Whether your business picks up during the summer months or it tends to slow to an excruciating crawl, you should always make time for accounting. Sure, you don’t usually associate summertime with accounting, but it might be a good time to start. The summer is an excellent time to get your books in a row, and doing your due diligence with regards to your business accounting practices will make next year’s tax season a breeze to get through. Not to mention the fact that you’ll give your CPA far fewer headaches, if you happen to use the services of one. Yes, you have a few major decisions to make as a business owner, if you haven’t made them already, and this summer is the perfect time to get started.
Hire a CPA
The practice of business accounting becomes infinitely easier when you have the services of a qualified CPA on your payroll. Even if you have the worse organization skills on the planet, a good CPA will organize everything for you and charge you a minimal fee to do so.
If you have been doing your own accounting and handling your own taxes up this point, why not try something different his summer? Give yourself a break and hand the reins over to someone far more qualified. You will possibly save money and your business will become stronger when your business accounting is being managed by an actual accounting professional.
Separate Your Personal and Business Expenses
The first thing a CPA is going to tell you is to start separating your expenses, if you haven’t been doing so already. Many business owners, especially small business owners, use a single or a couple of credit or debit cards for every expense they come across. They need to pay an employee, so they use their line of credit from the bank. They need more equipment, so they use a credit card. Yet when they go out to eat on personal time or when they buy flowers for their spouses, many business owners use those very same accounts.
Keeping everything together like that makes tax time a chore, as you will have to manually sift through your expenses so that you can pinpoint the proper business deductions, thus allowing you to keep more of your hard earned money come tax time.
When you effectively separate your expenses, which is as simple as keeping multiple credit and/or debit cards in your wallet, tax season will become easier and your CPA will thank you. Or you might find yourself thanking yourself if you’re one of those stubborn entrepreneurs who prefers manage their own business accounting and taxes.
Analyze Cash Flow
If you don’t already, start using business accounting software or create a spreadsheet that will allow you to keep track of your expenses and all payments that come in.
If you’re not keeping track of your accounting and your business has been having cash flow problems, you’d never know it. That’s why it pays to analyze all incoming and outgoing revenues so that you can have a firm handle on your books.
For example, if there is money leaking from your business due to employee theft or certain accounting errors, only by thoroughly analyzing your numbers can you hope to pinpoint the leak and patch it up completely. A business can’t grow unless all of these types of problems are fixed, and business accounting software or a simple spreadsheet that you create yourself can make all the difference in the world, particularly if your goal is to grow your business to become far more successful.
Fix Problems and Seize Opportunities
You will be amazed at what you can figure out when you finally have your business accounting affairs in their proper order. You can discover where your business needs help, where it’s doing well, how to cut costs and how to bring more money in. Your CPA can provide you with this type of information in many cases, if you actually decide to hire one, but it might pay to go through and analyze your accounting practices all on your own.
This summer, take control of your business. Start ensuring that your accounting practices are up to date and constantly being analyzed and your business will start to grow. After all, this is your livelihood we are talking about. It’s your lifeblood, your bread and butter. Don’t leave it up to chance. Put these business accounting tips to good use and make the right decisions to force your business to grow big, even if you think that growth in the current market environment is nothing but an uphill battle or downright impossible.