Book-keeping and it effect on a business

[Mellorando]

Book-keeping aids the owner carry out proper business evaluation and monitor its progress. Without book keeping the entrepreneur can run risks of fund mismanagement and loss of business expansion opportunities. Business records prevent theft and ensure proper organization of the business. Poor bookkeeping can have negative effects on how one conducts their business. For instance, you may find yourself paying your debts late, leading to higher interest rates, fewer payment terms, loss of credit and interference with your credit score or reports. Bookkeeping provides all accurate information regarding your business, which allows you to make decisions for growth. Bookkeeping helps to present past financial performance of your company and helps to plan for the future. Bookkeeping is important in staying in control of your business finances.
Probably the most important reason behind sound record-keeping is that it allows you to learn and grow from your own business experiences. Keeping your records in check will help you understand the current situations of your business and also project future profit or losses.

Here are seven reasons why bookkeeping is important for your business:

1. Helps You Budget Accurately
Bookkeeping is vital to any business because it makes it so much easier to budget. With your income and expenses properly organised, it’s simple to review your financial resources and costs. A budget creates a financial roadmap for your business. With a budget in place, you can plan for future expenses for your business to help with growth. If you don’t keep accurate and up to date books, it’s a lot harder to get an accurate budget because it’s all mainly guesswork.

2. Keeps You Prepared for Tax
As annoying as it is, businesses have to file their taxes at the end of the tax year. With a bookkeeping process in place, you’ll have financial information ready for tax season and the taxman won’t be breathing down your neck. So, when HMRC demands a financial statement from your business for tax reasons, bookkeeping regularly means you’ll be able to predict the outcome more accurately is you have detailed balance sheets over time.

3. Maintains Organised Records
That last-minute stress of trying to find a crucial piece of business can lead to missed deadlines and some small errors creeping through. Businesses of any size can’t afford to make any mistakes and bookkeeping regularly can help with that.
By doing your books often, staying on top of them and not leaving it to the last second, you’ll be able to maintain organised records. Over time, it’ll make it much easier to find the bits of information you desperately need in no time.

4. Easier to See Business Targets
Every business wants to grow, but poor financial records can stop that from happening at the speed you want. With no accurate number or data to analyse, it’s not easy to set yourself any growth goals.
Again, it’s going to be because you’re guessing everything so you’ll be quite disappointed that you didn’t hit the targets you set out previously. By staying on top of your books and keeping regular financial records, you can map out your business goals more accurately and achieve growth.

5. Meeting Government Regulations
We all know that the government always comes out with a new initiative which is mainly to make things easier for them. Most recently, it’s the Making Tax Digital (MTD) initiative with which the government is expecting businesses to comply. It’s exactly what it says on the tin - businesses will have to start doing their taxes digitally through the use of applications and software. In this case, you’ll not only need to do your books but also use an app for it as well. In all honesty, if you utilise an easy-to-use app then the process is quite simple. Plus, it’ll stop you from facing any penalties and it means you don’t need to waste money on outsourcing your books.

6. Gives You Extra Peace of Mind
Unorganised books, HMRC giving you problems and those looming tax deadlines can all contribute to plenty of stress and panic. As a business owner, the last thing you want on top of your day-to-day tasks is bookkeeping issues weighing on your mind. When your books are complete and tidy, they won’t be keeping you up at night. You can rest easy knowing that your business’ financial information is ready to be reviewed without HMRC giving you any anxiety. Your mind will be at ease and you can focus on other areas of your business.

7. You Learn in the Process
It doesn’t matter if you’re a complete newbie or a bookkeeping veteran. Doing digital bookkeeping offers you plenty of chances to learn and fill in some knowledge gaps. It can be hands-on with an app, free workshops and tools from HMRC or even reading content online.
Bookkeeping can teach you a lot more than you think about your business’ finances. Everything you learn will be beneficial for helping you make smarter business decisions.

 

[Jasz]

Keeping your books up to date is the most important part of a published company. Book keeping is a Fundamental process of any trade and successful business. The book keeping results can stand as an evidence of the business transactions that have been carried out at any given point of time and track activities and transactions taking place over a particular period of time.

Book keeping effect on business is implemented by independent checker or accountant of a company. Book keeping system allow you to track your financial status, boost your business profit by increasing efficiency and discipline and offer a widely range of special services to satisfy your needs.

The bookkeeping system comprises of 12 modules. It helps small and medium firms to properly manage their financial matters and activities. The Book Keeping System is easy to use and scalable for accounting requirement of businesses at varied levels. It has been designed to help one respondent business the flexibility of implementing a manual based accounting for the first time.


Bookkeeping is the recording of financial transactions in a financial account, and the preparation of financial statements. Bookkeeping is done by bookkeepers or accountants, or it can be done completely by computer systems. It is a very important process for businesses and other organizations.

 

[Kingsley]

I wonder if any business organisation will really make any progress without proper book keeping and records. Bookkeeping is an integral aspect of business management, it gives us information and a good idea of the position of the business and tells us more about the strength and weakness of the business and it tells us more about where we need to put in more effort to achieve the overall objectives of the organization

 

[btaliat]

There is need for bookkeeping in businesses. This will always allow the business owner to know whether the business is making loss or profit. This is not the only reason why there should be bookkeeping, there is need for bookkeeping when a business is considering taking a loan . Banks will love to see whether a company is making a profit or not before they can give out loan for the. Also, there is need for it in determining the tax that s company will be paying.

 

[Caramelle]

Bookkeeping is one of the administrative activities that businesses have to do regularly. Our tax authorities require company books to be updated on a daily basis. Sales, collections, and disbursements are supposed to be recorded daily and posted on a monthly basis to the general ledger. Books also need to be updated to enable proper and timely reporting of sales and taxes to the government. Accounting records are used as references for the computation of monthly, quarterly, and annual tax reporting and remittances.

Beyond tax requirements, businesses will benefit much from well-kept and updated records because they provide much-needed information for making timely and informed decisions. Accounting records will tell business owners the results of the business operations for a given period. Income statements provide information on the profitability of the business while statements of financial position provide information about the company's stability, solvency, and liquidity. Cash flow statements provide information about how the funds of the business are obtained and used. Businesses are required to submit these financial statements to regulatory agencies for monitoring purposes as well as computation of appropriate fees for licenses to operate. All of these reports are anchored on the company's bookkeeping systems and methods.

Bookkeeping should be handled by an employee who is skilled in the art of analyzing, recording, summarizing, and reporting transactions. It may also be outsourced to a third party who possesses expertise in the entire facets of bookkeeping and accounting.


​

 

[Didaagnew]

Yes! Its the most beneficial one.

 

[Chibson]

I wonder how a business will be able to thrive without bookkeeping. Bookkeeping is definitely one of the most important business practices and of course it has been working for ages. Bookkeeping helps your business to keep track record of all the financial inflow and outflow in the business. It permits the organisation of records and it also promotes transparency in the business environment. This is why every business must try as much as possible to employ a professional bookkeeper.

 

[Good-Guy]

The term "Bookkeeping" refers to a proper recording and analysis of financial affairs of a business. Bookkeeping is one of the fundamental things that are required by any business because it is not possible for any business to survive without it. Bookkeeping is a really broad term that involves financial accounting, investment analysis, financial research, investment records, maintaining records of financial flow in the company. Since it is so important for any business, it also plays a vital role in regards to financial auditing of the company as auditors rely heavily on yearly financial achievements of the company in the fiscal year. Accountants and administration also plays a crucial role in maintaining a proper bookkeeping channel and this could also help a company to deal with issues related to total expenses and revenues gained by the company.

Bookkeeping is done mostly by professional accountants in the company. Most of the time a chief accountant is also responsible when it comes to handling issues related to bookkeeping in the company and manages all the operations related to movement of finances in the company along with financial officials in the company. From huge business organizations to small businesses, all the kinds of businesses involve bookkeeping.