Streamlined business bookkeeping 

Keeping accurate records

If you are struggling with inaccurate data, being behind or spending hours on the books, there are ways we can help to manage your day-to-day record keeping, leaving you the ability to keep your eyes on the prize.

Keeping good records also allows you to better manage your business. It allows you to make important business decisions based on up to date data, better manage your cash flow, helps with paying bills on time, and managing your tax and superannuation commitments.  

• What does a bookkeeper do for a small business?

  A bookkeeper maintains the financial records for your business. It is their responsibility to complete accurate, timely and tidy data entry and bank reconciliation so you (as a business owner) will always have correct & detailed financial information about your business. Having this is crucial to managing your business - The reports that bookkeepers can produce allow you to see exactly what you have and you can make better business decisions based on current and solid information.

  The main duties of a bookkeeper is data entry (balancing the books), bank reconciliations (checking the books against bank statements and source documents) and providing monthly reports to communicate your businesses financial position. There are other duties, though, which can include accounts receivable and payable, payroll processing, tax filing, end of year reporting and liaison with your accountant.

• Do I need a bookkeeper for my small business?

  Bookkeeping is a crucial component of running a business. Whether you complete the bookkeeping yourself, or hire an accountant or bookkeeper to do it for you, this job still needs to be done as often and accurately as possible. Without clean and correct bookkeeping your financial accounts will be incorrect, which means you will be potentially paying the wrong amount of tax through the year, you won’t have an idea of your businesses finances and completing your financial statements and year end tax returns could be quite costly (due to needing to fix up the errors through the year).

   

Reasons to keep good records

Your record keeping and accounting systems are the bedrock of all your business decisions, without which your chances of success drop greatly. Ensuring you are on top of your bookkeeping and record keeping will:

• Make it easier to complete your activity statements and prepare your annual income tax and fringe benefits tax returns. 
• Monitor the health of your business and be able to make sound business decisions – for example, by keeping track of debtors and creditors. 
• Help you to manage your cash flow so you can pay your bills when they fall due. 
• Demonstrate your financial position to banks and other lenders, and also to prospective buyers of your business.
  
  

• How can a bookkeeper help my business?

  Bookkeepers are there to help your business run smoothly. If you’re a business owner, you already have plenty of hats to wear and often keeping on top of the books is low on the priority list (and can be quite a complex chore!). A bookkeeper will help by both taking the responsibility off your shoulders so you can focus on strategy and growth, and also by ensuring your financial information is accurate and up-to-date consistently so you will have a great understanding of your cashflow (making sure you never run out of money).

Tax and superannuation records you must keep

You must keep records of all transactions related to your business’s tax and superannuation affairs, including records that support the information you include in your tax returns and reports- external site.

The records you need to keep depend on the tax and superannuation obligations of your business and the structure of your business (sole trader, partnership, company or trust).

The Australian Taxation Office (ATO) requires that:

• Your records must not be changed and must be stored in a way that restricts the information from being changed or the record damaged.
• You need to keep most records for five years, starting from when you prepared or obtained the records, or completed the transactions (or acts they relate to), whichever is the later.
• You need to be able to show the ATO your records if they ask for them.
• Your records must be in English or able to be easily converted to English.
• We recommend you check the record-keeping requirements of all organisations you deal with.
  
  

• How long do you keep business records for?

  Under tax law, you must keep records of income tax, goods and services tax (GST), payments to employees and other business payments for five years after they have been prepared.  There are also record keeping requirements for many other measures including workers compensation.  Under Australia’s workplace relations system, you need to keep employee information such as time and wages records for seven years.

• Do I need a bookkeeper for my small business?

  Bookkeeping is a crucial component of running a business. Whether you complete the bookkeeping yourself, or hire an accountant or bookkeeper to do it for you, this job still needs to be done as often and accurately as possible. Without clean and correct bookkeeping your financial accounts will be incorrect, which means you will be potentially paying the wrong amount of tax through the year, you won’t have an idea of your businesses finances and completing your financial statements and year end tax returns could be quite costly (due to needing to fix up the errors through the year).

   

Paper is out - Why electronic bookkeeping is key

The ATO is moving towards all electronic records. So, now may be a good time to go electronic. Some advantages of digital record keeping include:

Helps you record your business transactions, including income and expenses, payments to workers, and stock and asset details 

• Automatically tallies amounts and provides readymade reporting 
• Can produce invoices and provide summaries and reports for GST and income tax purposes 
• Keeps up with the latest tax rates and tax laws, and rulings 
• Allows you to report certain information, such as your activity statement, to us electronically 
• requires less storage space 
• Allows you to back up records and keep back-ups in a safe place in case of fire or theft 
• Enables you to use your time more efficiently
  
  

• What are the available software for online electronic bookkeeping?

  The most commonly used accounting software around right now would be Xero, MYOB, Quickbooks, Reckon, and Sage. There are a great many software’s out there and we’d recommend doing research on the costs and features of each before committing (as it really depends on your business needs). 

  From the two main competitors - Xero and MYOB - the key differences to consider would be:

  • Pricing - Xero’s pricing are much more straightforward with monthly pricing tiers that mostly provide the same product, whereas MYOB is more complex with different packages, pricing and limiting functionality of the product depending what package you are on.
    
    
  • Invoicing and Inventory - Xero has an entire marketplace of third-party add ons making customisation to your needs a breeze.
    
    
  • Online & phone support - MYOB provides the benefit of business-day phone support whereas Xero does not. Although Xero has an incredible amount of support resources online, online support, an entire community online to help, and as always, Trekk Advisory will be able to support you through your Xero queries anytime.