Organizing your accounting records could be time-consuming if it does not follow through a systematic approach. By doing it systematically, you’ll be able to save a lot of time when keeping your accounting records as well as give you a better understanding of your company’s performance. What’s more, it also helps in paying salaries smoothly, performing tax returns in Singapore and allows you to keep a close eye on business transactions with a peaceful mind.
Through this article, you’ll be able to organize your accounting records properly with these five tips.
1. Keep professional and personal accounts separate
To avoid any kind of confusion about your business finances, you should always keep your professional and personal accounts separate. By doing so, you can have a clearer view of your tax-deductible business expenses. Additionally, you should also keep your credit cards and overdrafts separate from personal ones.
On the other hand, you should not use business expenses for your personal transactions, even if it is a small expense made. It will affect your business in the long run. So, try to keep your professional and personal accounts separately.
2. Keep receivable and payable accounts separate
You’ll be able to get an idea of how much your clients have paid so far and how much overdue the total payment is by keeping separate records for receivable and payable transactions. This will help you to maintain a smooth cash flow and ensure that no overdue payments are overlooked.
On the other hand, payable accounts make sure that you are not behind with supplier payments.
3. Go digital
Now, you no longer have to file or store your receipts manually. There are plenty of professional software out there that helps you to better manage your accounting records. You can keep your financial records secure by opting for a digital platform, which will store your files on a cloud-based system. So, there will be no risk of losing any information. The digital storage of files even makes retrieval of your documents a lot easier as compared to storing them physically in your office premises.
4. Avoid cash payments
It is better to avoid any cash payments for your business finances apart from the smaller ones. You should use credit cards instead for any business transactions that needs to be made, so that it is easier for you to keep track of your payments and records.
Tracking expenses paid through cash payments can be really difficult and time-consume as well. Despite this fact, you should still record these payments too. Every transaction is significant and missing out any can prove to be detrimental for the business. Do not forget to reimburse the customer immediately with an expense form to avoid confusion later regarding taxes or business transactions.
5. Hire professionals
Bookkeeping can be a strenuous task and it is better to leave this task to professionals. It is a very complex task and you have to pay close attention to every financial activity that takes place regarding your business. You should look for an experienced professional that provides accounting services in Singapore to ensure that he or she manages your accounting records properly.
With these tips, you’ll be able to manage your accounting records without any difficulty. There is no rocket science needed to maintain your accounting records. You just have to record your business transactions all the time. You cannot afford to miss out this bookkeeping process even for a one day as it will create problems for you.