Good record keeping is good for business

One survey of businesses filing for bankruptcy reported that 58% of respondents did little or no record keeping. At a minimum keeping good records of sales, expenses, and debts is critical for business survival.

Of the surprising reasons for business failure, this is probably the easiest and least expensive to prevent. Here are some things to do:

• Set up an accounting system that will record all financial transactions. Using a system such as Quick Books ensures that you will have a workable system.
• Use the accounting system! Use it to write invoices, pay bills, and reconcile the bank statement. Print reports showing your cash balance, what your are owed by customers, and what you owe vendors.
• If you have two or more employees, have a payroll service do your payroll. This will not only save work, but will ensure that payroll records are properly maintained and that taxes will be paid on time.
• Create a financial projection for at least one year that shows how much money you expect to have come in each month, and how much money you expect to have go out. Use this to help guide your business decisions.
• Have a professional (your accountant) review your financial records at least once a year.

Will Limkemann