Keeping Track of Business - The Book-keepers Forum (UK)

Athena · Member

Keeping Track of Business

Man66 · Veteran Member

Hi Athena

You're correct that you need a good book-keeping system. Book-keeping can be made very simple, but it can be time consuming so if you don't want the hassle of doing it yourself, check out the services of a local book-keeper (it will be cheaper than going to an accountant!).

If you want to try doing it yourself you will need to record all your sales and purchases. A paper based system might look suitable for a start up, but it will become more time intensive as you grow, so you may want to computerise your accounts at an early stage. As you're in the US check out QuickBooks which is very simple to use.

Basically you need to keep all your sales invoices and purchase invoices separate, and record them in a suitable manner. When issuing a sales invoices number them to provide an appropriate audit trail. Keep them in two files: Sales Paid and Sales Unpaid.

File your purchase invoices using an appropriate referencing system eg: by number PL1, PL2 etc (or whatever suits). Again keep them in two files: Purchaes Paid and Purchases Upaid.

Use your bank statements to check that you have not made any mistakes, and reconcile (balance) your statements every month. This will keep your year end accountants fees for your tax return to a minimum.

Hope this helps!

Man66

Athena · Member

That helps a lot. At least it gives me some tips for getting started, which is much more than I had before.

In the U.S., taxes are due on April 15, and I got soaked this year because I didn't do a good job of keeping track of my business expenses. I could hardly claim any deductions. So, this year I'm turning over a new leaf and plan to start keeping careful track of everything.

Thanks, too, for the tip about QuickBooks. I'll check it out.

startingout · Member

I learned the hard way about the need to keep info for taxes! Now on the 1st of every year I just label a drawer 2007 taxes. All year, when I may not be thiniking about taxes or have the time, I just toss receipts in there or anything that migth be a deduction. Then, in the beginning of Janary when I start to prep my taxes, I spend a day going through the file from the previous year. It is such a weight off my shoulders at least to know everything is in one place.

Athena · Member

startingout wrote:

I learned the hard way about the need to keep info for taxes! Now on the 1st of every year I just label a drawer 2007 taxes. All year, when I may not be thiniking about taxes or have the time, I just toss receipts in there or anything that migth be a deduction. Then, in the beginning of Janary when I start to prep my taxes, I spend a day going through the file from the previous year. It is such a weight off my shoulders at least to know everything is in one place.

Great idea, startingout! I'll have to try that, too. I definitely like the idea of an envelope or box where I can toss receipts rather than having to sit down and record everything on the compuer or in a book. Your method sounds like a definite time saver!