Importance of Bookkeeping
What is bookkeeping?
Bookkeeping is the process of recording all the financial transactions and events that occur in your business. Purchases, sales, receipts, and payments are all organized in chronological order and accurately recorded so that all the money that flows in and out of your business is accounted for. These records can be kept in designated books or in computer bookkeeping software.
Why is bookkeeping important?
Accurate bookkeeping is critical to the success of a business. It allows the business to see whether its earnings are enough to cover its expenses. It provides guidance on the financial decisions.
Proper bookkeeping is also important for investing and financing activities. If the business is looking for bank financing, the bank will require financial records that support a healthy business. This type of financial data is achieved through organized and accurate bookkeeping.
Proper record keeping will also keep the CRA away. Discrepancies in your records will end up in faulty tax returns, which will send the CRA knocking at your door for an audit. Bookkeeping also assists with daily business management. By recording day-to-day financial details you can keep track of data, such as which customers owe you money and how much.
What are my options?
The most common software out there are Intuit QuickBooks or Sage Simply Accounting. Small business owners can do their own bookkeeping or use an accounting firm. Contact our firm for your small business needs. We can help you implement and maintain an accounting system.
Intuit QuickBooks has several different options at different price points. Visit the online store for more information.
Sage Simply Accounting also has multiple different options. Vist the online store for more information.
Contact Cheema CPA Professional Corporation for all your bookkeeping needs. We have bookkeepers who specialize in many different industries and can help you become more efficient.