Introduction
One of the most
important parts of running a business is record keeping. A high proportion of
small businesses fail, and frequently it is caused by poor record keeping. You
need to learn to keep good records and as your business grows, hire someone to
do it for you. This training module focuses on the basic records that you need
to keep in order to be able to generate proper books of accounts. This is not
meant to make you an accounting expert, but to help you
·
Keep all your accounting records easily and
effectively
·
Understand financial statements
·
Price your products and services appropriately
·
Manage your cash flow effectively
What you need in
your business are documents called financial statements, which will tell you so
much about how you're doing that it will amaze and excite you. Your goal is
accurate financial statements. Properly kept books will help you make
sound financial decisions... rather than waiting for the bank statement to see
if you have any money... or having "surprises" at the end of the year
when your accountant prepares your books.
Why
keep good records?
·
Price your product accurately.
·
Know if you're making or losing money - in general and
on specific products
·
Know your cash flow - short and long term.
·
To make business decisions
·
Work with bankers and investors
·
Tax Purposes
·
Basic Record Keeping
Record
Keeping
Proper record
keeping is difficult and almost impossible without these three (3) Key Success
Factors:
·
Open a bank account for your business
· Place yourself on a salary. You are different from
your business. Business sales is company money, no business owner’s money
·
Be committed to doing your books and your
business right
Look out for the
next article of practical case studies of how do to a proper book keeping.
To your
success!
Felix
Smith Aigbonohan.
A
Business Development Consultant & Facilitaor
The CEO, Xterics
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