3 Reasons Why Bookkeeping is Important to Your Business

Who keeps track of all of the numbers in your organization? Is the work split between multiple people? Do you have to squeeze time into your schedule to record sales and process payroll each week between filling orders? Accurately recording your financial information and keeping track of paperwork deserve more detailed attention than many small business owners can give.

Bookkeeping is about more than just helping you to stay organized. This service can help your business reach its full potential. By analyzing your data and helping to identify efficiencies and ways to save or increase profit, it is even likely to save you money in the end. Below are a few examples of why bookkeeping is important to your business.

Keep track of your financial transactions. 

Keeping an accurate record of all of your financial transactions is essential to maintaining your business. How much did you earn on your last project? How much did you spend on office supplies the previous month?

It can be highly time-consuming to record all transactions. From purchasing business cards, business lunches, or documenting the latest check you deposited, transactions are a daily occurrence. Having detailed records will help you ensure that you don’t have any unexpected expenses and receive all of your payments on time. These records will also make tax preparation time much more manageable. Hiring a professional bookkeeper will save you time and give you the peace of mind to know that your information is in order. Additionally, professionals can help you identify places where you spend too much money, places you can save, and even opportunities to earn extra income.

Improve your cash flow

Your financial well-being has to do with so much more than the amount your company earns each quarter. Cash flow is one of the greatest struggles for small and medium-sized business owners. Bookkeeping can help you navigate this by paying close attention to what cash you have coming in and what cash you have going out. A bookkeeper will keep a schedule of these accounts and work with you to make sure you have enough money on hand for all expenses. This knowledge will also allow you to adjust a planned purchase or take action in other ways if needed. Make financial decisions with the confidence of knowing you will not default on a payment.

Protect Your Business in the case of an IRS audit 

When it comes time to file your taxes, you will already be in a good position if you’ve hired a bookkeeper. They will have kept track of your transactions and helped you prepare your filing. If you owe past due money, are receiving confusing correspondence from the IRS, or if your return is selected for an audit, a bookkeeper will be able to assist you before the IRS for the Franchise Tax Board. Bookkeepers specialize in Collection and Appeals representation and will protect your business during an audit. Bookkeepers specialize in Collection and Appeals representation and will protect your business during an audit.

Above are just a few reasons why bookkeeping is important to your business. Take the burden of all of the paperwork off of your plate and know that you are fiscally sound. Consider booking an appointment to learn about ways in which we might be able to help you and your business by calling 410.764.3731, emailing us at info@plcfo.com, or filling out a form on our website