How to Choose the Right Software for Your Business

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In this day and age, there is software for everything. The only software that doesn’t exist, is a software to choose software. *Our legal team will be in touch if you steal this idea.

When running a business, you will be pressured into improving efficiencies and creating automated processes, which software can often provide. However, just as a good software selection can assist your business, poorly chosen software can have negative effects which will waste time and money. Here are a few key pointers we suggest addressing before you make your next software decision.

1. Plan for the Best Usage, Expect the Worst

Don’t be sold nirvana. You will rarely find a business that utilises a software to its maximum potential, and if they do, they’ll still have a laundry list of things they want to fix.

When looking at a new technology for your business, consider what would happen if you only achieved the lowest level of implementation. Will the software provide any value at this stage?

Prime example, the fabled CRM.

If you only use the CRM as a digital contact book, would it still be worthwhile?

This isn’t a tip to reject any software that doesn’t overcome this threshold, rather it’s an early indication on the effort and dedication required to make the chosen software have a positive impact on your business.

2. Take the Time to Quantify Expected Improvements

Many people would have come across an administrative ‘weapon’ throughout their career. Someone who completes standardised tasks, so quickly, so efficiently, you cannot help but watch in awe.

Now imagine you are replacing their tools and processes with a new software that still requires manual input.

Has the time to complete their work been reduced?

Have the reports generated from their work been automated?

What are the immediate benefits of this new software?

Once you dig deep and estimate immediate, as well as future impacts of a software, you might be shocked to find there aren’t any positive ones in the short term. Highlighting this is crucial, not only for planning and implementation, but also change management in your team. Promising a new software that improves workflow and efficiencies, only to deliver a clunky, equally manual software is a bitter pill to swallow and can stunt staff adoption. Extra tip: If your administrative tasks are truly standardised, consider a tool such as UiPath which can perform the same tasks as your administrative ‘weapon’.

3. Pricing Comparisons

Software pricing norms have evolved over time. Fixed terms and unlimited users have made way for flexible engagements that charge by the ‘seat’. Seats can be deceptive.

Our key tip here is short and simple, forecast more seats than you need when comparing prices.

There will almost always be ad hoc requests from senior leadership, new starters, or unaccounted staff to have a seat. So, instead of watching payments balloon, account for additional seats before any engagement and ensure it is still within your price range.

4. Plan for Larger Teams

When deciding on new software, you can often fall into the trap of only finding a software fit for your current team. Avoid this and make sure the software can scale to any size.

Ensuring the chosen technology has collaboration capabilities, access hierarchies and clear audit trails will help your business increase the number of users and teams without costly restructuring required later.

5. Assign Responsibility

Our final and arguably most crucial point is focused on ownership, responsibility, and accountability. When a decision is made to select a software and implement it within your business, you need someone to take ownership for this decision. Notice we say individual and not a team. As the modern-day herald of business Elon Musk discovered, when a business decision is made, individuals must be held to account for the decision, future roadmaps, and the related business activity. If left to a team, responsibility can be handballed, final decisions are often left ambiguous, and points of contact are left scattered.

Choosing the right software for your business can have extraordinary results and having experienced and implemented a range of back-office software to suit many needs, Visory’s team of experts is able to advise software solutions suitable for your business. Minimising the risk of choosing the wrong software, we guide you through selection, implementation, and continual improvements to make your business run seamlessly with as little effort as possible.

Can Bookkeepers Lodge Tax Returns?

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To many people, bookkeeper and accountant basically mean the same thing. They get mixed up on who should do what. But the two terms differ significantly in many areas, despite some overlaps here and there. 

To answer the above vital question, we have to look at the different roles each handles, their educational qualifications, and who to hire based on your business needs. 

And did you know that accountants and bookkeepers can be BAS agents? We’ll also dive into the roles of a BAS agent.

Fundamental Differences Between a Bookkeeper and Accountant

Bookkeepers

A bookkeeper ensures your books are up-to-date and complete. That way, you (the business owner), investors, accountants, or bankers won’t have difficulty gleaning valid and current financial details. 

Make no mistake. Tax preparation isn’t the only aspect of financial tasks. Maintaining current, accurate, and complete books can help you in many ways: 

  • Run your business operations seamlessly
  • Avoid bank overdraft charges
  • Secure funding
  • Boost your business growth 
  • Save money

According to a recent Xero survey, 54% of accountants revealed that their clients don’t keep current books. The result? The accountants have to charge them for extra hours to prepare tax returns. 

What are the Functions of a Bookkeeper?

Every company or organisation generates receipts, purchase invoices, and expense claims. The primary task of bookkeeping is to transform these items into an accurate and orderly record. The bookkeepers can employ a software system to process your business financial transactions. Some (not all) bookkeepers can also prepare tax returns, and run payroll. 

Here are some of a bookkeeper’s duties:

  • Process expense claims
  • Process purchase invoices
  • Issue sales invoices
  • Manage filing and documentation
  • Chase payments from clients
  • Reconcile bank accounts in Xero and other software
  • Post and report journal entries
  • Run payroll
  • Prepare sole trade accounts and self-assessment returns
  • Offer basic tax returns

Bookkeepers’ frequency of working

Your bookkeeper can take care of your books monthly, weekly, or fortnightly. It all depends on your business complexity and size and the level of comprehensiveness you desire. 

Bookkeepers’ education qualifications

Bookkeeping doesn’t have defined qualification requirements that are regulated such as financial planners. However, serious bookkeepers take up studies and join recognised bodies such as the International Association of Bookkeepers (IAB). Vast financial experience in banking and larger firms can often help indicate the expertise and ability of a bookkeeper.

Tax skills of bookkeepers

Some have basic tax skills while others don’t have any, so be sure to ask. Sole traders can hire qualified bookkeepers to prepare accounts, handle tax returns, and perform basic self-assessment returns and tax-related tasks.

Accountants

Accountants’ advice can go beyond preparing taxes. They may advise you on future tax plans and continuous business performance evaluations. For instance, they may give you ideas on boosting operation results and remaining compliant with financial regulations. Therefore, meeting with them at least once per year or quarter (to review your books) is recommended.

What are The Roles of an Accountant?

An accountant’s primary role is to take care of advanced compliance requirements like lodging tax returns and accounts and advise you on strategic business management. They also regularly plan tax strategies to prevent tax liabilities and advise you on managing cash flow. 

Here is a breakdown of their duties:

  • Prepare sole trade accounts and self-assessment returns
  • Prepare limited company accounts
  • Corporation tax returns
  • Calculate capital gains tax
  • Prepare complex self-assessment tax returns
  • Prepare management accounts
  • Prepare business plans and cash flow forecasts
  • Advice on business structure
  • Provide basic tax advice
  • Provide specialist tax advice

Accountants’ frequency of working

An accountant doesn’t work as frequently as a bookkeeper. For instance, they may work on annual accounts or quarterly statements. Your business may occasionally involve them in more specialist tasks such as working on cash flow forecasts and business plans. 

Accountant’s educational qualifications

In Australia, a person aspiring to be an accountant needs higher education qualifications such as:

  • Bachelor of Accounting, Commerce or Business
  • Masters of Professional Accounting
  • Certified Practicing Accountant (CPA) program
  • Chartered Accountant (CA ANZ)

To qualify as an accountant, one must sit for higher-level exams. 

Accountants’ Tax Knowledge

They need to have a vast knowledge of corporation tax, capital gains tax as well as state, federal, and international taxes. You must be sure they’re experienced and knowledgeable enough to handle a particularly complex tax issue. 

A BAS Agent

A Business Activity Statement (BAS) agent manages BAS on your behalf. The agent may be an accountant or bookkeeper with BAS Agent registration. 

The roles of a BAS Agent

BAS agents can offer advice on BAS, lodge your business BAS with the Australian Taxation Office (ATO), or represent you to ATO concerning:

  • All Goods and Service Tax (GST)
  • Payment of Fringe Benefits Tax (FBT)
  • Payroll aspects related to tax amount withholding
  • Income tax payment via PAYGI and more. 
  • Wine Equalisation Tax (WET)
  • Fuel tax

Additionally, they may:

  • Design and implement compliance systems that adhere to BAS and business requirements
  • Advise you on the legal implications of the BAS provisions and laws
  • Review your company operations and reports to ensure they adhere to the BAS provisions
  • Offer you the certainty that you’re on the right path 

Conclusion

A bookkeeper can offer some good fundamental tax guidance if you run a business that doesn’t require more complex tax preparation and strategies. They’re also not as costly as accountants. 

If your business is registered as a company, have an accountant work on your annual accounts and corporation tax returns. 

We hope each professional’s role is now clear, and you now know who to call for your specific needs. For professional bookkeeping services, consider Visory.

No single bookkeeper fits every company. So once you partner with Visory, we will assign you an expert bookkeeping team that understands your industry inside-out. Our team will dedicate their efforts to ensuring your books are up-to-date. 

Want more information about our services? Let our Success Manager analyse your specific business needs. Get a Callback!

10 Tips on Bookkeeping for Tradies

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Big corporations, may have in-house accountants to help them do their financial calculations. As a tradie, you might not have one. 

Being a tradie does not excuse you from having crisp financial records and a clear financial understanding. Instead of investing hours upon hours learning small business accounting, which probably drives you crazy, you can easily outsource your bookkeeping, accounting, and payroll. But that does not excuse you from being on top of your business’s financials.

10 Bookkeeping Tips for Tradies

Here are ten bookkeeping tips for tradies that can help you set the right system, outsource to the right person and assess whether it is being done correctly or not.

1. Use Job Numbers

Job numbers are a way to identify individual tasks or jobs in an organization or business where you handle multiple projects, jobs, or tasks of the same nature. These numbers help distinguish one job from another to avoid miscommunication and confusion. These numbers become even more necessary as the business keeps growing and increasing its clientele base.

Using job numbers improves your bookkeeping by keeping clean records. These records help you track the progress of projects but, most importantly, track which projects are paid and which are yet to be paid. Furthermore, with such trackable projects, it is easier to optimize your execution process.

2. Create a Positive Bookkeeping Process

Most tradies do not enjoy paperwork, hence the career choice away from a desk. Bookkeeping for tradies, therefore, can be a cumbersome task.

To ensure you get it right, create an easy-flowing bookkeeping system. You can easily automate the flow from the job acquisition, execution, submission, invoicing, and payment if you use job numbers. You can also streamline and automate much of your payroll and accounts payable.

You can also outsource your bookkeeping, to receive assistance from a professional and set up everything as it should be.

3. Outsource Your Invoicing and Accounts Payable & Receivable

Managing all accounts can take a lot of time if done manually. Investing in an outsourced solution not only ensures you follow best practices but guarantees you stop sinking hours of your time into a standardised process. Instead, you could be off finding new clients to grow your business.

4. Stay on Top of Your Tax Obligations

Every business has to pay taxes. Filling in tax forms requires you to go back to your business finances to make the correct reporting. Failing to report correctly when filling in tax forms can be a crime. Therefore you should stay on top of your tax obligations. 

Nevertheless, you can work with a tax accountant who can help you get your records in check when reporting. In addition, a tax accountant will help you claim tax deductions that your business can be eligible for.

5. Don’t Mix Personal and Business Expenses

One of the critical character traits that successful tradies have to have is discipline. Not only discipline at work but also financial discipline. To avoid the temptation of using business finances to offset personal expenditure, it is a best practice to keep the two separate. Have a different bank account for your business and a different account for your personal expenses. The demarcation helps uphold the financial discipline required.

6. Monitor Your Bank Account

Making money is difficult. Spending it, on the other hand, is intuitive. You might think you have money in the bank and set off on a spending spree. That will harm or even kill your business. Instead, you need to be at the top of every dollar that enters and leaves your bank account. 

7. Keep In Contact With Your Customers

When you serve a customer, that should not be the end of your interaction. It is cheaper to service a previously acquired customer than to go out and acquire a new one. Therefore, it is crucial that you have your customers’ contact details so that you can keep nurturing that relationship to generate repeat business.

You might also need their contact details to reach out for feedback and recommendations. Also, if you will be rolling out new products or services, it is easier to get your customers to try, vet, and even become some of the earlier customers.

8. Maintain Detailed Financial Reports and Statements

The lifeline of your business depends on these reports and statements. Different financial reports and statements tell you different things. Having the details will ensure that the insight you derive from either of them is reliable.

The four financial reports and statements you need to keep accurate to the decimal – literally – are a balance sheet, an income statement, a cash flow statement, and an annual report. 

9. Keep Detailed Receipts

Receipts are proof of purchase or transaction. Keeping your receipts updated and detailed is vital for a business to track expenditure and earnings and as proof documents when tax season comes. Detailed receipts make for accurate reporting.

When you have an automated system, keeping the receipts is easier. But it is also advisable to keep physical copies in case of technological mishaps or corruption.

10. Outsource Your Bookkeeping and Accounts

There are experts that are more than capable of taking your bookkeeping and accounts workload off your plate and helping you manage them remotely. It is a good idea to outsource your bookkeeping if you intend to grow your business and focus on your clients and work. If you are stuck doing administrative work, then your business stalls. Let the professionals handle that and get back to developing your craft.

Bookkeeping for tradies is a crucial part of the business that cannot be ignored or done shabbily. It requires top-notch attention. With the tips provided, you can pay attention to the bookkeeping areas that matter.

But what would give your business more value would be to outsource your bookkeeping tasks. When looking for dependable bookkeeping experts, look no further than Visory. We have an expert team that will work with you to streamline your bookkeeping, accounts payable & receivable, and payroll services. Get started with Visory today.

How Do Bookkeeping Services Help Small Businesses?

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Bookkeeping is a vital process that helps business owners track financial records accurately. You shouldn’t avoid it if you want to keep your business organised, prepared for tax, and budget appropriately. Many small business owners are multi-tasking masters who opt to do their own bookkeeping instead of outsourcing the services from professionals.

But think of a day when you don’t have to attend to any back-office work. You could focus more on running and growing your business. By depending on professionals with greater bookkeeping and accounting knowledge, you reap the benefits of their expertise. This post will reveal the key benefits of bookkeeping services for small businesses. But before then, let us look at what bookkeeping entails.

What is Bookkeeping?

In the business world, bookkeeping is the process of recording and organising financial transactions. It is an integral part of accounting, focusing on recording daily business transactions in the books of accounts. These include sales, purchases, taxes, loans, investments, payroll, operational expenses, etc.

Bookkeeping establishes the accounting groundwork. In other words, accounting focuses on analysing the data collected from bookkeeping. This process allows business owners to know their financial position, detect financial problems early and fix them before they grow into full-fledged disasters. How you do your bookmaking determines the accuracy of the overall accounting process. Thus, it is vital to hire a qualified bookmaker to do the job.

The Benefits of Bookkeeping Services for Small Business

The benefits of outsourcing bookkeeping services for your small business are unmatched. Besides helping you organise and analyse financial information, you can accurately conclude the financial health of your business. These are not the only reasons bookkeeping is essential for a small business. 

The Australian Taxation Office (ATO) expects all businesses to maintain specific records and utilise accounting practices to track income and expenditure. Without accurate bookkeeping, tracking and reporting appropriate information to the ATO can be difficult. Here is a detailed overview of how bookkeeping services help small businesses. 

Makes You Prepared for Tax Time

Every business has to lodge a tax return at the end of the tax year. Tax deadlines are very strict, and lodging can be time-consuming. With a bookkeeping process in place, your financial information will be ready on time. That way, you won’t need to scramble for receipts and invoices with the taxman breathing down your neck. 

Enhances Accurate Budgeting

Outsourcing a bookkeeping service makes it easier to budget for the business accurately. With proper organisation of your income and expenses, it’s straightforward to review your costs and financial resources. A budget defines the financial roadmap for your business, helping you plan for the future by creating a manageable budget. 

Comparing your budget and the actual financial data is a perfect way to detect cost reduction opportunities or potential cash flow issues. If your financial books are inaccurate, it’s hard to make accurate budgeting since it will all be guesswork. 

Promotes Better Decision Making

As a business person, you need to clearly understand your finances to plan your company’s future effectively. You may have to make significant decisions like opening a new location or hiring a new employee. To make such decisions with confidence, it’s critical to understand your company’s financial performance. 

Accurate bookkeeping with the help of a professional offers up-to-date information, helping you make informed decisions. If the reports say that your business is running out of capital, you can opt to take a loan to boost development. 

Maintains Organised Records

The stress of trying to find a crucial document at the last minute can lead to missed deadlines and possibly a few errors. One thing a business can’t afford to do is make mistakes, as it could lead to costly consequences. A bookkeeping service can help with that! It will keep your books updated throughout, and help you maintain organised records. That way, it will be easier to find any information you need in no time.

It helps you Focus on Other Business Operations

If you decide to do bookkeeping on your own, you will spend much of your time paying invoices, processing payroll, and tracking expenses. As a result, you will have insufficient time to attend to other operations. A bookkeeping service allows you to focus on what you do best. Having enough time to focus on operations enables you to grow your business effectively and give you ample time for research and development plans.

Lower Costs

Every business owner aims to reduce their overall costs of operations. One way of achieving this is minimising the salaries and wages of workers by employing only a few. An in-house bookkeeper requires a significant salary and benefits, but it’s possible to do without them. The cost of hiring a third-party bookkeeping service can be relatively lower, and you will have an assurance of excellent services. 

Helps to Avoid Conflict of Interest

It can be risky to entrust bookkeeping and accounting to one of the owners in partnership businesses. Misconduct accusations can potentially ruin the relationship even when a record-keeping error is unintentional. If something goes wrong, the other members might question the intentions of the person responsible. 

Hiring an independent bookkeeping service helps avoid these inconveniences while boosting confidence among the owners. They can have faith that every financial statement is true, accurate, and unbiased.

What to Look For in a Bookkeeping Service

A third-party bookkeeper is typically an individual with relevant experience in accounting services offered to a diverse range of businesses. When looking for a bookkeeper, choose one that is well-acquainted with your business type and preferably industry. Look for those that specialise in helping small businesses like yours. 

Their service should portray excellent skills and experience to determine profits, losses, turnover, and other financial factors. This will help you determine the financial health of your business with ease. 

Get the Best Bookkeeping Service for your Small Business with Visory

Visory is a reputable bookkeeping company that gives you access to accounting and finance services that scale with your business. Our team of experts has experience in different industries and is ready to hit the ground running anytime. You will receive strategic reporting and insight to drive growth. Our monthly subscription fee is affordable and worth the investment. Contact us now to book a meeting.

Guide to Lodging Taxes for Small Businesses

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If you’re a sole trader, partnership, or company in Australia, there are a few options for lodging your tax return. This guide explains the process and your options as a small business.

The Australian Taxation Office (ATO) administers and collects taxes in Australia, though state government and revenue offices do so in some cases. The financial year for tax purposes starts on 1 July and ends the following year on 30 June. Tax obligations vary according to the business type, number of employees, and the fringe benefits a business offers its employees. 

If you’re running a small business in Australia, it’s important to understand federal and state tax requirements that apply to your business. Here’s an overview of how to lodge taxes for different types of businesses:

How to Lodge Taxes as a Sole Trader

If you run your venture by yourself, you are a sole trader. As a sole trader, you and your business are considered a single entity, so you won’t have to lodge a separate tax return for your business. You’ll only need to file one individual tax return that will cover both your personal and business income. 

As a sole trader, you can lodge taxes in one of the following three ways:

1. With myTax

 You can lodge your individual tax return online via the ATO myTax portal. To do so, you need a myGov account linked to the ATO. If your myGov account is already linked, you can start your tax return with myTax. 

2. Through a registered tax agent

Tax agents are specialist accountants who have studied both tax and law, thus can do tax preparation and lodge tax returns. They are eligible to offer tax services to the public so long as they are registered with the Tax Practitioners Board and renew their license every three years. 

Note that registered tax agents operate on their own lodgement schedule. Nevertheless, you need to engage a registered tax agent before 31 October, which is the due date to lodge your tax return. If that date falls on a weekend, the due date to lodge your tax return is the next business after 31 October.   

3. Complete a paper tax return

With this option, you should start by downloading the Tax Return for Individuals Form. Alternatively, you can place an order for paper copies to be mailed to you by phoning the automated Publications Ordering Service.

How to Lodge as a Partnership

A partnership is a business structure involving two or more people who distribute profit or loss between themselves. Unlike sole traders, partnerships need to lodge a separate tax return, thus requiring a separate Australian Business Number (ABN) for their business. 

Partnerships can lodge taxes in one of the following three ways:

1. Using SBR-enabled software

Standard Business Reporting (SBR) is an initiative that enables businesses to submit information directly to government agencies via their accounting software. As such, you can prepare and lodge your taxes with ATO directly from your SBR-enabled software. 

2. With a registered tax agent

Like with sole traders, those in a partnership  can engage the services of a tax agent to lodge taxes for their small business. Most registered tax agents have a special lodgement program and can lodge tax returns for their clients after the usual 31 October deadline. If you opt for this option, you can engage a tax agent either face-to-face or online. 

3. Complete a paper tax return

You should download the Partnership Tax Return Form and complete it accordingly. Alternatively, you can order a paper copy of the Partnership Tax Return by phoning ATO’s Publications Distribution Service. After completing the paper copy of the Partnership Tax Return, you can lodge it by mail to:

Australian Taxation Office

GPO Box 9845

[Insert the name and postcode of your capital city]

If you lodge the partnership tax return yourself, you should ensure that you lodge before the due date, which is 31 October. If you choose to lodge with the help of a registered tax agent, you will be informed of when they will lodge your tax return. 

How to Lodge Your Taxes as a Company

As with other business entities, ATO requires small companies to lodge their company tax return for every financial year they trade. For the 2021/2022 financial year, small companies are subject to a small business tax rate of 25% on their taxable income. 

What are the Company Tax Return Lodgement Options?

To lodge the company tax return, you have three options, just like sole traders and partnerships. These options are:

  • Lodge the company tax return with myTax,
  • Hire a registered tax agent to lodge on your behalf,
  • Download or order the company tax return form, complete it, and mail it to the ATO.

What are the Due Dates for Your Company Tax Return?

While majority of company tax returns are due 28 February, company tax returns lodgement dates vary. For instance, if you lodge your company tax returns on your own, you are expected to lodge by 31 October each year. 

If a tax agent does the lodgement on your behalf, they will follow their lodgement schedule, which may be after 31 October. Nevertheless, you should engage a tax agent before 31 October. In case the lodgement of the company tax return generates a tax bill, you will have to pay the amount by 21 November in the same year. 

Conclusion 

As a business owner, you must know what your business earned first in order to calculate your taxable income. You must also know what items to include and what to exclude. Without a bookkeeping process in place, you may not have financial information ready for tax time. 

The tax lodging process can be made more efficient by hiring bookkeeping and financial services. This is where Visory comes in. 

We are a reliable provider of advanced bookkeeping and financial support for growing businesses. Our digitally enhanced services help to  streamline your back-office and provide efficiencies in both time saving and cash flow improvements.   Furthermore, our business reporting gives detailed insights to help you make the best decisions for your business.

Learn more about Visory’s Bookkeeping and Financial Services for Growing Businesses.

How to Clean Up Messy Financial Books [Bookkeeping Clean-Up Checklist]

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Bookkeeping is an important part of any small business. It helps you keep track of your finances, which is key to staying on top of your cash flow. It also prevents you from making costly errors down the road. That being said, it’s inevitable for things to get messy from time to time.

There are several reasons why your financial books might get messy. If you run a small business that requires more reporting, you will have messy financial books. As your business grows and requires more money, it’s easy to let your financial books fall to the wayside. 

Having messy financial books can be frustrating. It makes you feel that you’re missing something and will never figure out where your money is going. When faced with a messy financial books situation, you should look at your bookkeeping system. A bookkeeping clean-up checklist contains a list of tasks you need to complete to clean your messy financial books. 

Bookkeeping Cleanup Checklist

If you’re consistently making poor financial decisions, it could be a sign that you need to clean your financial books and make some major changes. A bookkeeping clean-up checklist serves as a roadmap, guiding you through the process of cleaning your books. Here are a few tips to help you clean up your accounting records. 

Identify the Problems in Your Books

To figure out where your money is going, you need to track your transactions. This is a good way to identify inefficiencies in your financial books. For example, if you consistently overpay employees, you could be losing money due to payroll taxes.

A detailed look at your financial books helps you identify the problems, such as a lack of details in your records. It also helps you identify any issues that may be causing your financial books to be messy. Some of the potential accounting mistakes include:

  • Miscoding transactions
  • Mixing personal and business accounts
  • Misplacing financial records
  • Forgetting important tax details

Separate Your Personal and Business Accounts

Separating your personal and business accounts helps you track your transactions separate from your business transactions. It prevents you from making financial decisions based on your emotions and forces you to take a step back and ask yourself if the purchase is really necessary.

Separating your personal and business accounts makes it easy to keep track of your expenses for tax purposes. Keep track of expenses on your business account, separating office expenditures from operational and inventory expenses. Keep all your receipts safe as they help your bookkeeper have a comprehensive collection of all business transactions, saving you time and stress.  

In addition, keeping your personal and business transactions separate improves your financial security. It prevents instances where you use your personal finances on your business, putting you on a financial gamble. 

Signing personal guarantees for leases and loans for your business is a good idea when your business is young and hasn’t established a strong credit rating. However, you should avoid personal guarantees and build strong credit to give lenders confidence that your business can pay the debts. 

Track Every Transaction

The first step in cleaning up your books is identifying where the problems are. Are you consistently overspending? Are you making impulsive purchases without having a plan for how you’ll pay for them? Are you buying on credit, which is only making things worse?

You should list every transaction that occurred in the past year. If you’re having trouble remembering, make a note of the due date for each transaction. Doing this helps keep track of your cash flow.

Reconcile Your Business Books

Another important step in cleaning up your books is reconciling your business books. The process involves matching your bank statements and other records with your financial books. Reconciling your books helps you identify where the errors are. 

Reconciling your books with your bank statements helps you identify and correct the errors in cash transactions that you might have missed in your books. In addition, it ensures whether or not you have done everything right by matching the bank records by analyzing the cash in your bank account. Reconciling your business books:

  • Prevents slow transaction
  • Prevents the risk of typographic errors which might occur during typing
  • Deals with ambiguities of the first stages of starting any business 

Go Paperless with Bookkeeping Software

Bookkeeping software can save you time and help you stay organized. It can also help you find mistakes and inconsistencies in your accounting data, which can help you make better business decisions. It’s also a good way to keep track of taxes, which can be complicated without the right software. In addition, the software can also help you manage your finances better, which can help you save money and invest better over the long term.

Standardize Your Processes and Reporting

Standardizing your financial processes and reporting catches missed risks and opportunities and increases cash flow. When done right, standardizing and reporting your bookkeeping processes helps you understand where your business stands financially. You can use this information to allocate resources more effectively and make informed decisions. 

In addition, standardizing and reporting your processes avoids the headache of trying to keep up with where you are in your recordkeeping, which can save you time and energy. 

Outsource Your Bookkeeping If You Need Help

If you are not sure how to do the bookkeeping yourself or need help with bookkeeping, you should consider outsourcing. Outsourcing your bookkeeping is simple and helps keep your financial books clean, reducing your tax burden.

A professional bookkeeper knows how to clean your financial books, eliminating all the mess you might have made when personally running your business. To get help with your bookkeeping services, read our guide to finding the best bookkeeping service.

Final Thoughts

Your bookkeeping is a crucial part of your business. It tells you where your money is coming from and where it is going. A good bookkeeping system will also help you avoid mistakes or regulatory issues, and can give you better financial insights to drive better decision making.

But while your bookkeeping is a key element of your business, it’s often the most neglected. Many small business owners only record their transactions when they happen, which means they don’t have a clear picture of where their money is coming from and going. 

Follow the above bookkeeping cleanup checklist to keep your financial books in order. If you need help, reach out to Visory and get started today.

How Virtual Bookkeepers Benefit Your Business

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If you’ve hired the services of a bookkeeper, you’ve likely come to appreciate the value they bring to your business. From staying on top of financial paperwork in time for the tax period, bookkeepers are now applying analytical and strategic skills to elevate businesses.

Bookkeepers are also moving away from working from an office you’ve allocated to them to virtually working with different types of clients from remote locations. Hiring a virtual bookkeeper is one of the best ways to allow your business to optimise its resources while ensuring you have control over your finances.

What Are Virtual Bookkeepers? 

Virtual bookkeepers help manage your bookkeeping needs online or remotely, usually via cloud-based software. They work on flexible schedules where they choose their hours and where to work.

Thanks to technology, a virtual bookkeeper can help you meet your KPIs, as would an on-site bookkeeper. They can use QuickBooks or Xero to do the actual bookkeeping. There is also Zoom for meetings and consultations with clients and Google Docs for managing files.

You can choose to work with a virtual bookkeeping service or a freelancer, as long as they meet your bookkeeping needs. However, a bookkeeping service is far more efficient as you’ll have a team of professionals who have access to valuable software and platforms to track and update you on your finances.

Why Use Virtual Bookkeepers? 

You may already have a glimpse of what it’s like to work with a virtual bookkeeper if you’ve ever had to exchange calls and emails with your accountant or bookkeeper about daily transactions or payroll. However, if you’re still not sold on the idea of opting for a virtual bookkeeper, here are 4 reasons to help you make an informed decision.

1. Save Time and Money 

A full-time on-site bookkeeper won’t save you as much time and money as a virtual bookkeeper. When hiring a permanent employee, you have to consider the salary, insurance, paid time off as well as equipment and working space. Outsourcing a bookkeeper would be less expensive, as you pay for just the services while they sort out how they can help you. 

You also don’t have to spend so much time hiring and training a virtual bookkeeper. They already have established processes and have readily workable solutions to handle your bookkeeping needs. Since they are not limited to a physical location, it’s easy to access and communicate with them through any platform about the pressing needs of your business. In the end, you can allocate more time and resources to other value-adding functions in your firm.

2. Minimise Your Tax Liability 

Most virtual bookkeepers use cloud-based software, which enables them to quickly update and organise your receipts, payments, and bank statements before the tax deadline. This way, you can reduce your tax liability since you can claim the business deductions you’re entitled to.

3. Minimise Errors in Your Books 

Virtual bookkeepers are usually focused on delivering real-time and accurate reporting to their clients. Through the use of accounting software, they can quickly retrieve your profit and loss statement to check for misreported expense items or missing income. Overall, due to automation, you will always have a quick turnaround with your transaction management and reconciliations, leading to error-free financial reporting.

4. Improve Your Financial Reports 

Well-prepared financial reports will give you a true picture of how your business is doing. A virtual bookkeeper will objectively and competently manage your books by consistently monitoring day-to-day transactions and reconciling accounts. This means you can prepare your payroll and tax filing on time as they work hand in hand with you and regularly communicate via email or phone with ease. If you want a deeper understanding of a financial item, a virtual bookkeeper can generate customised reports as they are in sync with your accounting systems.

How a Virtual Bookkeeper Can Help Your Business 

A virtual bookkeeper elevates their key role as the lifeline of your business by being much more flexible, cost-effective, and having a more sophisticated oversight over the running of your business.

More and more companies in Australia have been outsourcing functions such as customer service and IT at a rate of 0.7% annually between the period of 2016 and 2021. It’s safe to assume the reasoning behind this is achieving cost efficiency to gain leverage. When you outsource a virtual bookkeeper, you not only avoid the costs of maintaining a full-time employee, but also access top talent in the market. You only have to assess them for factors such as their industry experience, skills, and their professional attitude. The best virtual bookkeeper will help your business scale as they come in to find quick solutions that go with the times.

Most virtual bookkeepers can work with any business, regardless of size. They can be an invaluable and affordable resource for small and medium-sized businesses, which are vulnerable to cash flow issues. While the bookkeeper handles the time-consuming but important financial and administrative tasks, the owners can dedicate their attention to other critical business deliverables.

Another upside of virtual bookkeepers is how they largely integrate technology into their work. This aligns with an increasingly technologically savvy business world and the labour force. Virtual bookkeeping services, for instance, won’t lack the technological infrastructure, which can be a huge capital undertaking for a business to handle the accounting, communication, sharing, and management of work from a remote location.

Final Thoughts 

There’s no doubt a virtual bookkeeper will bring you better value for your money as they handle paperwork and taxes with the help of automation. And with more bookkeeping services rising and offering a variety of services, you have the chance to choose the right team according to your budget. What remains is to try to strike a balance in your working relationship, so you can both work in alignment as your business keeps evolving.

At Visory, we offer personalised bookkeeping services to our clients. We’ve invested in the best software to ensure you get your financial reports in a timely and accurate manner. Get started today to learn more about Visory’s bookkeeping services.

How Do Independent Bookkeeping Services Work?

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Bookkeeping as a service is the new way to develop and maintain your business’ financial processes and management, at a fraction of the cost. Gone are the days when businesses had to hire an in-house accountant or bookkeeper and incur ongoing expenses like training and upkeep.

Today, outsourcing all aspects of your bookkeeping services to an independent professional is the new norm. It’s more cost-efficient, reliable, and scalable, meaning you get more time and resources to focus on growing your business.

But how do independent bookkeeping services actually work? This article will explain it all to you!

What Do Independent Bookkeepers Do?

An independent bookkeeper is not part of any accounting firm; instead, they’re self-standing professionals who offer their services to small businesses and startups. As such, they have no affiliation with any other businesses, so they can keep their clients’ information confidential.

The main job of an independent bookkeeper is to prepare financial statements and reports for your business. These include balance sheets, income statements, cash flow statements, and other documents that detail your business’ financial performance over time. An independent bookkeeper can also prepare your statements and documents so you’re ready when it’s time to lodge your taxes.

An independent bookkeeper must have specific qualifications before taking on this responsibility. For example, the bookkeeper must possess good communication skills, strong math skills, and excellent organisational abilities. They must also have experience working with small businesses and understanding the nuances of running one.

Benefits of Outsourcing to an Independent Bookkeeper

There are many benefits to hiring independent bookkeepers. Here are just a few:

  • Save Money – Outsourcing your accounting functions means that you won’t have to spend thousands of dollars each year on payroll costs. Instead, you can focus your efforts on growing your business instead of worrying about paying employees.
  • Get Better Quality Service – When you hire an independent bookkeeper, you’ll be working directly with someone who has been trained in accounting and finance. Thus, you’ll receive better quality service than if you were to hire a traditional employee.
  • Gain Peace of Mind – An experienced bookkeeper knows what is required to produce accurate financial reports. They understand accounting procedures’ rules and regulations and will help keep your business compliant.
  • Increase Efficiency – By outsourcing your accounting functions, you’ll be able to save time and money and use the savings to grow your business.
  • Reduce Stress – You don’t have to worry about whether your books are being prepared correctly. A good bookkeeper can handle this vital aspect of your finances.
  • Improve Your Business’s Image – One of the ways people often measure business success is by how well their financial statements look. An independent bookkeeper will ensure that your books are prepared accurately and professionally.
  • Benefit from Expert Advice. Because an independent bookkeeper isn’t bound by any type of contract, they can provide valuable insight into areas of your business that you may not know anything about.

How Do Bookkeeping Services Work?

Bookkeepers work for a variety of clients. Some businesses hire them to handle their entire accounting needs, while others only use them for specific projects. Either way, there are four basic ways that bookkeeping services work:

1) Full Service – If you want to outsource your entire accounting function, consider using a full-service bookkeeper. Their job includes preparing financial reports for you, including profit and loss statements, balance sheets, cash flow statements, etc. They may also offer payroll processing, tax preparation, and business reporting services.

2) Partial Service – If you only need help with some of the more complicated aspects of your accounting, such as preparing quarterly tax returns or creating monthly budget projections, you should consider hiring a partial service provider.

3) Contract – If you just need occasional assistance with your accounting, you should consider contracting with an independent contractor. These individuals usually charge hourly rates based on the number of hours worked.

4) Project-Based – If you just need a bookkeeper to complete a few specific projects, such as preparing monthly sales reports, you should consider using a project-based bookkeeper. This type of bookkeeper works on a per-project basis. For example, they might prepare a report for you once every two months.

How Do Independent Bookkeeping Services Charge Clients?

As we hinted earlier, independent bookkeepers are usually more affordable than hiring someone in-house. Most bookkeepers charge clients either a flat fee or an hourly rate. Here are some examples of these fees:

  • Flat Fee – Flat fee pricing means that the cost of the service is determined at the beginning of the relationship. It does not change during the engagement.
  • Hourly Rate – Hourly rate pricing means that the client pays for each hour worked.

Here are some other factors that affect the price of bookkeeping services:

  • The size of the business – The larger the organization, the higher the costs associated with running it.
  • The complexity of the accounting task – More complex tasks require more extended periods to complete.
  • The number of people involved in the process – A large team requires more time and resources to manage.
  • The level of expertise required – Tasks requiring more advanced skills or expertise will typically cost more.

For more information about Visory’s pricing, visit our pricing page. 

Using Professional Bookkeeping Services

If you’re in the market for professional bookkeeping services, here are a few things you can expect from a reliable bookkeeper like Visory:

  • Regular Reporting – We can provide regular updates regarding your finances, so you always know what’s going on.
  • Account Reconciliation – When we receive your books, we’ll handle reconciling them against your bank statement, credit card statements, and any other source documents you send us.
  • Tax Preparation – We can assist with filing your taxes on time and accurately.
  • Budgeting & Forecasting – We can create budgets and forecasts, so you have a clear picture of where your business is headed.
  • Payroll Processing – We can handle all of your employee payments, including direct deposit and withholding.
  • Accounts Payable and Receivable – We assist in keeping track of outstanding invoices and accounts payable.

We’re happy to answer any questions you may have about how professional bookkeeping services work. Click here to get started with Visory!

10 Bookkeeping Tips for Startups

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When launching a new business, bookkeeping might not be the first thing that comes to mind. Your priority is probably finding clients and focusing on your business’ success. However, bookkeeping is foundational to the success and financial health of your startup. Having your books in order and detailed financial statements can help you make more informed decisions for your business.

So, where should you start? Read along for ten tips on bookkeeping for startups. 

Do Startups Need Bookkeepers?

Bookkeeping is essential to every business’ success. However, as a startup, you may have an additional need to maintain accurate financial records. Your investors will often request you to provide the records. Plus, your chances of qualifying for a business loan will increase when you offer precise and accurate financials to your lenders. 

Here is why you need to hire a bookkeeper:

Accurate and Reliable Numbers

Bookkeepers record and maintain accurate and reliable financial numbers. With these figures, it will be easier to make well-informed decisions about where to invest your money, how to acquire new clients, access financing, and grow your business. 

Monitor Cash Flow 

Bookkeepers have the expertise and experience to track revenue and costs and ensure that your startup doesn’t face any cash-flow problems. They can also discover ways of reducing your business expenses.

Tax Preparation 

Bookkeepers work alongside accountants to ensure that all your financial records are ready for tax season.

Professional advice  

It’s advisable to consider a second opinion before making major business decisions, especially for new business owners, your bookkeeping team comes in handy when you need professional advice. 

Save Time for Other Essential Duties

Tasks like financial monitoring and account reconciliation can consume a lot of hours that you can otherwise spend on growing a successful startup. Therefore, it would be best to let professionals handle these tasks.

 It’s also essential to maintain a healthy work-life balance. 

Top 10 Bookkeeping Tips for Startups

As a business founder, you must learn to incorporate bookkeeping into your startup. Early-stage financial reporting will save your business unnecessary expenses, set you up for tax benefits and ensure that you make informed investment decisions, among other benefits to your bottom line. Below are essential bookkeeping tips for startups:

1. Select an Accounting Method for Your Business

 There are two possible accounting methods; cash and accrual basis accounting. 

Accrual Basis Accounting

This method involves recording revenue earned before you receive payments for the services or goods sold and recording expenses incurred before you pay for them. 

For example, if you sign a contract with a new client, you will highlight the money earned in your accounting books regardless of whether you have received payments. 

While this method is a bit complex, it helps you track your business income and expenses more accurately, this is particularly beneficial when making scaling decisions and updating your investors. 

Cash Basis Accounting 

This simple method involves recording income when you receive the money and expenses when you make the actual payments. 

2. Stay on Top of Your Financial Records

What type of records do you need to keep? Everything. Follow up on all documents that show your business revenue, credits, deductions and expenses. These documents include invoices, receipts, bills, proof of payment, bank statements, and all other relevant records.  

3. Use a Bookkeeping Software 

Automating your bookkeeping process with software can be a lifesaver for startups. It eliminates manual calculations and spreadsheets and saves you time for other essential business tasks. 

Ensure that you choose software that works with your accounting method and suits all your business needs. Also, consider factors like security, storage and accessibility. 

4. Outsource Your Bookkeeping 

While accounting software may streamline the bookkeeping process and make things easier, it’s still necessary to work with a professional bookkeeper. 

Outsourcing offers various benefits, including saving time and ensuring that you maintain up to date and organised financial records.

Most bookkeeping service providers like Visory will integrate with your bookkeeping software so that all entries are added automatically.

5. Identify the Most Important Financial Metrics and Key Performance Indicators (KPIs)

Financial KPIs are metrics that you can use to measure your business profits, expenses and revenue, among other financial outcomes. With this accounting data, it will be easier to analyse the financial health of your business. They include net profit margin, gross profit, margin, current ratio, quick ratio, accounts receivables, inventory turnover, return on equity, earnings per share, price to earnings ratio and much more. 

Identify metrics and KPIs relevant to your startup and include them in your accounting books.  

6. Use a Payroll System That Works With Your Accounting Software

The main goal of using accounting software is to reduce the amount of work needed. A payroll system should offer similar benefits; save your time and let you focus on growing your business. Therefore, you should choose a payroll system that integrates with your accounting software for  streamlined payroll processing. 

7. Maintain Current and Accurate Cash Flow Statements

Tracking the flow of cash and cash equivalents into and out of your business is essential. Therefore, it would be best to keep accurate and updated cash flow statements to analyse how your business generates income, funds expenses and pays debts. 

The three major types of cash flows that you should include in your books include:

  • Cash flow from financing activities
  • Cash flow for investing activities 
  • Cash flow for operating activities 

8. Make Accepting Payments Easier With a Payment Collection System

Nothing will make your work easier and enhance business success more than establishing a payment collection system. This system will manage your accounts receivable billing and collect money from your customers.  

For an efficient process, first, establish payment methods like cheques, online payment methods, cash, credit, and debit cards, then set rules for accepting and handling the payments. 

Setting up a payment collection system can help your business maintain a healthy cash flow.

9. Minimise Discrepancies With Regular Bank Reconciliation

Bank account reconciliation is an integral part of bookkeeping. Ensure all your records balance; the amount of money you withdraw from your business account should equal the amount spent. 

Regular bank reconciliation is critical, especially for funded businesses. Your current and potential investors expect accurate accounting and financials. 

10. Establish an Expense Policy

As an early-stage business, you need to track and manage your expenses. Without a clear expense policy, your team members may spend money without considering factors like acceptable expenses, budget and expense limits. 

Establishing an expense policy for your startup is vital in giving guidelines on using business money appropriately. As a result, you will eliminate unnecessary spending and create a positive culture. 

Conclusion 

It’s tempting to let bookkeeping take a backseat when growing your new business. However, if you want to run a profitable business, you must keep your financial records on top of your priorities. Follow the bookkeeping tips for startups above to avoid tax and cash flow issues and increase your chances for growth. 

Looking for a bookkeeping service provider? Learn more about Visory‘s bookkeeping services for growing businesses.

How Bookkeeping and Accounting Services Help Small Businesses

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All businesses, including startups and small-scale businesses, require a bookkeeper and an accountant. Besides managing your business’s day-to-day finances, these professionals help you track cash flow and improve your businesses’ financial health. Read along for more information on bookkeeping and accounting services for small businesses. 

What Can Bookkeepers and Accountants Do for a Small Business? 

What are bookkeepers’ duties? What do accountants do? Like most small business owners, you probably find it tricky to differentiate between accounting and bookkeeping. Yet you need to allocate your limited resources and assign duties wisely.

While both bookkeepers and accountants track and manage your finances to streamline your tax reporting process, there are still some significant differences between the two. 

Typically, bookkeepers are responsible for your business’ day-to-day record keeping. This can include recording transactions, maintaining a balance sheet, processing payroll, generating invoices, and merging accounts.

On the other hand, accountants analyse and process the data the bookkeepers put together. Accountants can use this data to create more complex financial reports or lodge the business’ taxes.

An accountant and bookkeeper can work side by side for a streamlined accounting process. For instance, when the bookkeeper records your financial details, the accountant counter checks the data and eliminates mistakes. Simply put, having both professionals ensures that your business remains compliant with tax requirements, offers a reliable cross-checking system, and strengthens your company‘s financial picture. 

How to Choose the Best Bookkeeping Service

Bookkeeping services are an integral part of every business. Bookkeepers can either break or make your organisation. Choosing the right professionals for this crucial role is vital. 

So, what should you consider when looking to hire the best bookkeeping service? 

Which Accounting Method Does Your Business Use? 

There are numerous bookkeepers within Australia. However, not all of them have the expertise and experience to handle your business’s financial needs. In this case, when looking for a service, you need to consider your business’s unique bookkeeping needs, including the accounting method that you use. 

Does the Bookkeeping Service Work With Your Accounting Software?

When blended with bookkeeping expertise and experience, technology helps to generate better financial insights. You need to evaluate the technology expertise of the bookkeeping firm. 

If your business already uses specific accounting software, confirm that the bookkeepers have relevant experience in the same software. 

Does the Bookkeeping Service Have Experience in Your Industry?

Hiring bookkeeping services involves bringing the right team to the table. In addition to expertise, the bookkeepers should have experience in your specific industry. Remember, bookkeeping, and accounting mistakes can cost your business big time. Don’t try to cut corners when choosing bookkeeping services for your company. 

Why Is Bookkeeping Important for Your Small Businesses?

Bookkeeping can be the difference between a business’ financial health and bankruptcy. Every small business needs this service to maintain accurate financial records. Generally, bookkeeping allows businesses to organise, keep, and analyse financial data to determine their financial health. 

By now, you understand that basic accounting and bookkeeping for small businesses is key in managing finances. Check out reasons why you should invest in bookkeeping services. 

You’ll Be More Prepared to Lodge Your Taxes

Business tax filing can be time-consuming, challenging, and stressful for business owners, particularly those without an accounting background. Fortunately, bookkeepers prepare all necessary documents and keep accurate records throughout the financial year. 

Without proper bookkeeping, it can be impossible to file an accurate tax return, meaning you might overpay the government, which could cause financial problems in your business. On the other hand, underpays can result in heavy fines and payments with high interests.

Besides filling your tax returns, the tax laws require you to keep accurate business records that the Australian Tax Office (ATO) can use in the event of an audit. However, only a tiny percentage of small businesses are audited. 

Appropriate bookkeeping offers relevant justification if the ATO wishes to look at your business financial records. You can answer all questions regarding profits, costs, losses, tax returns and tax deductions. 

Save Time to Focus on Your Business

Every choice a business owner makes has an opportunity cost that can either be the opportunities you won’t take advantage of or duties that you won’t handle. Meaning before settling for DIY bookkeeping, you should consider the cost of spending a percentage of your time on financial books. Remember, “time is money.”

Every minute you spend creating ledgers, preparing invoices, reconciling your accounts and other bookkeepers’ duties, you will be missing out on a chance to focus on other essential aspects of your business. 

While bookkeeping is an integral part of running a successful business, it might not bring in new clients, improve your products, or directly boost business growth. 

Luckily, you can hire a bookkeeper to manage your books, while you direct your time and efforts to growing and expanding your business. 

Bookkeepers Can Identify Opportunities for Minimising Expenses

Tracking your business expenses and earnings is critical. Bookkeepers and accountants can quickly examine your costs and adjust your budget when necessary. 

But how? They identify the services and products that boost your profits and pick out unnecessary investments for your business. For instance, some forms of marketing like newspaper advertising were previously a crucial part of small business marketing strategy- however, in today’s business environment, the investment might not be worthwhile. Therefore, you can lower your marketing budget and direct the finances to other areas. 

Bookkeepers can help you analyse how things unfolded during your current year and make informed decisions when drawing up your next year’s budget.

Keep All of Your Financial Records Organised

Like most business owners, you are a pro in your profession, but you probably don’t know much about bookkeeping. While you might be financially savvy with some knowledge of QuickBooks and Excel, your level of expertise is incomparable to a professional bookkeeper’s knowledge.

Bookkeepers know and constantly learn new ways and processes for maintaining organised financial records. In addition, you may have a lot of duties that require your attention. With so much to handle, it’s easy to ignore some details here and there when managing your records. Unfortunately, in bookkeeping, a minor mistake can be costly. 

Bookkeeping and accounting services ensure that you keep accurate and organised financial books and eliminate the likelihood of mistakes. 

Conclusion

You might argue that an in-house bookkeeper can offer all the benefits discussed above. However, having a full-time in-house bookkeeper or accountant could cost you more than hiring a third-party service. 

Bookkeeping firms can charge fixed prices for a combination of services or a specific service; others offer monthly subscriptions, while others charge by the hour. You can choose the price point that best suits your businesses’s needs and bookkeeping and accounting service budget. 

The importance of bookkeeping and accounting services for small businesses cannot be overstated. Learn about Visory’s Bookkeeping Services.