Having a successful business comes with accounting for every detail. Failure to see even the smallest thing can result in something bad for your small business. Best practices will help your business in being more productive, as well as improving your experience. With small business accounting is it important that the results of your work is reviewed regularly. Having a checklist provides you organization and lets you know what is necessary to keep your small business flourishing.
15 things to do when running a small business
It is important to have an organized system with things that you do daily, monthly, annually. Keeping everyone within your company up to date with changes and instilling your trust in them will always result in success and fortune.
1. Do your research:
When running a small business, it is your duty to find out what you want to achieve with your business. With doing extensive research, you can find out what type of employees to hire, what customer service goals you would like to reach and how other companies have dominated the field your business is in. This way, you can learn how to prevail as well.
2. Share your information within your company:
By doing so, you are making sure that everyone involved with running your small business will understand the practices being implemented and how help the company prosper.
3. Involve everyone:
Your whole staff should have an important duty in the betterment of your small business. This way everyone has a role in the work and can offer feedback on what they think may or may not be working. Each person will held accountable for their own job and put out their most excellent work to the best of their ability.
4. Make sure the best practice you are implementing is the best one for your company:
When running a small business, contacting experts on your business is always a good thing. Even so, make sure to know your small business the best. Secure your business with practices that best suit it.
5. Keep constant record of your cash:
Knowing what your cash looks like on a daily basis is important because it is the backbone to your business, Have knowledge of incoming revenue and money that is expected to leave your company as well. There is never any harm in keeping up with your company’s expenses.
6. Have a record of every transaction
Whether it is billing customers, accepting cash, or paying vendors, all transactions should be recorded for future inquiries. With the advancement of technology, software like QuickBooks can be used to oversee everything within your small business.
7. Record and File Receipts
Making a file of all the receipts in the order of your choice is key to organization. Listing them by month, or alphabetically can always make it easier for when it is tax season. Once again, with technology, small business can use software that allow you to scan al the paper receipts.
Tracking your accounts and being on top of paying your suppliers on time is the best way to avoid late fees and keeping positive relationships with your vendors.
8. Analyze your estimated cash flow.
It is crucial that you have an effective way of managing your cash flow. It is especially important during the initial stages of your business. Calculating how much money you will need can help you in maintaining enough for bills, suppliers and paying your employees. You can review your cash flow by coming up with a statement that shows what’s expected in your near future and what you currently have.
9. Balance your business checkbook.
The same way you would want to account for personal expenses is the same way you should treat your company’s expenses. Ensure that your cash business transactions are correct without error and you are working with the correct cash figures. Constant review of your cash makes it less difficult to find and/or correct errors or exclusions.
10. Evaluate the status of your inventory.
Make it important to out a time to order necessary products for your company. Analyze what products sell more quickly than others and regularly make modifications so you do not have excess or low amounts of your product.
Annually, reviewing your current inventory helps you determine what items have sold and have not. For tax purposes you can take note of the inventory that hasn’t been sold, that way you do not have to spend additional taxes on those items.
9. Examine payroll and authorize tax payments
Meeting payroll requirements based on local, state and federal laws is important. Make sure that you are reviewing the payroll summary prior to making certain payments to refrain from making mistakes. Have an employee learn the payroll system which will help you save time and effort.
11. Makes sure your quarterly payroll reports are in order.
The IRS requires quarterly payroll reports, as well as payments. A smart tactic for accounting within a small business is to review everything thoroughly to make sure it is consistent.
12. Analyze actual income vs. Budget and Prior Period, Quarter or Years.
Your income statement tells you how much cash you have used toward your business. Weighing the numbers against your monthly, quarterly or annual budget demonstrates where you might have spent too much money or not enough. This way you can make significant changes.
13. Fill out IRS Forms.
The IRS has a deadline on February 1st which necessitates the report of annual earnings of your full time employees and independent contractors. These are the W-2 and 1099 forms. The target date requires that you mail copies of the tax forms for employees.
You must file with the IRS no later than February 28th.
14. Approve and Review Full-Year Reports and Tax Returns
Around tax season, go through your company’s financial reports from the year prior to giving them to your accountant. Review and analyze thoroughly before signing for accuracy based on your business’s full year financial reports. If you are audited by the IRS and they find you haven’t paid the right amount in taxes, additional taxes, penalty and interest will come to you.
15. Do not be afraid of change.
Lastly, growing businesses should always have room for change. As a business gets larger, the staff should recognize that things can change at any given moment. Remember not to get to comfortable. Embrace the change.
Author’s Bio
Maqsood Rahman Founder of Level Ten Solutions, a top New York SEO Company. He is an SEO Consultant & Working in digital marketing industry since 2006, currently living in New York City. He is addicted to technology and media trends and helps other companies with content strategies.