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Guide to Bookkeeping for new business owners Part 1

Posted 14 Aug 16

If you are a young business owner, it is likely that the topic of bookkeeping and your responsibilities and requirements have been on your mind almost constantly. As your business start taking shape, you will need to learn which accounting records are important and how to keep them organised and up-to-date.

Apart from being a legal requirement, keeping your understanding your bookkeeping and keeping track of it is a key of managing a successful business.

Your company’s accounting might seem confusing, especially in its first year of trading, however, with this guide we will help you understand what kind of documents you will need to send, to whom you will need to send them and how to ensure that they are managed properly.

Should you do your own small business bookkeeping?

There is no legal requirement of your company to hire a professional accountant to do your bookkeeping for you, so the decision is completely up to you. However, before you make one it is important that you consider both pros and cons of doing bookkeeping on your own and compare it to the advantages that come with hiring an accountant to take the burden off you.

The main advantage of doing your own bookkeeping is that you will learn a lot about your business and saving money, which you can then invest in its development. The other reason why people decide not to hire an accountant is an attempt to spend as little money as possible in the first stages of your company’s life.

However, both of the above arguments can be easily counterbalanced by the advantages that come with hiring a professional and experience accountant. An accountant will likely spend half an hour of what would require you to dedicate your whole day to. Time is of special value to business owners and you should dedicate as much of it on focusing on those areas of running your company that led you to start your own business in the first place: creating the high quality products for the market you wish to target and designing marketing strategy to best express your ideas and aims. Even if you spend one day a week on your bookkeeping, you are wasting the valuable time and energy you could use on aspects that interest you most.

Furthermore, your accountant will not make mistakes you are likely to make, thus saving you a lot of money which you might have otherwise spent on covering penalty fines from HMRC. If you hire an accountant experienced in managing small businesses, like Tawanda Accountants, you will also receive a professional advice on how you can take care of your finances better and improve your company’s cashflow. If you would like to find out how we can help you better your business, call us today at Tawanda Accountants.