Is Bookkeeping Important?
Good books are critical, they are that basis for all your reports & forecasts give you the information to make decisions, they need to be right for you to stay compliant with tax laws, pay tax on time, manage budgets, & help in allocating resources.
Good books are critical for:
1. Better Budgeting
They give you confidence, because you know how much money is coming in from customers & other sources. They help you track costs & understand where your business stands financially. The information in them is needed for you to create accurate budgets & plans to help your business to succeed.
2. Accurate Financial Reports
Good books mean the financial reports you generate are always accurate and give a better insight into your business’s financial performance. This helps you make more informed decisions about how to allocate resources, spot financial trends & where you can save money.
3. Tax Compliance and Savings
They ensure you comply with tax laws; accurate financial information avoids costly penalties from HMRC for CIS, VAT & PAYE errors & late returns. They save you money by enabling you to take advantage of deductions & tax benefits that specifically apply to your business.
4. Cash Flow Management
You need good books to manage your cash flow effectively, so your business has the money it needs to succeed. Accurate records of income & costs help you plan your cash flow needs, avoiding potential problems, like costly overdrafts & stop you worrying about paying wages or subbies.
5. Confidence
Good books give you peace of mind, you know exactly where your business stands financially & this gives you the confidence to make decisions to help your business grow & succeed.
6. Setting Targets and Goals
It is very hard to set specific goals when you have no idea what your numbers are, this stops you tracking financial performance, setting realistic targets & measuring progress along the way.
7. Organised Records
Unorganised records are a ticking time bomb. Keeping records organised & up to date means financial information is always there when you need it, so you can answer questions, identify trends & make good decisions.
Chaotic records will stop your business from reaching its potential, it is difficult to know where you are if you can’t rely on the numbers, they make it difficult to make decisions & taking advantage opportunities that come your way.
Final Thoughts
Good bookkeeping is an essential component of a successful business. They help you stay compliant, manage budgets, pay bills & make better decisions.
Do you have good up to date books? Remember, you can’t run a successful business without knowing your numbers.
