Outsourcing bookkeeping services is becoming a viable solution in the business world. It involves hiring external bookkeepers to manage your financial records and accounting tasks. This approach is cost-effective, ensures accuracy, and allows businesses to focus on their core operations.
In this article, we will discuss the importance of bookkeeping, outsourcing services, what to expect from it, and how to choose a provider. By the end of this article, you can decide whether to outsource bookkeeping services for your business. Let’s begin!
Let’s begin by discussing why outsourcing bookkeeping services is better than hiring in-house staff or a freelancer—some of the more common choices business owners like you have for bookkeeping and accounting.
Prime among the reasons you should partner with an agency is cost-efficiency. With an agency, all you need to worry about is paying the monthly fee. You can skip the added work and costs of training, and you do not have to worry about employee incentives and benefits. The agency handles all this.
You can also save time and effort on recruitment.Agencies have qualified bookkeepers and accountants, though you can check their credentials if you want to.
Two heads are better than one, they say. When partnered with an agency, there will be a dedicated team to manage your account. A bookkeeper will make sure to use the latest bookkeeping and accounting tools. From QuickBooks and Xero, tax software like Avalara and Taxomate, to document management software like Hubdoc—agencies have all these tools to ensure your books are up-to-date and organized.
If you aren’t trained in accounting, a dedicated accountant will create easy-to-understand reports. They also have the skill to explain the charts and statements in detail for you to understand your business finances. Most of all, they can give live insights and advice on how to run your finances. Nevertheless, you get the final say.
Last but not least, among the reasons outsourced bookkeepers and accountants are the way to go is that you get more time for other essential business responsibilities.
While you go about your day-to-day business operations, financial management and other bookkeeping and accounting must-dos are handled simultaneously by a dedicated bookkeeping and accounting team. As the business owner, all you have to do is make it a habit to check the accuracy of the details in the books; the rest can be delegated to your partner agency.
Outsourced bookkeeping services are ubiquitous, and you’ve probably already considered them for your business. To tip you over, here are the services you can expect when you partner with a third-party bookkeeping and accounting firm.
As a business owner, you have a lot on your plate. While it is manageable to do the books on your own in the beginning, your business transactions will grow as you scale your business. After signing up for a virtual bookkeeping service, you won’t have to worry about tracking your business financial transactions independently.
The agency will handle your books. Depending on the offer, the agency can track month-to-date income and expenses even if you sign up later in the year. From then on, all your business transactions will be monitored.
The best outsourced bookkeeping has the best accounting software to perform their tasks efficiently. Accounting firms invest in the following technologies to optimize their operations:
When looking for a firm to partner with, check the different software they use to manage your business finances.
Business planning and forecasting is another essential task covered when you partner with an agency. This data will help you create business plans to maintain the numbers you have or scale earnings to grow your venture further. They will make the most of the historical and recent data that you already have to foresee how your business will look in the future.
Keep in mind that these forecasts aren’t 100% accurate. They are subject to change, but they will still give you an objective view of your finances on a future date.
Of course, once your business grows, your team will also expand as you need expert minds and hands to help you with your day-to-day operations. Ensure that your employees are compensated correctly and are paid on time by delegating the task to an outsourced bookkeeping service.
Through their software and expertise, they can track the time rendered by employees, project costs, benefits, incentives, and taxes to come up with the computation of the final payment.
Your workers will automatically receive their salaries, too, as the software is connected to payroll apps or banks that can deposit money straight from your account to theirs.
Taxes are one of the most dreaded tasks of business owners. The reason behind this is the complicated tax rates that change from time to time, especially when it comes to sales taxes. When it comes to taxes, bookkeeping, and accounting, inaccuracy is a mortal sin. Not having the correct numbers defeats the purpose of the task and keeps business owners as you blinded to the actual financial status of your venture.
But with proper services, all the income and expenses of your business will be tracked, so computing your gross income on a tax rate basis will be easier. Agencies are also equipped with updated tax tools containing the latest sales tax rates, so the amount you’ll charge to customers will always be correct.
More and more business owners need ecommerce bookkeeping and accounting. You can also get this industry-specific assistance from a bookkeeping and accounting agency.
While you can expect the professionals who handle your account to be skilled in bookkeeping and accounting, they are also well-versed in how different ecommerce platforms—like Amazon, Shopify, Woocommerce, eBay, Etsy—work.
These ecommerce platforms already have a data center. But the agency will integrate the platform’s collected data into your main accounting system.
All the data in the bookkeeping and accounting software will be put into good use through the generation of these valuable financial reports:
Virtual bookkeepers will ensure the data you need for these reports are complete. At the same time, remote accountants will create reports and give you suggestions and assistance on decision-making.
Outsourcing bookkeeping services is a wise choice for businesses of all sizes. This cost-effective practice ensures accurate financial records and allows businesses to focus on their core activities.
We hope the common services offered by agencies mentioned above give you an idea of what you are investing in. In the end, opting for outsourced bookkeeping services instead of hiring in-house staff or freelancers will depend on what you need for your business.If you are wondering how to outsource bookkeeping services, call us here at Unloop. Our experts can handle your books. Talk to us today!
If you are a small business owner, you know that managing your finances is crucial to your operations.
Bookkeeping involves keeping track of all your financial transactions, such as sales, expenses, and asset acquisitions. Accurate bookkeeping is essential for financial stability and growth but can be time-consuming and complicated.
Outsourcing bookkeeping can be an excellent solution for small businesses to save time, reduce costs, and ensure accurate financial records. In this article, Unloop will explore why outsourcing bookkeeping can benefit small businesses and provide a guide on how to outsource bookkeeping.
You might be asking yourself why you must change your bookkeeping and accounting practices. These processes have been working for you for most of your time doing business and will likely continue to do so. Yet, there's no denying that there are plenty of benefits when you cross over the virtual bookkeeping and accounting fence. Here's what you can look forward to.
One of the essential benefits of outsourcing bookkeeping is efficiency. If your books are done entirely online using cloud-based software, it becomes more efficient. Things such as bank reconciliation, locating transaction errors, and preparing financial statements will speed up. This results in a more efficient accounting system.
As a small business owner, time is your most important investment, and it's limited. Outsourcing bookkeeping buys you time and lets you focus on your business activities that truly matter while leaving the financial recordkeeping to professionals. Doing so will let you spend time growing your business, developing new products and services, and expanding your customer base.
Outsourcing bookkeeping can reduce effort and retain resources. By hiring a professional bookkeeper, you eliminate the need to train an in-house employee, buy software and hardware, and maintain office space. Professional bookkeepers can also complete the work faster and more accurately, saving you valuable time and reducing the risk of errors.
Keeping accurate financial records is crucial for small businesses. That's because bookkeeping errors can lead to inaccurate financial statements, tax penalties, and even legal problems. Outsourcing bookkeeping ensures that your financial records are in excellent shape.
Professional bookkeepers are experts in their field and have the knowledge and experience to ensure compliance with accounting standards and regulations.
Outsourcing bookkeeping provides access to expert knowledge and skills. Professional bookkeepers stay up-to-date with the current changes in the accounting world and other important matters, such as tax laws and regulations, to ensure their practices are up to par with what's currently accepted.
Ecommerce accountants and bookkeepers also keep up with the latest updates in the industry so they can understand how these changes will affect their recordkeeping and accounting processes and ensure your business remains compliant and keeps accurate records.
Outsourcing your accounting, especially if you come from a traditional business, will expose you to a new and better way of doing things in your business's accounting wing. A lot of virtual bookkeeping and accounting professionals are adept at bookkeeping software and applications. If your financial records need to be digitized, they can help you transition.
If you're an ecommerce business owner who invested in accounting software, the transition from in-house to outsourcing your accounting will be easy due to the experts’ familiarity with the tools you use.
Tax season is one of the busiest times for entrepreneurs, and for most who already have a lot to juggle, tax preparation and filing can be too much. This causes penalties for missed tax payments.
Outsourcing makes business owners ready for the tax filing season. By passing the weight of the work to qualified bookkeepers and accountants, they can continue with their core business activities and take on a monitoring capacity when filing taxes.
With cloud-based accounting software run by experts, you can be sure that your bookkeeping and accounting system will be agile and ready for growth. Every abrupt demand shift will keep the system steady, allowing every growth strategy you formulate to be smooth because your adaptable accounting system is prepared to take on the challenges.
You can scale your business knowing that your bookkeeping and accounting team can handle the data load. As your revenue soars, you will continue to have accurate reports, seamless payment processes, and timely payments.
Now that you know why outsourcing bookkeeping can be beneficial, let's explore how to do it. Here are some tips you can apply.
Before you start looking for a bookkeeping service, you need to identify your needs. What specific services do you require? Do you need help with accounts payable, accounts receivable, payroll, or all of the above? Knowing these things will help you identify the services that can meet them.
Once you've identified your needs, you can start researching your options. Look for bookkeeping services that specialize in working with small ecommerce businesses. Read testimonials from other clients that can vouch for their experience. You may also ask for recommendations from your network of business owners and vendors, too.
Once you've narrowed your list of potential bookkeeping services, it's time to evaluate them. Schedule a consultation with each service to discuss your needs and get a sense of their qualifications, experience, and expertise.
To find the right service provider for your business, you must know what accounting services they offer. This way, you can get familiar with the options for your business. Here's what you should look for.
What makes outsourced bookkeeping valuable for ecommerce business owners is the remote feature. They can have their entire bookkeeping and accounting process done by a team of experts from another location.
Documents and receipts become electronic files at a snap of a camera lens, so all the necessary information to substantiate every transaction is converted online, making remote bookkeeping services a viable option.
Virtual bookkeeping services must have a roster of skilled accountants that can record transactions accurately, generate financial statements, and, on top of that, know the tools and software to make their work efficient.
Ecommerce businesses are prone to rapid growth because of their wider reach. As sales increase, so do expenses and the complexity of transactions. This poses a challenge to cash flow management, and if the ball drops on a growing ecommerce business, it can cause damage such as an unpaid obligation or, worse, insolvency.
It boils down to managing accounts payable. For your business to continue running smoothly, you have to control the frequency and amount of cash disbursement according to the business's obligations. So, the team of experts must know how to set up an excellent payment approval and processing system for you to take control of how you spend your business's cash.
Outsourced accounting and bookkeeping services must understand how to accurately record and manage financial data from different cost centers online. Doing this will be crucial in recording one of the most important accounts in ecommerce businesses—the Cost of Goods Sold (COGS).
COGS is an essential account in many ways. It can give you insight to your production or purchase efficiency, but it also serves as a data point to forecast potential revenue your business will have. Experts must know how to accurately calculate COGS and forecast revenue as important activities such as planning growth strategies or selling a company rely on it.
Every business has employees. Even if you own a one-person ecommerce business operation, it can grow big enough to employ many people, which the business has to pay.
Accuracy and promptness of payment are crucial to keep a growing business's gears running. Doing this requires a team of accountants and bookkeepers who are adept in payroll accounting and taxation.
Another thing that all earning entities are bound to pay is taxes. In the ecommerce realm, sellers face two tax challenges: sales tax and income tax. Both these obligations require different tax preparation and assistance.
When outsourcing accounting services, the experts must know how to support each type of tax. For sales taxes, they should offer assistance and guidance in setting up tax collection systems in your online store to deduct customer purchases automatically.
If it's income tax, they should be able to provide tax information and financial reports and collaborate with CPAs during the tax filing process, so you don't have to stress about filing on time.
Outsourcing to an accounting firm or agency should feel like your financial system is on autopilot. It should run like a machine on its own, needing only periodic checking and maintenance from you. That's the value Unloop offers with its bookkeeping and accounting services.Unloop has a team of experts who can do all the abovementioned services. They are more than just accountants and bookkeepers. They are ecommerce-specialized and act as your business partners invested in your growth. If you want to know more about how outsourcing can improve your business, book a call.
Managing finances can be challenging, especially if you're a small business owner. Keeping track of your bookkeeping can take precious time away from growing your business. Luckily, automated bookkeeping software can help streamline the process, making it easier to keep accurate records and make informed decisions.
There's bookkeeping software for every need, from cloud-based solutions that offer real-time updates to affordable options for small businesses. With the right tools, automating your bookkeeping can help you save time, reduce errors, and focus on what matters most—growing your business. In this article, we'll discuss the benefits of automated bookkeeping and explore some of the best software options available to help you get started. Let’s get into the details!
Are you planning to shift from manual bookkeeping to an automated system? Or are you just starting your business and looking into automation? Whether you’re a beginner or a seasoned bookkeeper, let us share the benefits of automated financial management to show you that you are making the right choice.
Prime among the benefits you will get when you automate your bookkeeping is the freedom from manual entry. To begin the automation process, look for optical character recognition software that allows you to capture receipts and documents and convert the details into text. You can integrate the tool into your leading accounting software for categorization.
Then, you can also integrate your bank into your bookkeeping system, so the deposits and withdrawals are recorded on the books immediately. If there are other channels where you get data, like ecommerce sites and other tools and websites, you can connect them to your bookkeeping software to automate data collection.
The biggest downside of not automating your bookkeeping system is the inaccuracy of manual data entry. No matter how seasoned a bookkeeper is, a minor mistake in clicking the keyboard or the calculator can cause miscalculations. The tiny mistake creates a domino effect of errors which stops you from seeing your actual finances.
When submitting an income tax report, all the details in it should be accurate, as when an audit is made and there are inaccuracies, you may face repercussions from the tax bureau. But with automated bookkeeping, even tax calculations are done automatically.
A typical scene for bookkeepers using Excel sheets is data corruption. One day the Excel sheets are functioning well; the next, they won’t open. The causes of this situation vary from data being too big that the Excel sheet crashes. Sometimes file transfer from one computer to a hard disk may be incomplete or incorrect, and the file transferred cannot be accessed.
With software, all your data will not be stored on a hard disk or a single computer but on the cloud. This space has layers of protection, ensuring your business financial data is corruption-safe. You can stop using corruption-prone Excel sheets when you use automated bookkeeping.
Hackers attack any website and database, and a financial record for your company is undoubtedly a great target. But because your books are saved on the cloud, you can relax as they are protected from hackers.
The cloud has a technology called data encryption which translates the information while it is moved from one storage to the cloud. As a result, even when data is being sent to the cloud, and hackers try to interfere, they won’t decipher the message. Only those with access to your account can access and understand the information.
Threat to the security of your financial data does not only come from outside but also from within. As a business owner, you should be wary about who you share your financial data with. As much as possible, keep the financial team small; these individuals should always keep financial information confidential. Create a confidentiality agreement and put it on paper, so those who will break the agreement can be held legally accountable.
Through automated bookkeeping software, you can limit access to only the most critical of people. Compared with traditional data that can be accessed by anyone who uses the computer where the data is saved, automated bookkeeping allows only those with login credentials to access financial data.
With traditional accounting, data can be accessed only on the devices where the document is saved. But when you use an automated bookkeeping system, you can access your books anytime as long as there is internet.
Many bookkeeping and accounting software are mobile device-compatible. When you download the app to your mobile device, you can log in and check your financial data wherever you are. The requirement to work in the office isn’t necessary anymore, and employees can work remotely. The best part is that when someone changes something on the books, the changes are updated automatically. Everybody who has access to the books can have the most updated numbers immediately.
Because all your financial data is in one place, you won’t have a hard time preparing for tax time. An automated bookkeeping software tracks and categorizes all your business income and expenses and even computes the taxes you need to pay yourself. As a result, you can file tax documents and pay on time.
Regarding sales taxes, you can use other apps and software to compute, track, and remit your sales taxes automatically. If there are instances when you must remit sales taxes, the tax software and your accounting system will show you how much exactly you need to remit.
Meanwhile, to understand the data in your books better, it is best to create reports from them. Some of the basic accounting reports you’ll want to see regularly are the following:
These reports will allow you to see the health of your finances. These financial statements are also helpful during investors' presentations and when applying for loans.
With the help of accounting software, you can generate these reports immediately. Many software have report templates that can quickly be filled out in just a few clicks. And if you need to customize these templates, many software programs allow you to do so.
If you are convinced that an automated bookkeeping system is just what you need for your business then you’ll need reliable bookkeeping and accounting software, and QuickBooks and Xero are the best choices. They are the primary tools that will transform your manual bookkeeping into an automated system.
The answer to your question, “How to automate bookkeeping?” could be answered by simply having Quickbooks. QuickBooks is one of the top choices of bookkeepers and accountants because of the following features:
All these features work together to provide business owners like you the convenience of tracking your income and expenses and transforming them into easy-to-understand reports.
QuickBooks is an excellent choice for business owners because you can access all these great features for affordable prices. For beginners, the QuickBooks Priority Circle that provides training is extremely helpful.
Xero is another option you can look into when picking bookkeeping and accounting software. This tool can assist you in your various financial management needs because of the following features it offers:
Some software don’t have a sales tax feature, but not Xero. You can also make better data-based decisions because of the tool’s data analytics capabilities.
The benefits of automating your bookkeeping are numerous and can significantly benefit your business. From saving time on manual data entry to reducing errors and accessing your financial data from anywhere, automated bookkeeping can help take the hassle out of managing your finances.
QuickBooks and Xero are two great options for reliable bookkeeping and accounting software, and we highly recommend seeking assistance from us here at Unloop to help you get started. We use both software and other tools to automate your business bookkeeping.
Don't let bookkeeping take up all your time; automate it today so you can focus on growing your business!
Your business may be considered small, but running it is not an easy task. It can be too much if you are responsible for sourcing your products, creating marketing strategies, and managing payroll. But with proper planning, you can ensure these tasks are manageable.
One perfect example of an overwhelming task for business owners is payroll. In this blog post, we'll talk about the most common errors in payroll processing and the benefits of getting a payroll management system for your business.
Business finances are some of the most complicated things to handle. There are several tasks involved in processing payroll, and there are also many ways business owners can make mistakes. Here are some common ones to look out for.
Errors in pay calculation are at the top of payroll mistakes. There are many ways pay can be miscalculated. There are payroll deductions, commissions, and tax payments payroll administrators need to consider. Furthermore, there are different rules when it comes to overtime pay and holiday pay.
Your employee's trust will take a hit when you continuously make mistakes with their wages. Payroll correction will help you fix the discrepancies, but tracking the mistakes can take a lot of time.
A company's payroll is often scheduled. Employees will anticipate getting paid after a given length of time. Imagine what they would feel if their pay is delayed a day or two. Giving your employees their pay on time builds trust and good rapport between them and the administration.
Failing to fulfill tax obligations that come with payroll can also cost your business penalties, late fines, and even legal issues. It should be a business owner's top priority to properly schedule the payroll and know the due for payroll taxes.
The busiest day for processing payroll is at the end of the year and the beginning of the new year. After a full year of paying employees and taxes, businesses should give the necessary tax forms to their employees. Most employees need the W-2 form that they will use to file for their annual income tax return.
Forgetting or not providing your employees with their needed tax forms is a big inconvenience on their part. It can also mean trouble for your business when your workforce complains about missing tax forms.
If there's a time business owners need to be thorough, it is when they do payroll records. The government recommends at least three years' worth of records regarding payroll operations. These records should include the employee data such as total hours worked, payment rates, and dates. For other legal purposes, some may require more years of records.
Complete records help you prepare for possible future audits and make the payroll process more efficient. Without the records, your business will be at risk of miscalculating payment and misidentifying your employees.
Most companies pay employees based on the time they log at work. Standard rates apply in the first 40 hours for a permanent employee. Depending on company’ rules, overtime rates may vary. Improper time tracking can lead to errors in payment. It can also be upsetting to the employees when they are underpaid because of lost time.
Here are some overtime situations that employers often overlook and fail to track.
For companies, a payroll system can handle, automate, and administer payroll. A payroll management software is an application designed to make the payroll management process convenient. Payroll management systems can eliminate the manual work for payroll administration, which translates to fewer errors in payroll.
If you are still trying to decide if you should invest in payroll solutions, here are some excellent reasons you should.
The last thing you want to happen with your payroll is a mistake in calculation. It can be stressful not just for the employee but also for you since tracking the error takes time. Underpaying your employees will lower their morale, and overpaying them will disrupt your business's cash flow.
An employee payroll management system can significantly decrease the risk of making errors from manual payroll processes. You can ensure that your employee receives the exact amount of their salary every pay period.
Collecting employee details is a necessity of payroll processes. Choose payroll management software with top-notch security to ensure that payroll data is only accessible to the human resources department and authorized personnel. The payroll employee database contains sensitive information such as addresses, birth dates, bank account numbers, Social Security numbers, and many more.
Time has significant value for every business. You can't afford to spend all your time on just one aspect of running your industry. A payroll software helps you skip manually entering long pay stubs, doing calculations, and individually depositing pay into your employee account.
By investing in the right software, you can automate payroll. Other payroll software can perform direct deposits. All you need to do is to authorize the transfer, and the system will deposit the money to your employees' bank accounts. You can go through your usual payroll routine hassle-free and more quickly.
Creating your employee's payslips is a grueling task. Imagine if you have 20 employees. How long would it take you to finish all the payslips and give it to them? The payslip is essential to employees since it contains the details of their pay, allowing them to see if they are paid right. It is also used for income tax filings.
A good payroll software can generate a payslip in an instant. This feature will be extremely helpful for growing companies. The more people you hire, the more payslips you need to generate, and this generation feature will make it easy for you.
Sometimes, work gets too busy, and business owners tend to forget their other tasks. A payroll solution is your friend during hectic workdays. You can customize your software to notify you of important reminders to ensure you meet necessary deadlines.
You can also schedule the payroll ahead of time for a more efficient process.
As business owners you have a lot on your plate, not just managing the payroll. Fortunately for you, Unloop offers a payroll service so your employees' wages are done for you. Here are some of the things we can do for your business.
Payroll is a tedious process. Focus on other aspects of your business and let professionals handle your payroll. Aside from payroll, Unloop can also do bookkeeping, taxes, accounts payable, and forecasting.
Book a call with us and talk to an expert for free!
Fulfillment by Amazon (FBA) has revolutionized the ecommerce industry by providing a means of fulfillment for small and medium-sized businesses selling on the platform. With the host of benefits that come with FBA—from packing products to storing them in Amazon fulfillment centers, product delivery, and 24/7 customer service—it’s no surprise that more entrepreneurs are taking advantage of this program.
However, managing bookkeeping for Amazon FBA can be a daunting task for FBA sellers as the program constantly evolves. Still, Amazon bookkeeping has several benefits that encourage you to dive into the complexity of the task. Let's take a look at the five benefits here.
Knowledge is power, even in Amazon bookkeeping. You can control your expenses only when you have visibility on them. You can pinpoint hefty expenses, keep your expenses low, aim for a higher income and profit, and save money. Among the many benefits of Amazon seller bookkeeping, a good thing is giving you the convenience of seeing all the following business costs and expenses.
On Amazon, you can sell as a product manufacturer or as a reseller. A manufacturer creates their products while resellers acquire ready-made products from manufacturers and resell them. Through good bookkeeping, you’ll know the cost of goods sold or the cost of acquiring your products. When this data is subtracted from the total revenue, you’ll get your company profit. You can then decide whether you can still lower this cost to earn more.
With Amazon bookkeeping, you can check the costs of packing your items before sending them to Amazon. If you are sending directly from the factory or from suppliers to fulfillment centers, your products should be packed according to the FBA guidelines. With this, you must prepare for additional packing charges from the manufacturer or supplier. By seeing this cost, you can decide whether it is less costly to pack yourself or delegate the task to manufacturers and suppliers.
After your items are packed, you need to register them for FBA through your Seller Central account. After that, Amazon determines which fulfillment centers you’ll send your products to. Whether your packages come from factories, suppliers, or your warehouse, a shipping expense will be added to the books. You can check how your choice of shipping company affects your finances and think about whether you need to find a cheaper or more efficient company based on your analysis.
When your products finally reach Amazon, you must keep track of the storage fees. Amazon bases storage fees on the weight and size of each product. These fees may rise from October to December—the peak season. Amazon provides you with these details on Seller Central, and you can integrate this data into your Amazon FBA bookkeeping software. As a result, you can check the rise and fall of storage fees in different months and create strategies to lower this cost.
On top of the storage fees, through bookkeeping for Amazon, you can track the fees for every item fulfilled by Amazon. The rate depends on the size, weight, and type of item you are selling. Many ecommerce sellers cut costs by utilizing box spaces to pack products inside the smallest package possible. When you track how much each item costs, you can create plans to pack wisely.
The fees for FBA do not end, and there are other fees you can still incur. When your package arrives at Amazon not following the packing guidelines, Amazon repackages them and charges you. Wrong and incomplete labels will add costs, too. Meanwhile, if you want to send your inventory to a single fulfillment center instead of several places, you must pay an additional inventory placement fee. Amazon can also handle gift wrapping for a certain fee. You can track all these when your bookkeeping for Amazon is in place.
As you scale your Amazon business and ship internationally, there are new costs you should consider. Taxes and customs duties are among these costs, and you also need to consider the currency rates of the places you send your products to. The right accounting software has multi-currency features to make conversion easier. Through the software, you can track international shipping expenses too.
One advantage of using FBA is the handling of returns and refunds. As Amazon handles it, your bookkeeper keeps track of the costs incurred. As an Amazon business owner, it is your role to check the numbers and, at the same time, pinpoint the root cause of why you're getting returns and refunds. Although they are normal, you still need to keep them to a minimum.
Bookkeeping for Amazon helps track your expenses, and you can count on it, too, for monitoring your sales and computing your income. Bookkeeping is also a tool for you to check your total assets and know the worth of your company. Some of the details you can check because of bookkeeping are the following.
When your bookkeeping is in place, you can integrate the data on Seller Central into your bookkeeping and accounting tool. With this, you can monitor your sales and use this detail to run different financial reports. You can determine the cause when sales are low and set game plans to get more buyers. When sales are high, you can determine its cause and duplicate the practice.
Amazon allows the fulfillment of orders from outside the platform through Multi-Channel Fulfillment (MCF). You can track your sales on Amazon and other sites with proper bookkeeping. If you sell in multiple ecommerce channels, bookkeeping will categorize the sales accordingly. With data, you can analyze whether MCF is suitable for your small business or if you need a different fulfillment method.
Net profit is the amount you get when you deduct all debts, expenses, and taxes from your gross profit. This value appears in many financial statements, which can be calculated correctly with proper bookkeeping. Investors and creditors check your net profit before investing or allowing you to borrow money. When a positive amount is reflected, it is called net profit, but a negative amount is called a net loss.
Inventory management is essential for your business as it is a part of your assets, and you’ll see details about it on Seller Central. Integrating this data into your bookkeeping and accounting software is best, so you only have one place to look for both finances and your inventory. When you see your inventory, you can replenish fast-moving stocks immediately. You can also keep an eye and work on slow ones.
Amazon has Marketplace Tax Collection to comply with the Marketplace Facilitator law that compels third-party sellers to collect and remit sales taxes on behalf of sellers. Although Amazon already has the accurate records for you, which makes tax time easier, it pays to monitor the data. Meanwhile, when all the transactions in your Amazon small business are monitored throughout the year, tax time and paying taxes will be more uncomplicated.
Make the most of the data from Amazon's default reports and different channels to see the financial state of your business through reports. The best accounting software generate the following reports in just a few clicks:
Bookkeeping and accounting tools have templates you can readily use, but they are also flexible if you want to generate customized reports.
There are plenty of accounting software options out there, like QuickBooks Online and Xero. These tools give you the choice for cash-basis or double-entry accounting, which you'll find helpful in tracking your finances and generating reports.
Investors want to put their money in stable businesses to get a high return on investment. You can use the reports you generate above for investor presentations. Let the numbers talk through your reports.
Meanwhile, to scale your Amazon store, there will be times when you need to apply for loans. Many creditors require seeing some of the reports mentioned above to ensure you can pay for your debts and interest.
Because you have bookkeeping in place, you do not have to worry about the two situations and other business presentations you need to make.
Amazon FBA bookkeeping is crucial for businesses to manage their finances effectively. Business owners can monitor their expenses, track their income, and stay tax compliant through bookkeeping. It also helps analyze reports and prepare for investor presentations, making it easier to scale the business or apply for loans.Don't hesitate to take advantage of the benefits of FBA bookkeeping and delegate the task to experts now! Partner with us here at Unloop so that you can have a reliable bookkeeping service for your FBA business. We also offer solutions for Shopify and DTC, multichannel sales, wholesale, and more. We’d love to discuss our offers with you. Call us now!
Disclaimer: Please note this article is not financial advice. The purpose of our blog is purely educational, so please consult a professional accountant or financial advisor before making any financial decision.
What is Peachtree software? Now called Sage 50cloud, Peachtree is one of the most popular bookkeeping and accounting software in the market. It was designed to help small and medium-sized businesses manage their financial records, streamline accounting processes, and enhance financial transparency. Sage 50cloud offers numerous features and benefits, making it an attractive choice for businesses of different sizes and industries.
In this article, we will look at five of the most compelling reasons to invest in Sage 50cloud/Peachtree. From invoicing to its advanced reporting capabilities, we will explore how Sage 50cloud can help make bookkeeping and accounting more efficient and effective for your business. Let’s begin!
Don’t worry about inaccuracies in bookkeeping, as automation is on top of Peachtree’s features. You will be sure that the details are all correct because they’ll come straight from the source: the numbers are recorded not by manual input but through integrations, bank connections, and optical character recognition tools.
Through Sage 50cloud, you’ll have visibility on employees’ rendered time, payroll details, and project management specifics. If you are in the ecommerce world, your business inventory matters a lot because you need to know the stock of each product; Sage 50cloud has inventory management, too.
Since Peachtree offers real estate and construction-based bookkeeping and accounting, business owners in these industries will know their complete building and labor costs through the help of the software.
The tool is connected through the cloud, so you can be sure of data security and robust functionality. You can manage your books through the desktop version, or you can also use a mobile device on-the-go.
Because your books are constantly updated, and you can ensure that the details inside are correct, your accounting and financial analysis will be easier. The continuously updated software dashboard will give you a complete view of your financial health.
Through the Peachtree bookkeeping software, you can generate different kinds of financial reports like balance sheets, cash flow statements, income statements, and shareholder’s/owner’s equity statements. You can also check the specifics like sales taxes, expenses, profits, and more!
If you want to see how business will go in the following months, quarters, or years, you can utilize the data to run a financial forecast. The reports you’ll get can guide you for advanced budgeting, planning, and making objective business decisions.
Peachtree also allows unlimited users, letting you and other key members of your team update and view these vital reports.
Invoicing is a task that will help you maintain a healthy cash flow as it ensures that you’ll receive payments from customers and clients on time. Peachtree allows the creation and sending of professional invoices online. It also assists you in converting quotes and estimates automatically into invoices. Because everything is computerized and all the details and data needed for the invoice are in one place, you can send invoices in seconds.
These e-documents include a “Pay Now” button to make it easier for clients to settle their financial obligations. When you have regular transactions, you can also schedule invoices to be sent automatically on Sage 50cloud, resulting in timely payments.
Peachtree is on par (or even better) than the many bookkeeping and accounting software available today. What makes it shine above others is its human resource management capabilities. Sage 50cloud goes above and beyond, offering all of these within the tool:
Sage 50cloud has features that explicitly assist individuals in the construction, real estate industry, and ecommerce industries!
The software has Sage Intacct Construction, a feature for construction and real estate bookkeeping, and accounting. It also has the Sage 100 Contractor which is mainly to help contractors and subcontractors to check job costs, project details, budget proposals, biddings, and anything finance-related. It also helps in accomplishing payroll, billing, and lien waiver creation.
Peachtree, through the Sage 300 CRE, is also a reliable tool for homes that are already built. It has a Commercial Real Estate (CRE) management feature that makes it easy for property managers to check details about their finances.
On top of this, Peachtree is also a go-to for many ecommerce sellers because of all the features mentioned above. From inventory, invoicing, sales taxes, and more, Peachtree has got any online seller’s back when it comes to bookkeeping and accounting.
Sage software offers an all-in-one solution for bookkeeping and accounting needs, with features designed to streamline accounting processes and enhance financial transparency. Overall, Sage 50cloud, formerly Peachtree, is an attractive choice for businesses of different sizes and industries that want to improve their financial management.If you are looking for a team that can help you manage your finances, from bookkeeping, payroll, taxes, accounts payable, and forecasting, we at Unloop have you covered! Give us a call now so that we can discuss our offers in detail.
Bookkeeping is the task of recording all transactions relating to business. The systematic record ensures all business transactions are up-to-date, valid, and complete. There are professional bookkeepers who can maintain books for businesses.
However, if you're a small business owner, you can take charge of your finances and bookkeeping yourself. Here is a quick look into bookkeeping systems and why they are essential for small businesses.
Many people confuse accounting and bookkeeping. Although the two processes are separate, they work together. Bookkeeping is the foundation of an excellent accounting process. When the bookkeeping process is correct, you can expect the result from accounting to be accurate and true, which will help scale your business.
To put it another way, bookkeeping is the act of documenting and collecting data, whereas accounting is the act of analyzing it. Without bookkeeping, businesses won’t be able to make sense of their numbers. To help you further understand bookkeeping, here is the objective of doing the bookkeeping process.
The primary objective of bookkeeping is to make accurate records of all business transactions to use as references in future accounting. The records in bookkeeping are reflected in books of accounts and often separated into different categories like income and expenses.
Bookkeeping will help owners see the impact of business transactions on their company's overall health. The records can help monitor monthly and annual transactions made by businesses. This financial information also helps shareholders and administrators to plan better for their future financial ventures.
Small businesses can put two main types of bookkeeping systems in place. Business entities have the option of using one system exclusively or combining both. Here is a more detailed look at each type of bookkeeping system.
Most small businesses start with single-entry bookkeeping. With this method, every business transaction or activity only has one entry in the bookkeeping record. Only sales, purchases, receipts, and payments can be maintained using this manner. This bookkeeping method can keep your finances organized if your business handles minimal transactions.
The double-entry accounting system records business transactions in two entries. Due to the fact that it records a credit entry to match every debit entry, the double-entry system offers checks and balances. Transactions are recorded when money is received or lent—it is not a cash-based system.
Most professional bookkeepers use this method since this is universally adopted and gives the most accurate recording of financial transactions.
Bookkeeping is essential to all businesses, regardless if it’s a small or vast enterprise. Understanding your cash flow, tracking expenses, monitoring accounts payable, and even tracking your sales tax starts with bookkeeping. Here are reasons why you should have a bookkeeping system.
You keep records of your transactions, but isn't it also nice to know the source of your transactions? Instead of looking at raw numbers and wondering where they came from or where they’ve gone to, bookkeeping can tell precisely whether the entry is an expense or a sale.
In double-entry accounting reports, you can be as accurate as recording the type of business expenses in your books. There are several business expenses, such as meals, traveling costs, and accommodation. The details will help you plan your finances for more efficient spending.
Additionally, you can be sure that all of your financial transactions are in one place. So, when you need to pull your records for accounting or references, you know where to look.
Bookkeeping provides businesses with an accurate overview of their performance. The information from bookkeeping is valuable for making strategic moves for your business.
Bookkeeping is a reliable source of information. Business owners can use the information as a benchmark for their income and revenue goals. Companies with excellent bookkeeping systems are more likely to achieve their business goals.
If you have proper bookkeeping, you have complete and organized data, which is crucial for preparing financial reports. Bookkeeping can summarize a business's expenses, income, and ledger categories. Balance sheets, income statements, and cash flow statements are the three primary financial statements that firms require to evaluate their performance.
It can also provide you with more detailed reports such as expense reports, sales reports, and other statements that show key performance indicators. These reports are then used as communication for the business administrators and stakeholders.
Also, accurate financial reporting can be used to attract business investors. Information on how much profit your business generates and how you handle your expenses can be leveraged to attract inventors to your business.
Income and expense tracking is vital in every business. There is more to running a business than merely making money. You also have expenses to pay that will keep your business running. It is critical to understand whether the flow of funds into and out of your company is balanced. If your expenses are through the roof, you’ll need to make more money or cut down on expenses.
Likewise, if you have a healthy profit, you can create a budget to improve your business. You can allocate it to get new inventory, enroll your employees in seminars and workshops, upgrade your equipment, expand to a new location, and more.
In running a business, one thing is for sure—you have to fulfill your tax obligations. The government requires different forms of tax payables from businesses. Bookkeeping records will help businesses calculate the exact amount of taxes they must pay.
Failure to pay your tax obligations can lead to severe consequences. Bookkeeping is crucial in ensuring you won't be fined for getting your taxes wrong.
Manual data entry is the old way. There is accounting software that can do more than bookkeeping for your business. Investing in software streamlines all accounting tasks, not just bookkeeping, for your business to help you manage your finances.
Here are some features to consider for small business accounting software:
Whether you have one small business or multiple businesses, bookkeeping can be challenging, especially if you're not well-versed in matters of accounting. Fortunately for business owners, Unloop can help you with your bookkeeping needs.
Unloop's bookkeeping services include:
A bookkeeping system is a solid foundation for organized finances and accurate accounting. We hope this article helps you understand what a bookkeeping system is. For more online accounting services, book a call with Unloop and talk to an expert for free.
Many things will worry you when you become a business owner. You’ll need to think of the quality of the products you sell, your marketing strategies, your inventory, customer feedback, and more! While some of the tasks are manageable, there are also areas you’ll probably need help with, like bookkeeping and accounting.
Getting professional help allows you to focus on the responsibilities you can handle while ensuring you stay on top of your business’s finances. Besides, managing the money coming in and out of your business is a severe obligation, as this affects the success or failure of your business.
In this blog post, we’ll answer the question, “What are financial statements?” and share how partnering with a bookkeeping firm can help you ease your worries about financial statements. If you’re still thinking twice about it, keep reading, as we’ll list eight ways to convince you that connecting with professionals is the way to go!
Before you prepare financial statements, a bookkeeping firm will help you with the basic task of keeping your books in order. All the details in the financial statement will rely on how complete and organized your books are.
Professionals will utilize bookkeeping and accounting software to ensure all your financial transactions will be recorded. Income from various payment gateways and your bank will be in the books. The expenses your business incurs will all be there too. So, when you need any financial statement you can quickly generate one.
The software these firms use generates statements in just a few clicks. Because books will be up-to-date and are constantly checked, you can be sure that the details in the statements are updated and accurate.
Financial statements are so detailed that you can see all specifics about your assets and liabilities. Some assets you’ll view are the following:
Meanwhile, you’ll also know the costs and expenses of running your business. Some details are as follows:
By seeing where your money is coming from and being spent, you can create game plans with specific targets to minimize your costs and increase your income.
With the help of a bookkeeping firm, all your financial data will be consolidated in one place. They’ll be the ones to generate the financial statements you need. After that, they will also help you learn how to read financial statements. Bookkeeping firms have Certified Public Accountants (CPAs) who will be there to analyze and make sense of the following reports.
The balance sheet is also called a financial position or net worth statement. Details like assets, liabilities, and equity can be found here. Through this report, you’ll know the value of your business and whether you can meet your financial obligations.
This statement is also known as a financial position statement. The report allows viewers to see whether your business is getting enough income to cover operating expenses and loan and debt payments. The report reflects how fast money can come into your business and how it is being spent.
When you see a report labelled as a statement of revenue and expense or a profit and loss statement, you are also looking at a company’s income statement. The income statement reflects your business’s financial performance at a given period. In this report, you’ll see details like net income, expenses, revenue, and earnings per share.
With the help of qualified professionals, the statements will be categorized as numbers in a file. Still, with a financial firm’s help, you can make sense of these financial statements to guide your decision-making.
Investors are essential for every business as they can provide additional funding for your venture to grow. A bookkeeping firm can get your finances in order and ready for a presentation for investors.
Investors will want to see your business’s cash flow statement to see how you generate cash, how fast you accumulate it, and the different expenses you have. They’ll want to know whether your finances are stable and well-managed because investors want to invest money in a company where they’ll have higher chances of getting returns.
On top of the monetary help investors can give, these individuals can also give you valuable insights about your business. More often than not, individuals who want to invest in your business are the ones who are well-versed in your trade. But of course, aside from their experience and knowledge, numbers talk louder, so they’ll still need to base their decision on the financial reports you and your partner firm generate.
It is a financial analyst’s job to make business models that fit your business, but they can only do that when they have the complete details about your finances. When you have your bookkeeping in place, a financial analyst has a sea of data to use to make accurate models for your business. They can also use collected financial statements for their analysis.
You won’t need to worry about incomplete annual data with a bookkeeping firm. Many firms backtrack your finances from the beginning of the year, even if you partner with them midyear. In the long run, you can accumulate historical financial data, which the financial analyst can use to analyze your business finances further.
Together with financial analysis are business forecasting and planning. Forecasting isn’t 100% accurate because many factors can change the forecast. The best thing you can do to get the most accurate report is to get as much detailed and accurate historical data as possible.
The historical data will become the basis of whether there are trends occurring in your business that can still happen in the present and future. You can generate how your future financial statements will look, too. And as a result, you can set a date on when you can begin talking to investors or taking the risk of getting loans.
Your business financial statements, forecasts, and plans are not only helpful when getting investors but also when applying for loans. If creditors see good trends in your forecasted financial statements and your plans to achieve more success, they’ll be confident you’ll have the capacity to pay them back. Your past, present, and future statements can also be the basis for how much they can lend you.
You’ll also be aware of your net income through business financial statements. Net income, also known as profit, is your income after deducting all company expenses. When you know your business income, you can plan what to do with your profit.
Some of the things business owners do with their profit are the following:
Various financial reports, from the balance sheets, cash flow, and income statements to your forecasts, can help you see the profits you can earn. And with that, you can see where you can spend your profits best.
By now, you should already know the importance of financial statements in your business. Financial statements can give you a view of your assets, liabilities, and equity. They will also give you an overview of your business’s profits, losses, and cash flow. However, to get all of these, you’ll first need accurate data, which you can get through the help of professional bookkeeping services.For any financial services, contact Unloop. We offer services beyond bookkeeping, too. Here, we offer accounts payable services, forecasting, payroll, and tax management. We have solutions whether you sell on Amazon, Shopify, direct-to-consumer, or multichannel. Through the help of our team of trained experts and the utilization of the latest software, we can manage your business finances smoothly. Give us a call now so that we can begin the work!
These days, conveniently running a business is just within every business owner’s fingertips. A business owner can connect with bookkeeping and accounting firms online for financial management. And these agencies can offer complete solutions from keeping books up-to-date, business planning and forecasting, payroll, income taxes, sales taxes and more! But despite having this assistance, it still pays when business owners like you know bookkeeping and financial accounting—even just the basics.
In this blog post, we’ll help you understand what income statements, balance sheets, and cash flow statements are. It is important that you still know what these reports are for and the jargon that comes with them, even if you’re getting assistance from a bookkeeping and accounting firm.
An income statement, also called profit and loss statement, is just one of the many reports you’ll get to know your business performance. An income statement shows whether your business is profitable or not. Profitability is when your business has a higher income than all business costs. If you check your income statement, you’ll see a long list of details, which all contribute to knowing your business’s profit. The details are as follows:
Operating Revenues: A company’s earnings from selling goods and services.
Cost of Goods Sold/Cost of Sales: For manufacturers, this is the money used in creating products. For retailers and wholesalers, this is the cost incurred to acquire the products they sell from suppliers.
Gross Profit: You can calculate your gross profit by deducting COGS/COS from the price of your products or services.
Operating Expenses: These expenses include the money you use to pay office rent, payroll, employee benefits, and insurance. Marketing and advertising expenses are also included here. The total operating expenses are costs that must be paid to ensure smooth business operations.
Operating Earnings: You can get your operating income by subtracting operating expenses and depreciation from a company’s revenues.
Non-Operating Income: These items bring income to the company from sources other than sales. Non-operating items include dividend income, interest income, and money earned from selling assets.
Earnings Before Taxes: As the term suggests, this is your business's income before deducting taxes.
Net Income/Profit Margin: When all costs, total expenses incurred, and taxes are deducted from the company’s earnings, you’ll get your net income. This item defines whether your business is profitable or not.
Understanding an income statement is essential for all business owners. To make the most of the report, check your net income. Apply the 5%, 10%, and 20% rules to see whether your business is going well or needs a little push. A 5% profit margin is low, so you must set game plans to increase sales and lower expenses. A 10% profit margin is a good start if you have just begun your venture. Still, aim for the 20% and up margin—a percentage considered high or good.
To validate or negate your assumptions, you can check out the income statement’s notes added by your accountant. Accountants are trained to do financial analysis, so you’ll find their insights helpful. You can also get into the details and see which expenses are hurting your business, and check if there is a chance of lowering them.
Don’t forget to do a comparative income statement analysis from one particular period to the next. It is a usual practice to compare the latest and the previous year’s income statement. But for startup businesses, you can analyze income statements more often, so you can see how your profit is doing and if there are changes you need to make with your business plans to reach your profit mark.
To know your company's assets, liabilities, and shareholder’s/owner’s equity, the report you need to check is the balance sheet. These three details in the balance sheet reflect your company’s net worth and can also be used to know whether you can pay your financial obligations.
To understand this report better, let’s check what net worth, assets, liabilities, and shareholder’s/owner’s equity mean.
Net Worth: You can calculate your business net worth by deducting liabilities from assets. Net worth, also called net wealth, shows your company’s value.
Assets: Assets may be a single category in the balance sheet, but they can be further broken down into different details to pinpoint where your company's money is coming from. Some company assets are the following:
Not all these assets are in cash form, but they all add value to your company assets.
Liabilities: This is the money that you owe to people, organizations, or suppliers. Some examples of liabilities are the following:
These liabilities can be paid in the short-term or long-term, but they will cost you one way or another.
Shareholder’s Equity/Owner’s Equity: Shareholder’s equity is the difference you get when liabilities are deducted from the assets. It is the money you, shareholders, or stockholders will get from all liquidated assets minus liabilities. If you are the sole proprietor of your business, you’ll get the owner’s equity.
There are a lot of insights you can get by analyzing a balance sheet. To begin with, you’ll know your business’s financial performance in terms of the amount of money you’ve earned or your profit through the shareholder’s/owner’s equity. The shareholder’s/owner’s equity can be positive or negative.
Positive equity is when your assets are higher than your liabilities. This means that you can finance your business operations and pay off costs or debts. When your liabilities exceed your assets, this is negative equity. You can adjust your business plans accordingly when you see your business is failing and maintain the best practices when you get good results.
You can also use this report during an investor’s presentation. Through this report, the investors can see where your money for business operations comes from and on which liabilities they are being spent on. They’ll also get an idea of what they’ll get based on the past balance sheets you provide. A positive shareholder’s equity will entice them to invest.
As the name of this report suggests, a cash flow statement shows how money comes in and out of your company. This statement has three main parts that will allow you and investors to see the details of how you spend and earn money. Here they are.
Operating Activities: As the name of this section implies, this is the money that comes in from sales, services, and regular business operations. It also tracks the money that goes out through accounts payables, tax and interest payments, and employee salaries.
Financing Activities: If you want to see how your business money moves around you, your investors, and creditors, check the cash from financing activities. This part shows the money that comes in from investors and banks and the money that goes out to be paid to debts and loans, to shareholders’ dividends, or to stock buybacks.
Investing Activities: The money you earn and give out in investing is included in this section. Some investing activities are loan creation and collection, asset acquisition and selling, and purchase and selling of fixed assets.
A cash flow statement shows how your company earns and where the company’s earnings are spent. It also reflects that the company has enough cash to pay business expenses.
An excellent looking cash flow is when all expenses are paid, and there’s still money left. This is called positive cash flow, a situation where there is more incoming cash than outgoing. On the other hand, a negative cash flow is when more money goes out of your business than what’s coming in.
It is important to note that a negative or positive cash flow doesn’t always reflect your company’s profitability. There may be times when cash flow is negative because you’ve invested in scaling your business, so it doesn’t mean that your business isn’t profitable. In the same way, cash flow may be positive because of borrowed credit and not because the company is profitable.
Income statements, balance sheets, and cash flow statements are three of the most important financial statements you’ll need to get regularly. These reports will be your basis for business planning and decision-making. When looking for investors, these are the reports you can present to show your capability to run and make your business thrive.
And if you ever need additional cash, these documents must be shown to creditors. And as a part of your business owner's daily routine, you can check these financial statements daily to stay updated.
When you understand these reports and the details within, it is easy to connect with the bookkeeping and accounting firm you are partnered with. During the reporting period, you’ll understand your company's financial health.If you are still looking for a reliable firm to partner with, Unloop is here for you! We have qualified professionals who can handle bookkeeping for your business and generate these reports. Contact us now for a detailed discussion of our services.
Disclaimer: Please note this article is not financial advice. The purpose of our blog is purely educational, so please consult a professional accountant or financial advisor before making any financial decision.
Bookkeeping and accounting are essential for any successful business. When managed efficiently, they provide a detailed account of financial transactions. Complete data enables businesses to make informed decisions based on accurate information. By understanding how to use bookkeeping and accounting to their advantage, business owners can monitor and analyze their finances, identify revenue streams, and manage expenses—all of which can ultimately boost profits.
This article provides seven ways to utilize bookkeeping and accounting to monitor your business's financial transactions. From recording transactions to making sense of the numbers through regular reports, we’ll provide practical tips and strategies to help any business maximize its financial potential.
Among the many complex accounting journal entries within your books, your financial transactions can be summarized into two details: assets and liabilities.
Assets are the funds coming from a sales transaction and the monetary value of the equipment, machines, and properties your company has. It also includes accounts receivables or the payments you have yet to receive from clients or customers. All the items in your inventory have a value and are included in your assets too. And if there are supplies or services you’ve paid for in advance but have yet to be delivered to you, categorize them as assets. Investments, trademarks, patents, and goodwill all fall under this same category.
Meanwhile, liabilities are everything under your accounts payable and those already deducted from your income to pay rent, utility fees, debts, and the cost of goods sold. These are the wages you give to your employees, the dividends your shareholders get, and even your owner’s equity.
When your company bookkeeping is in place, you can analyze where your funds are coming from and plan how to continue or increase the inflow of cash. You’ll also see cost culprits and map out how to lower them.
One thing you can do to track your income and expenses efficiently is to connect your bank to bookkeeping and accounting software. This way, all the cash coming in and withdrawals happening in the bank will automatically be recorded in the books. Transactions will also be categorized immediately so you can include bank details in your central financial system.
Through bank connections, bank reconciliation will be easier too. You can compare what’s recorded in the books and your bank statement. You can check if all transactions are accounted for, and if not, you can investigate what happened or correct the data right away.
Another responsibility you need to accomplish as a business owner is paying taxes. You are responsible for paying your yearly income tax and must calculate, charge, and remit sales taxes to the tax bureau.
But tax computation isn’t easy, especially with localized rules. Yet, you can forget your worries when your bookkeeping and accounting are in place. When all your income and expenses are tracked, you can efficiently compute your annual income, which is the basis of your tax rate. You can track and calculate the sales taxes you’ve collected from sales and remit the exact amount on time and even automatically.
As you grow your business, you need more hands to help you. Part of your business financial transactions is your employees’ compensation. You’ll be responsible for your employees’ monthly salary, incentives and benefits, taxes, and other mandated deductions.
Streamline the computation on how much they’ll get and how much you’ll deduct through bookkeeping and accounting. You can also send their salaries straight into their accounts by integrating payroll software into your accounting system. Don’t worry about late payments and keep the workforce's morale high as you can schedule payment sending through the help of payroll software.
Staying on top of your invoices can benefit your cash flow. Through invoicing, you can remind clients and customers who owe you money. With the right tool, you can schedule these reminders to ensure you don’t forget to send them and your customers do not forget to pay.
These invoices are sent online, so you won’t have the hassle of printing them on paper and delivering them face-to-face. Clients and customers can pay conveniently and skip the cash method of payment, too, as the electronic invoices also come with a “Pay Now” button. The payment goes straight into your account and gets recorded on the books automatically.
Your books that are filled with numbers and organized in different financial categories will make more sense through financial reports. Make sure that you know what the intentions of the reports are, so you can understand them better.
Assets, liabilities, and equity are the three main contents of a balance sheet. The rule is that your assets should equal or even exceed your liabilities and equity. Through bookkeeping and accounting, you can check whether your assets are higher than your liabilities and whether you can get satisfying equity from your business.
An income statement shows income, expenses, and profit. To determine if the company is profitable, you and investors can check this report. An income statement report includes the following:
Meanwhile, if you or investors want to see the cash flow in your business, check the cash flow statement. This report shows how money enters and leaves your accounts through operating and financing activities.
The statement of owner’s equity shows the money left for you after you deduct all liabilities from the assets. Ensure that your business assets are higher than the liabilities to get your owner’s share from the profits instead of the capital.
Forecast the financial transactions you will have on a future date based on the historical data stored in your bookkeeping and accounting system. Look back on your best practices in achieving the numbers and duplicate the same actions to achieve the forecast.
Make a solid plan to achieve your goals. Have the flexibility to adjust game plans as needed. You can also double up your efforts if you want to exceed your previous financial achievements. And, of course, regularly set meetings with your financial team to check your progress.
Keep your bookkeeping and accounting system up-to-date and secure financial transactions by investing in the right software. There will be some costs, but the investment will be worth it as these tools minimize human errors. They can also integrate with other financial tools. And many of them are cloud-based, so your data will be protected.
Bookkeeping and Accounting Software
Start by investing in bookkeeping and accounting software that record financial transactions in all your ventures. QuickBooks, Xero, Sage50 cloud, FreshBooks, and Wave Accounting are some tools you can check. Their features and plans vary. Pick the one that suits your business’s needs.
You can invest in tax software like Avalara, Taxomate, TaxJar, and Taxify to compute, track, and even submit the sales taxes you collect from your stores. You can also integrate these tools into your accounting system so all your business financial transactions are kept in one place.
Documentation and Data Capture Software
Manual inputs increase the risk of committing mistakes, and these aren’t acceptable when talking about finances. Skip the hassle of typing in data from printed sources like receipts and invoices, and let a software do it for you. These can turn hard copy documents into computer text for recording.
Last and not least, your business bookkeeping and accounting are handled better when you have the right people to do the job. Delegate the painstaking task of financial tracking to experts—by doing this, you’ll have more time to work on your business instead of stressing out about something you’re not confident at.
A professional bookkeeper can keep your books organized, while an accountant will help you make sense of the numbers through regular reports. They will work together to ensure that you have the financial data you need. Accountants can show you an in-depth analysis of your finances, and they are also capable of giving financial advice that you can consider in your decision-making process.
Bookkeeping and accounting play a crucial role in the success of any business. By monitoring and analyzing transactions, identifying revenue streams, and managing expenses, you can maximize your business’s financial potential.If you need assistance in bookkeeping and accounting, Unloop can help. Our team of experts can provide the professional guidance you need to help your business grow and succeed. So, what are you waiting for? Book a call with us now so we can discuss our offers with you!
Unloop is the first and only accounting firm exclusively servicing ecommerce and inventory businesses in the US and Canada. With the power of people and technology, our team dives deep into COGS and inventory accounting.. You are paired with a dedicated bookkeeping team that prepares accurate financial statements, financial forecasts, and can also pay bills or run payroll for you. Come tax time, everything is organized and ready to go, so you don't need to worry. Book a call with an ecommerce accountant today to learn more.