Here’s what we’ll cover
The one thing that great business owners, successful business owners clearly understand, is that growing profitable businesses requires them to pay attention to the exciting stuff and to the mind-numbing stuff aka your business bookwork.
Business isn’t all fancy websites, exciting branding, engaging sales training, fun networking events or growing social media followings. Some stuff we love doing and some stuff we don’t love doing.
Today I’m talking about your business bookwork. I know, you don’t want to hear about bookkeeping, none of us do – myself included! I despise bookwork. I outsource most of my own bookwork because I know it’s the one thing that won’t get done if it’s left to me.
Here’s what I’m going to cover;
4 Reasons why you need to get your bookwork working for you.
5 things to look for including questions to ask when you’re considering outsourcing your bookwork and
1 thing you need to do with your bookwork after the end of the month.
Links and Resources
- Checkout the Simply Smarter Numbers website HERE
- Checkout the Podcast HERE
- Checkout the Instagram page HERE
Keep Listening!
Here’s the shownotes
I want to kick off today’s podcast with a fact. The one thing that great business owners, successful business owners clearly understand, is that growing profitable businesses requires them to pay attention to the exciting stuff and to the mind-numbing stuff.
Business isn’t all fancy websites, exciting branding, engaging sales training, fun networking events or growing social media followings. Some stuff we love doing and some stuff we don’t love doing.
And today I’m talking about bookwork – now don’t go switching this podcast off – I know, you don’t want to hear about bookkeeping, none of us do – myself included! I despise bookwork. I outsource most of my own bookwork because I know it’s the one thing that won’t get done if it’s left to me.
I’m going to keep this short, sharp and practical. You’re going to take what I have to say on board AND you’re going to save time AND save money when you do.
First, here’s why you need to listen to me on this topic. I’m an ex-accountant, I’m a business owner and in my past life as an accountant I’ve crossed paths with more bookkeepers, good and bad, than I care to mention. So I’m the perfect person to tell you what to do, what to look for, what questions to ask in order to make your Bookwork Work for you.
What do I mean by making your bookwork ‘work for you’? Bookkeeping is a function of every business – no matter your size. You can choose to consider it as a chore, a necessary evil OR you can look at it as a source of opportunity, even an early warning system there to let you know asap if somethings not right in your business. You’ve got to do bookwork anyway so I say let’s make the most of it, let’s find the opportunity in it and I’m going to tell you how.
Here’s what I’m going to cover.
4 Reasons why you need to get your bookwork working for you.
5 things to look for including questions to ask when you’re considering outsourcing your bookwork and
1 thing you need to do with your bookwork after the end of the month.
4 Reasons why you need to get your bookwork working for you.
1 // You can save yourself some serious dollars in accounting fees IF your accountant and your bookkeeper are on the same page.
You want your bookwork to feed seamlessly into your accountant’s systems. The less your accountant has to handle the bookwork, the cheaper for you! The less they need to edit, change, check… the cheaper for you!
Naturally, I can’t promise that your accountant will charge you less – BUT I can assure you, at the very least, they will spend more time minimizing your tax and less time fixing or checking your bookwork.
Either way, it’s a win for you.
2 // Incorrect or incomplete bookwork can cost you, big time, in tax.
Hopefully you’re taking your bookwork to your accountant for tax planning throughout the year.
The better quality bookwork you present to them for tax planning, the better quality advice you’ll receive.
What does that mean for you? Less tax at tax time and less surprises at tax time!
3// Rubbish In, Rubbish Out.
You want to make good business decisions or rubbish business decisions?
Give yourself a fighting chance!
Good bookwork means you’ve given yourself every opportunity to make the best business decisions, based on accurate information.
4// Early Warning System.
Don’t wait for the accountants to give you their assessment of how you are going. That information is WAY out of date – sometimes 10 months out of date! The accountants reports definitely have a place, but they aren’t the only reports to rely on.
What good is it to you to be told TODAY that 10 months ago you should have reviewed your pricing or your wages or your expenses or your debt!? You can save yourself thousands by knowing what reports to review, when to review them, what to look for and when to act.
But without up to date and accurate bookwork you lose the opportunity to make changes. There is no early warning.
What to do about it?
If you are the bookkeeper and you want to keep doing the bookwork, TALK to your accountant about how you can prepare things better to make their job easier.
If you want to get bookwork off your plate and make sure it’s done properly, consider outsourcing.
Want to take your bookwork out-of-house? I’ll tell you what to look for when outsourcing a bookkeeper.
Keeping your bookwork in-house? These 5 tips will help you sharpen your bookwork pencil as well.
5 Things to look for when outsourcing your bookwork
1 // Cloud Based
Work with someone who ONLY uses cloud based accounting packages. (ie Xero or QuickBooks Online).
If they are willing to work with anything other than cloud based software, it’s likely they are not embracing technology and not working as efficiently as they can. (Their efficiency is your money when it comes to bookkeeping).
2 // Open to talking with your advisors
Save yourself some big $$ in bookkeeping and accounting fees by having your bookkeeper and accountant on the same page.
If your accountant prefers to have the bookwork prepared a certain way to improve their efficiencies, be sure your bookkeeper is open to talking with them and preparing the books accordingly.
It will also avoid any unnecessary double handling, which again, costs you money.
3 // Timeliness
Your bookwork needs to be up-to-date. Real-time numbers are key to business success.
You need reliable information at your fingertips to make good business decisions.
4 // Confidence with apps, add-ons and plug-ins
Apps, add-ons and plugins are another way for you to save time and money.
Xero has Receipt Bank, QuickBooks Online has Expensify. There are so many apps that work with your cloud accounting packages and you need your bookkeeper to be across them AND keen to have you use them.
There are apps for timesheets, stock control, payroll, the list goes on!
My point is these apps are all designed to save you time AND your bookkeepers time so you and your bookkeeper need to:
1) know about them; and
2) embrace them
5 // Get a referral
Ask them for 3 references and be prepared to call at least 2 of those references.
When you do call the referee, ask them these questions;
1) Is your bookwork hands-free? How much of your time does your book-keeping take?
2) Does the bookkeeper talk to your advisors as required?
3) Do they prepare the books in a timely fashion?
4) Do they ever suggest you should use apps?
One thing to do once you’ve got your bookwork up to date at the end of each month.
Find Out What Your Profit Is So Far This Year
At the end of each month review your profit for the year to date. Ideally set it up so you can see the income and expenses for each month. Month by month profit and loss.
If you’re not sure how accurate your reports are the first time you print them then get advice from your accountant. Ask them if you are looking at the right reports.
Lookup this year’s profit in your bookkeeping system. (The best time to do this is at the end of a month after all your bookwork is up-to-date).
Compare it to the same time last year.
Is it more or less than last year? Consider why. Clearly plenty of you will be impacted by Coronavirus some negatively and some positively. Use the prior years figures as a bench mark, a guide to how this year’s issues – good or bad – how have you really been impacted financially? Find out, know where you stand now – well before you roll into 2021.
Once you know WHAT your profit is, you’re so much closer to being able to IMPACT your profit
In summary. Be prepared to outsource. Be prepared to pay for someone to set things up for you to make your bookkeeping easier for you in the future. Make your bookwork WORK for you.
