Thursday, 12 Jul 2018
From a cosy coffee shop to a big media conglomerate, every business needs to keep track of its income and expenditure to maintain the sustainability of the venture. Bookkeeping allows the entrepreneur to assess the financial health of the company by evaluating the current incoming and outgoing capital. It is beneficial in ascertaining the challenges that may crop up in the future and helps in envisaging realistic long-term business objectives.
From sending out invoices to clients to paying the bills on time and saving the company from overspending, efficient bookkeeping assists in organising and streamlining the transactions and funding. Without a proper accounting procedure in place, the entire set-up of the company can go haywire.
Picking the pieces from the chaos can add to the already stressed life of the business owner who is multitasking to supervise various job functions within an organisation. Thus outsourcing the job of maintaining the books to a professional and experienced bookkeeping company in Melbourne can take the load off the shoulders of the owner.
The stress of not knowing about the actual capital available, stack of piling bills, overdue invoices, and missing entries from the balance sheets can give nightmares to any entrepreneur. A bookkeeper can sort out these problems without causing any confusion or mess. Here is the list of benefits that a proficient bookkeeper can bring to the table to take a business from stress to success.
According to the Australian Securities and Investments Commission, every business must have a record of an array of financial documents including financial statements, general ledgers, cash records, sales and debt records, loan documents, invoices received and paid, deeds and much more.
These records are critical as the company needs to provide their copies when an auditor or an entitled officer visits to inspect the company accounts. Also, it is a legal requirement to keep track of all the business transactions for a minimum of five years. A professional bookkeeper takes charge of putting all these papers in order for utilisation by the company.
It is common for entrepreneurs to go into an overdrive mode when the tax filing date is approaching. It is absolute mayhem if the papers are not in order and the owner is struggling to get the documents ready for the tax season.
Besides making it a stressful exercise, last-minute putting together of bills and profit and loss statements can lead to the filing of inaccurate or incomplete records that can lead to legal consequences. Thus it is a sensible decision to outsource the task to a seasoned bookkeeper in Melbourne who will file the papers in compliance with the government regulations without creating any disorder.
Keeping the books in an orderly fashion implies that it is easier to analyse and evaluate the flow of money into the business. It gives a clear picture of the financial stability of the company and helps to pay off the debts without reaching the overdue threshold.
Additionally, it makes sure that the payments are received from the clients in time. The financial statements help to evaluate where the money is being spent which in turn assists in cutting down wasteful and unnecessary expenditure before it turns into a full-blown financial crisis.
With the help of well-maintained business records, a company can leverage a range of tax deductions, rebates, concessions, and offsets to considerably bring down the amount to be paid as taxes.
Bookkeeping makes it easier to claim tax deductions on a majority of the expenditure (namely operating and capital expense) incurred while operating the business to reduce the size of the taxable income. Thus a lot of money can be saved by bookkeeping which would have otherwise been lost in taxes.
With yearly records reconciled to avoid any mistakes, the owner can accurately measure the profits through each of the fiscal years. It gives the foresight to plan for the future expenses as well as create an expansion strategy.
A seasoned bookkeeper can further advice the owner to devise strategies that will prove beneficial in gaining higher returns on investment and generate increased margins. They will also manage the payroll which will leave you with ample time to concentrate on other business functions.
Every business needs capital investment from financiers like angel investors, venture capitalists, and banks. However, each of these entities is sceptical about putting their money into an intangible business idea.
Securing funding needs proof of the success of the business plan on papers which get documented in the form of financial records. Thus bookkeeping comes in handy when the owner is seeking incremental funding for a new product launch or penetration into a ne w market.
Nobody likes crunching numbers, and the mere mention of maintaining the ledgers can give a person sleepless nights. That is why it is necessary to leave the job to professionals who can accomplish the chore effortlessly. The owner gets the much-needed peace of mind knowing that the company accounts are in the hands of a professional which will help in saving time, money and effort.
Most small business owners end up multitasking to reduce expenses but this leads to the negligence of the administrative work and tracking of financial transactions goes for a toss. With the help of a qualified bookkeeper, they can delegate the work related to payroll management, tax filing, and management of books to a responsible professional who can alleviate the stress and set them on the path of success.
