3 Useful Accounting Tips that will Make Accounting a Breeze for You
Usually when it comes to accounting, any business owner feels daunted and anxious. However, accounting need not be a nightmare if planned well. Just keeping your records accurate and taking some other precautions can make your job easy.
Following are some activities recommended by professional accountants at Xero accounting firm Singapore that are the “best accounting practices” that you can follow throughout every fiscal year to make the process smooth for you.
1. Keep Your Records Accurate
Most of the daily accounting of your business can be tackled and tracked through your online banking services, but the most important thing about your financial records is to keep everything in one place so you need not fumble to meet a request.
Simple credits and debits of your account can be tracked by online banking. However, when it’s about stating accurately how things were earned or spent, it’s an absolute must to maintain separate bookkeeping records. These records should track things like what things were bought using credit card, how cash was spent, if reimbursements were made to the staff etc.
Consider investing in simple accounting software, which can track money for you in and out every day. Everything tracked will only make things simple for your accountant down the road.
2. Categorise and File Receipts
Maintaining an accurate count and filing all receipts may appear tedious, but it can save numerous troubles in the future. It’s a worthy goal to ensure you keep all receipts associated to your business; but real receipt accounting is actually well beyond only retaining them.
You get receipts of all sizes and shapes and their ink fades over time. Scan or photocopy receipts to a regular letter-sized page and then collate them by date corresponding to your detailed financial records.
In addition, it will actually help categorise the expense (and eventual tax deduction) if you underline dates and make notes about the purpose of the expense on the copy of the receipt itself.
3. Count Applicable Taxes on Time
Taxes should be counted right at the time of sale or when payroll is formed. Similar to receipts, the longer you take from a transaction to proper accounting, the more will be a room for error.
You should count (or apply) taxes as soon as a sale is made or upon payroll formation. This will make sure that:
- You are not entitled to pay one lump sum of tax at the end of the year.
- Penalties won’t be incurred for delayed tax payments.
With this, your accountant can keep as much profit as possible.
Follow these tips and your accounting job will become a breeze instead of a tedious task.