Tips to Keep Your Books Updated

Why Book keeping?
Without proper Business book keeping practices, your business is susceptible to cash flow issues and potential legal problems. Book keeping is one of the most important of your business records since it includes all your business transactions. Book keeping enables the IRS to evaluate your business operations and helps manage your business better.

Here is a Guide to Understanding the Basics of Book Keeping:

1. Maintaining Employee Records
Employers are responsible for maintaining records on withholding, employer matching, unemployment, worker’s compensation and employee forms such as the W-4 (Withholding Allowance Certification) and the I-9 (Employment Eligibility Verification).

2. Tracking Revenues and Expenses
Revenue and Expense records can be maintained through a journal or a ledger. Journal is a popular method that details receipts and expenses. Ledger is a method that records transactions as credits and debits. Recording revenues and expenses helps track how much and on where money is being spent, and how much money is coming in.

3. Recording Cash Expenditures
To estimate your expenses as accurately as possible, it is important to record the cash your business spends.

4. Recording Inventory
Maintain records of all inventory, dates purchased, stock numbers, purchase prices, dates sold, and sale prices. Try to keep inventory holdings to a minimum based on business trends.

5. Accounts Receivable and Payable
Maintain all records of invoice dates, numbers, amounts, terms, dates and amounts paid or due, balances, and client information.

Tip: Consult a professional to understand the most efficient way that works for you to keep your books. Also, find out how other property management professionals keep their books.

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