The End of the Financial Year is Upon Us – Who’s Doing Your Accounts?
April 4, 2012
One of the least looked forward to aspect in running your business is in maintaining your accounts. Often as the end of the financial year hits we start to dread the ‘catch up’ process as we update, reconcile and try to remember just what that receipt was for. If budget is not a problem then this ‘challenge’ is solved by simply sending all your information to your accountant to sort out.
If on the other hand you are on a budget there are other options available to you. Your accountant is a necessary part to your business, they will make sure your annual accounts and tax returns are correct as the financial year comes to a close. They will advise you on your setup, your deductibles, your strategy for investment and lending options if necessary. They will also happily do your bookkeeping but there are more cost effective alternatives to consider.
Do It Yourself
By keeping on top of your accounts on a daily or weekly basis, you won’t get into the situation where a ‘catch up’ requires a mammoth effort on your part. Often 15 minutes at the beginning or end of each day is all it takes.
- Low Volume: Organise your accounts using a simple Excel spreadsheet for your cashbook, budget and other records.
- Medium to High Volume: Chose from many of the Cloud based tools available (discuss with your accountant before coming to a decision to ensure he is happy with accessibility, information reported and is compliant/compatible with your country’s tax laws.
- Look at some of the desktop applications available, again after talking to your accountant.
Factors to consider in your decision
- Cost comparison
- If you have employers, does the package offer a payroll module
- Is there an inventory module to assist with stock control, reordering and invoicing [business selling products]
- Is there a job card or time tracking module so all your accounts are in the same system [business selling services]
- Usability; is the software easy to use? How much training will you or your staff need and what is the cost of training
- Updates; cloud based software is usually updated constantly. Desktop applications require upgrading on a regular basis
- Setup; how easy is the system to set up
Using a service, let’s say a Virtual Assistant (!) to do your accounts has the following benefits:
- Frees you up to do other tasks
- More cost effective than using your accountant for bookkeeping tasks
A virtual assistant can incorporate savings and strategies across your business by;
- Sending your invoices and statements out promptly
- Paying your suppliers promptly in order to receive prompt payment discounts
- Source quotes to ensure you are ‘getting the best deal’ and reduce overheads
- Track your actual against budget to ensure
- Provide timely reports so you can plan your business
Time to ‘fess up!
As a Virtual Assistant I enjoy assisting clients with accounts. There is a sense of achievement in balancing the bank reconciliation and saving the client money through supplier sourcing. However as a business owner accounts are toward the bottom of my To Do list! I would much rather write a blog post or participate in a LinkedIn discussion that knuckle down with my folder of receipts!
Your Turn: On a scale of 1 to 5 (with 1 being bottom and 5 being top), where does ‘updating accounts’ rank on your To Do list and what tips would you share to make this task easier?