Startup tips: The Importance of Record Keeping


In those heady first days of starting up a new company your focus will probably be of the core products or services that your new business deals in, and though raising capital is likely to be high on your list of priorities, the more mundane aspects of business finance and bookkeeping can slip by the wayside.

In order to build a successful business getting your finances right from the beginning is important, in spite of the apparent lack of glamour involved, . The bad news is getting your hands on capital may only be half the battle, the good news is best-practice bookkeeping and accounting doesn’t have to be difficult to implement if you’re armed with the right information.  If you really don’t know where to start with accounting, consider seeking professional help!  Hire an accountant to keep track of your finances and perform the many accounting jobs and tasks that building a successful business requires. You can even work toward an associates in accounting to help you learn the fundamentals of bookkeeping.

Here are some fast facts on bookkeeping to get you started:

Fact #1- All businesses need to keep accurate records or they could face a fine of thousands of pounds from HMRC.

Fact #2- You should keep accurate records of takings and expenses, bank statements, invoices, receipts, PAYE and more- the exact records you need to keep will depend on the type and size of business that you run. Records will normally need to be stored for up to six years, so setting up an efficient system from the word go could save time later on.

Fact #3 Keeping track of incomings and outgoings can give you the benefit keeping tight control of your business finances and cash flow- clear books allow you to see exactly what goes where, what you’re owed and what you owe.

Fact #4 Keeping records can help you find funding for growth more easily, because they can help a prospective lender see that you have a financially viable proposition.

Fact #5 Keeping records can help ensure that you’re paying the right amount in necessary taxes, helping you avoid an unexpected bill or fines.

span>It’s important to reiterate that the rules on bookkeeping will vary depending on your business details, but no matter what the size of your company, even if you’re only a Sole Trader, you will need to engage in some level of bookkeeping.

So how do I keep my books in order?

You can use a specifically designed business accounts program, use basic spreadsheet tools, or keep records on paper if you prefer.

You can do it yourself, hire an  employee, or outsource your bookkeeping to an accountant- choosing the right option for you will depend on your specific needs and circumstances.

Whichever method you choose, keeping accurate and thorough records can help build a firm foundation for your start-up and save you time and money in the long run.
Author bio: This post was written by Lucia Harris who writes for Juniper Accountancy, a professional Bristol accounting firm. As chartered Bristol accountants we can provide your business with a complete end to end service to take care of all your accounting and tax needs.