Bookkeeping Basics to Maintain

Bookkeeping is vital to the day-to-day of your business. There are a handful of reasons why some businesses fail, but almost one-third fail due to cash flow problems. This can be avoided by maintaining accurate, detailed, and up-to-date books. But, what exactly does that entail? What do bookkeepers do to maintain these records?

Maintain and monitor records.

Know where your business stands financially by maintaining and monitoring your books. A bookkeeper tracks all the ins and outs of your business and makes sure there is no missing or inaccurate information.  

Track debits & credits. 

Part of maintaining your books includes tracking and recording the money going in and out of your business. From there, reports can be made to better show you where your business spends money and how your business makes money. Without the day-to-day tracking of the debits and credits, your business’ financial situation would be a mystery, at best. 

Run payroll. 

Adding new employees to payroll, taking any employees off of payroll, and making sure everyone is paid correctly and on time is also essential to bookkeeping. A bookkeeper will ensure the payroll is set-up correctly and runs without issues. 

Accounts Receivable & Accounts Payable. 

Making sure your bills are paid and your invoices are fulfilled is vital to maintaining accurate records. Bookkeepers send out invoices, payment reminders, and record this data accordingly. It’s important to keep your cash flowing and that can only happen by making sure bills are paid.  

Reconcile. 

At the end of every month, a bookkeeper will reconcile your records with your bank account to make sure everything aligns as it should. If there are issues or red flags arise, your bookkeeper will address these with you immediately and work to make the necessary adjustments so your books can be reconciled correctly. 

Your bookkeeping is the backbone to your company’s financials. It isn’t something that can be left on the backburner until you have time. If you do not have the time or knowledge, work with an experienced and certified bookkeeper.