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8 golden rules for managing your accounts well

by Uneeb Khan
Managing accounts

Accounting does not always have a good press with entrepreneurs, it is sometimes seen as a daunting and time-consuming task that does not add much to the company. Think again! Taking an interest into accounts is essential for any entrepreneur.

When it comes to managing their accounts, entrepreneurs have several options: managing it themselves, subcontracting entirely to a physical or online accountancy firm, taking charge of part of the in-house accounting, and entrusting part to a chartered accountant and finally, they can hire an in-house accountant. 

Whatever the choice of the entrepreneur, he must ask himself the right questions. How to maximize the use of its accounts? How to organize? Which tools to use? Among the best practices for managing your accounts, we reveal  8 golden rules. 

1. Get trained in accounting 

Accounting allows you to have a comprehensive view of your finances, to anticipate cash flow requirements, to make your budget forecasts, and above all to comply with the accounting, fiscal, social and legal obligations incumbent on you.

What accounting obligations do you have? 

Your accounting obligations depend on your tax regime:

  • real normal tax regime,
  • real simplified tax regime, 
  • controlled declaration regime.

This tax regime itself depends on your turnover and your activity. The higher your turnover, the more important your accounting obligations. For example, if you are subject to the actual normal tax regime, you must keep commitment accounting, based on your receivables and debts, while cash accounting is based on your receipts collected and your expenses paid. 

Why is training essential? 

Training in accounting allows you to know and meet all of your accounting obligations. It saves you time in running your business and gives you a better understanding of your cash flow. 

By training in accounting, you gain visibility. Numerous resources are at your disposal to train you, online with MOOCs

or sites like easy-account or face-to-face with training offered by public or private organizations.  

2. Choose the accounting software that suits you

The choice of software to manage your accounting is paramount, it is not a question of choosing the “best” accounting software, but of choosing the one that corresponds to your business. Make your choice based on 2 criteria: 

Your business sector

There is specialized accounting software in certain fields of activity (catering, commerce, etc.). This software offers you additional modules. For example, for a restaurant, the accounting software will offer a module to manage stocks and purchases.

The size of your business

Depending on the size of your business, the type of software and the cost will have nothing to do with it. If you are a TPE, you must opt ​​for a simple software with the basic functionalities: the edition of quotes/invoices and VAT declaration. If you are an SME, you need more comprehensive software that integrates the entire accounting process. Finally, if you are a large company, the accounting software will turn into ERP ( Enterprise Resource Planning or integrated management software in French) which will allow you to manage your entire business and not just the accounting aspect. 

Take your time to make this choice, do not hesitate to compare, test, and inquire with your network. 

3. Be organized

You have to deal with your bookkeeping on a daily basis. Do not wait until the last moment to complete your monthly, quarterly, and annual declarations. Do not wait until the last moment to send the documents to your accountant if you are outsourcing your Bookkeeping Services in Melbourne. To do this, make a schedule of all the accounting tasks to be carried out during the year so as not to be caught off guard a few days before an important deadline. 

You must also conscientiously classify all of your accounting documents (quotes, invoices, expense reports, proof of transfer, payslips, etc.) to find them quickly if necessary and have good visibility of the accounting information. 

4. Monitor accounting developments

Accounting is subject to legal changes. It is important for all entrepreneurs to follow these changes to properly manage their accounts. First of all, it will allow you to comply with the law and the new accounting obligations, but it also allows you to be on the lookout for accounting and tax optimization opportunities such as new aid for entrepreneurs or tax exemptions. ‘taxes.   

To keep watch, you have different possibilities. Start by following the news, major legal developments are relayed by the media. You can also follow the specialized media of your sector of activity which will aggregate the set you need. Finally, you can also follow the media specializing in accounting or the blogs of accountants

If you have a chartered accountant, know that he has a duty to provide information and advice (source: Code of ethics for chartered accountants), that is to say, that if a legal change concerns your activity, it must inform you . Read also

5. Go for sincere and honest bookkeeping

This rule may be a laughing matter, but don’t be tempted. Don’t spend personal expenses on your business account. Do not try to evade VAT or resort to moonlighting either. 

On the one hand, you expose yourself to sanctions from the tax administration which can go as far as imprisonment and a fine in the most serious cases. These sanctions will endanger your activity and its sustainability. On the other hand, honest accounting will facilitate the work of your accountant who will not have to seek justification for a suspicious expenditure. Your accountant will therefore spend less time on your file which will be reflected in your fees, he will also be more available for consulting services. 

6. Automate your accounting

Take advantage of technological developments to save time on your accounting. The time of the notebook and the pencil to manage your accounts is over. You can manage many aspects of your online business by connecting them with your accounting software: 

  • Online expense report
  • online bank
  • Manage your payroll online
  • Online health insurance

The automation of your accounting allows you to gain reliability and eliminate time-consuming tasks where you bring little added value. The dematerialization of all of these elements allows you to easily store all of your documents and supporting documents online. Don’t wait any longer and save time now.

7. Make your accounting a management tool

The advantage of clean and rigorous accounting is that it gives you lots of interesting figures on the financial health of your business. Go further, no longer see your bookkeeping as an accounting obligation, but as an opportunity for your business. Your accounting can help you obtain crucial elements:

Your company’s KPIs

Turnover, profit, margin, EBITDA (gross operating surplus), personal expenses, and marketing expenses; this non-exhaustive list shows you the wealth of information that your accounts can give you. Your accounting should help you have a “scientific approach to your business”. 

Financial forecast

Your accounts aggregate all the information necessary to make a financial forecast. The latter is useful for your business, but also for your investors if you have them or your bank.

Cash requirements

Which expenditure items should be reduced? Do you have short-term or long-term cash flow needs? All of this information is in your accounts. Use what you have to master the lifeblood of any entrepreneur: their finances. 

8. Call in a chartered accountant

Know that having a chartered accountant is not mandatory. No law obliges companies to have one, regardless of their size. You can completely internalize your accounting. However, the mission of the chartered accountant goes beyond just keeping your accounts. He is a privileged partner who can be very useful in seeing your business grow peacefully. The contributions of a chartered accountant are numerous:

It saves you time

The accountant and accountants who make up his accountancy firm are specialists in the discipline. Outsourcing your accounting saves you precious time. As specialists, they will be more efficient in handling the accounts and will bring you peace of mind in the management of your business.

He supports you in the key moments of your activity

The chartered accountant has multidisciplinary skills, he is an important support during key periods of your activity: the creation of a company, takeover, liquidation, or takeover. Whether on the accounting, legal, social or fiscal level, the chartered accountant can advise you or direct you to a specialist.

It improves your credibility with your contacts

The accountant is the “guarantor” of your accounting. As such, it gives you credibility when you apply for financing from your bank or from investors. It is he who establishes the necessary legal elements: balance sheet and financial forecast. 

In conclusion, be rigorous, be curious about legal developments and take advantage of innovations to automate your accounting. Change your perspective on your accounting and use it to gain visibility and serenity in the management of your company .

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