First, what is a bookkeeping? Bookkeeping is the process of recording all financial transactions made by a business. The output will be produce financial statements every month and usually fall into three simple categories:
● Balance sheets;
● Income statement; and
● Statement of cash flow
At the end of every year, these statements are reviewed, and income tax is filled in based on data provided in these books.
Please consider the following information to think if you want to start your bookkeeping:
1. Basic financial knowledge
Bookkeeping doesn’t need a lot of expertise or experience in financial. If you already know basic financial knowledge, you can start plan to have bookkeeping.
2. Accounting Software
Accounting software needed to make the bookkeeping easier, that’s why it is essential for you to buy the necessary software. This is comparatively expensive, so it’s better if you just stick to one software.
3. Manpower and Training
Make sure you can have training period to every employee that you have, to figure out the performance and how much of the work is the employee able to deal with without making any major mistakes.
4. Investor
If you plan to have potential investor or scale your growth, you can start to maintain your bookkeeping because sometimes potential investor will conduct some financial due diligence to check your financial information recorded properly and timely manner.
These are some of the important things to consider before you plan to start your book-keeping. For the people operating their organization and want scale up and growth their business, it's important to maintain the records and have a good bookkeeping record.
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