Bookkeeping: Business Number Collection follows on from our last blog post on loving numbers.
Previously we talked about loving numbers and why they need love. Today, we want to talk to you why and how you collect those numbers, those ‘words’ to tell your business story.
Bookkeeping can be traced back thousands of years. In fact Accounting records dating back more than 7,000 years were found in Mesopotamia, and documents from ancient Mesopotamia show lists of expenditures, and goods received and traded. The development of accounting, along with that of money and numbers, may be related to the taxation and trading activities of temples:
Other early accounting records were also found in the ruins of ancient Babylon, Assyria and Sumeria, going back more than 7,000 years. The people of that time relied on primitive accounting methods to record the growth of crops and herds.
In the 21st century the way to keep records has advanced. The reasons for doing so remain the same.
Why Keep records
We take videos and pictures to capture moments that we will treasure for life. We do that so we never forget. Our brains are powerful, but we know we won’t be able to recall all of life’s events.
Likewise, the same thing applies in your business. Your business may process 100s of transactions daily. With all that going you can’t keep reliable mental notes.
You need to make a record of your business financial events. Business decisions should be based on more than instinct. Instinct is useful, evidence is stronger. In addition, you need to be aware of your profits or losses. Also, bookkeeping gives life to your financial and business activities.
Bookkeeping is critical when running any business. It scares some people, and it can be neglected. You need to keep a record of what you spend, and where your money is coming from. More importantly you need to know what you are spending, and where the money’s coming from.
- Firstly, it is a sign of good business thinking. The key is that you recognise its importance.
- Secondly, Cash and liquidity is what keeps your business going. You need monitor and maintain control of your cash.
- Thirdly, bookkeeping is the backbone of any management information system. You can use the records to generate critical financial information. For instance, profit margins and costs. Use it with sales information to calculate customer profitability.
- Fourthly, you’ll need those records when you want to illustrate your business word story with numbers.
- Fifthly, make sure you don’t fall foul of the tax authorities. For example, keep on top of your VAT/PAYE returns, personal and company tax returns.
Manual v Digital Bookkeeping
There are two basic choices for me.
You can either go manual, which to me is spreadsheets (electronic pen and paper) or tap into the Cloud.
I love using spreadsheets, they are here to stay and have a great future. They are low cost, and if all you want to do is keep simple records then fine. However, things are different if you want to cut down on the heavy lifting, make life easier, easily connect to your numbers and take your business seriously. Tapping into the cloud is the way to go for Bookkeeping: Business Number Collection
Book Keeping in The Cloud
The idea of a ‘cloud’ is that multiple computers are connected to multiple other computers. This principle is applied to Cloud or Digital Accounting.
Cloud accounting does the power lifting of record keeping. Furthermore, it saves time, money, and gets businesses to connect to. Hence letting you take charge of your financial numbers.
There are lots of good cloud Accounting platforms out there, and mixed use among our clients. On balance, our choice is Xero, and the benefits below link to that choice.
If you want your business to work smarter and faster, switching to Cloud Accounting is a wise investment. Working in the cloud gives you a better overview of your finances. Likewise, it increases control with up-to-date financial information.
- Better real-time overview of your current financial position
- Access for multiple users
- Automatic updates
- Everything runs online which cuts out the need for installation.
- Your work is saved and backed up all the time, ensuring you don’t lose anything
- Free updates which are available for instant use
- Costs such as version upgrades, maintenance, system admin costs and within the subscription cost
Headline benefits from using Xero include:
- Better productivity and efficiency gains.
- No more tedious data entry
- Live financial information at your fingertips
- Xero mobile app for on-the-go
- Security of your financial information, from storage and access
- A range of third-party apps connecting to Xero
- Cut down the time looking for and querying transactions.
In conclusion, Cloud accounting greatly helps with Bookkeeping: Business Number Collection. Cloud Accounting is our recommendations, even for freelancers, and micro, acorn sized business.
The power and capability of Cloud Accounting can be used for any business, size, shape or form.
The power and capability of Cloud Accounting can be harnessed for any business. Xero can be tailored to suit your own business.
On the other hand , complete our contact form and we’ll get back to you. Our friendly team can help you with this, and more.