5 tips on how to turn your accounts from your worst enemy into your best friend
This weeks guest blogger is Debra Fraser, from Back of House.
You can find more from Deb here.
Your Accounts. They are your worst enemy. They are always sitting there stalking you. Thinking about them fills you with fear, dread or panic. What if you could turn that around and they became your best friend in business. It is actually quite easy. Follow these 5 tips and you will be best friends with your accounts in no time.
1. Do your accounts every day.
Best friends catch up regularly. Spending 15 mins everyday while you are having coffee is enjoyable compared to dreading dealing with 5 hours of accounts. Of course you probably have a backlog right at this moment! Here is your plan of attack. Dedicate 1 hour every day until you are up to date or seek out a professional bookkeeper who can get it done quickly
2. Have the right accounting software.
Best friends are always discussing where to get the best coffee, food, clothes and lots more.
The same applies to accounting software. If you struggle with your accounting software it may not be the best choice for you. If you travel a lot a desktop solution is hell on earth as you can’t access it when you are way. Change to a cloud software. Do you dislike your cloud software? Investigate using another one. The right accounting software and add ons means catching up with your accounts is fun and enjoyable. Just like catching up with your friends
3. Learn how to enter transactions correctly
Remember when you got your car licence? How exciting it was to get in your new car with your best friend and confidently drive anywhere you wanted to. Heaven! Unlike a car you can get accounting software and not get a licence to drive it. You can lurch around for hours entering transactions only to be told by the accountant that there are lots of errors. Investing 1 to 2 hours on training to enter transactions correctly will save you a lot of time and money later on
4. Learn the meaning of financial terms
Financial terms are just like a foreign language. Before traveling to a foreign country that speaks a different language it pays to learn to speak some basics. It’s hard to make friends and enjoy conversations without it! The same applies with your accounts. You can only get excited about ROI, Equity finance, profit margins, Profit and Loss reports if you know what they mean. Otherwise your best friend is just talking blah blah blah and more blah.
5. Analyse what your accounts are telling you.
Friends love sharing information with each other. Your accounts love to as well. A monthly review can reveal lots of things you want to know. Check out the subscription accounts. Are you paying for anything you no longer use. Looking at your insurance account could show you haven’t changed insurance companies in 3 years. Do a price comparison. It’s amazing how much you can save by switching insurance companies. Do you have one income account called “Sales” but have multiple income streams? Create a separate income account for each so you can see at a glance each month the revenue generated by each one.