The Importance of accurate bookkeeping in your business’s financial health

Accuracy is integral in ensuring your small business has the correct information available to you, so you can make the correct decisions for your business, like increasing marketing budgets, hiring new staff members, buying new assets and many more. If your books aren’t accurate, you may hire a staff member you don’t need, or you might over-commit to marketing and not have the capacity to service it, important reasons that can affect your reputation and bottom line.

Anyone can process bank lines, but processing them correctly and accurately like a professional bookkeeper can, can make or break a business. If a transaction is processed without a source document (tax invoice) or with the wrong GST categorisation, not only can your business be affected internally but you may also not comply with government legislation and open yourself up to fines.

How to improve your business’s finances:

  1. Document Management – Software can help ensure accuracy in processing bills, with software like Hubdoc using OCR technology (document reading), they are able to reduce time in adding bills to your accounting system, and it also removes the element of human errors. Although software can help, it isn’t a replacement for human review, software can still get things wrong.
  2. Regular Reconciliation Process – By regularly completing your bookwork, you are able to have a fresh recollection of what each transaction is, and where to find the source documents if needed.
  3. Training and Education – By getting regular training, you are able to keep up to date with the constantly changing accounting environment, keeping you up to date with changes in tax laws, financial regulation and Software updates.
  4. Regular Financial Review – By sitting down regularly and reviewing your numbers, not only will you be able to make more informed decisions, but you are also more likely to notice something out of place. Our Geelong Bookkeeping team recommends you review your numbers at least once a month to keep your eye on your financial pulse.
  5. Hire a professional – The number one way to ensure the likelihood of getting the most accurate financials is by employing a BAS Agent or a Professional Bookkeeper, like us. BAS Agents and Professional Bookkeepers not only know the correct allocations but can also run you through what the numbers mean.

Accurate bookkeeping is the cornerstone of any successful business, by implementing these strategies you will be able to make more informed business decisions, maintain compliance and improve your financial health.

If you ever need assistance in implementing these or want further help with bookkeeping or system processes for your small business, then partner with our local Geelong Bookkeepers at Mackenzie Group.