sheet, income statement, and cash flow statement all present the value of your business.
Take control of your business’ finances. Bookkeeping paints a clear picture of how you spend money. It's this delicate balance of cash inflow and outflow that will keep your business going.
Disorganized books can weigh heavy on your mind as a business owner. With all of the other factors of running a business, your bookkeeping should not be keeping you up at night.
In the unfortunate circumstance, you are audited by the IRS, you want to make sure your books are in order. Messy books prolong the auditing process, making your business more susceptible to fees and penalties.
During the growth of your small business you may have tried to cut cost by doing more on your own. However, you should think twice if you lack experience in managing books in a business. Managing your own accounting system incorrectly can hurt your business both now and in the long-term.
The general purpose of the financial statements is to provide information about the results of operations, financial position, and cash flow of an organization. This information is used to make decisions regarding the allocation of resources.