There are basically four ways to manage small business accounting system! Once your business is up and running, you must focus on managing cash flow and the financials of the business or else the ship will begin to sink!
When business begins to grow—new customers coming in, orders come from various places, deliveries become plenty, many customer issues to handle— many entrepreneurs and business managers become engrossed in the day-to-day operations and the running of the business.
Too much success as well as too much failure can destroy a business. Once business is growing, the managers and CEO must begin to plan and develop systems to manage that growth or else the business will shrink to death.
One of the critical areas to plan and manage is business accounting cycle. Basically, there are four ways to manage small business accounting!
Doing It Yourself
At the early stages of the business, you’re the business. You manage the sales, marketing, operations, customer service and the accounts of the business. How skilled and organized you are in these areas will help you do it much better.
If you have basic business accounting knowledge and skills, you may do it yourself manually. However you need training if you’re weak and can’t manage or understand the essence of accounting in your business.
Multisoft Training Services offers accounting training to entrepreneurs, business owners and managers who are in this stage of their business development process.
Subcontracting to an Accounting Firm
As your business grows, you will need a professional to help in checking the accuracy of your business accounting figures and also help design the accounting system. At this stage, it is wise to find a credible and established accounting firm that will coach, guide and help you.
An accounting firm will take the headache out of the daily book keeping chores and process your accounting data into useful financial information and also assist with the interpretation of the figures for decision making.
Hiring an Accountant
Once the business grows, the accounting transactions will become enormous, making it difficult for the business owner or business partners to manage. At this stage, you’ll be replacing the accounting firm with a qualified accountant or bookkeeper. If you choose to use bookkeepers, then it is advisable to retain the accounting firm in a supervisory role.
The accounting firm together with your accountant/bookkeeper will act as the Accounts & Financial Department of your growing business empire.
Investing Accounting Software
At each of the above stages, it is important to support your team with the right accounting tools. Wrong tools will hinder the team’s performance and result in inaccurate data and reports. Accounting firms are likely to come along with their own tools and may also walk away with the tools when their contract comes to an end.
To stay in control and hedge against frequent change of the accounting tool, it may be a good idea to own your own business accounting software. It is synonymous to buying a car and hiring the driver.
Business accounting software helps your accountant to do the work with ease, faster and with greater accuracy. With Sage Business Accounting System, you can get a lot done accurately and in less time.This is not obviously the last step in the four ways to manage small business accounting but rather a step that complements each of the first three. As your business grows, you’ll have to invest in more sophisticated accounting software.
Kindly contact Multisoft Solutions Office for a free consultation on the right tool for each of the three stages.