Book keeping and Accounting

Planning your budget for your business is critical for survival. You can’t let your business run out of money. It’s the equivalent of a car running out of gas. The #1 reason for the failure of new businesses is lack of funding.

Even established businesses fold due to poor financial management. It’s a sad fact that 80% of new businesses go under in the first five years – due to a problem that’s preventable.


What You Need to Know About Your Company’s Finances

With some simple planning and thinking before you spend, there’s no reason to let your business run out of funds. Here are a few pointers to help you with your bookkeeping and accounting.

First, you need to make multiple budget plans for:

· One month

· Three months

· Six months

· Nine months

Your plans will depend on how much you can afford. To figure this out, make sure you do the following crucial steps:

1. List all the expenses for the business

2. Make a special budget for your promotions.

3. For the first three months, don’t expect to make a profit, and budget accordingly For the next 3-6 months, reinvest any profit that you can spare back into the business.

Decide how much you can afford to invest in your business and set it aside each month.
List all the expenses for the business, keeping marketing/advertising separate. Write down and then prioritize the other expenses. Take half of your funds and allocate how much money you will need for each one.

The other half of your funds should be allocated specifically toward your promotions. You cannot afford to run out of funds for marketing your business, and that will be your biggest expense, especially for the first year. List all the ways you can promote your business and estimate the cost of each promotion or campaign.

Start with free and cost effective methods and work up to the expensive campaigns when you have available funding. Stay focused on one promotion at a time. Do your research before investing your hard earned money into any promotion.

The trick is to start small and build on your successes. As you do this, you’ll expand your marketing budget and develop your business into a strong, sturdy company with a stream of profits, instead of losses.

Remember to be flexible with your budgeting. Few businesses make serious money in the first three months. Don’t expect your business to be any different. If you take this into account, you won’t be disappointed or overstretch your finances. Think of any money made at this level in your business as a bonus that should be reinvested to ensure the growth of your company.

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Your company should be seeing a little profit as your marketing efforts start to kick in after about six months to a year. Reserve at least half of your profits for promoting and developing your markets.



You’ll be able to forecast your profits and losses more accurately after about a year in business - when you have the records in front of you from the previous year. Note your actual earnings for the last six months
Review each month and note the growth of the business compared to your forecast. You can get a general idea of financial development from this.


Software to Keep the Books Straight

There is a variety of bookkeeping software on the market that will help you keep all of your bookkeeping and accounting on target. They work with your online banking systems and are easy to install.

Coordinate all of your online banking within your software and save time by automation. These programs are a quick and easy way to track sales and expenses.
This will save you valuable time and make your bookkeeping

It’s very important to keep accurate records since this will be used for your monthly, quarterly, bi-annual and yearly reports. These reports, when compared, will give you an idea of how fast your business is growing and what you can do to save and make more money.

Have two separate bank accounts - one for your household expenses and one for your business. Don’t have one borrow from the other account. This is a common mistake made by new businesses and can lead to financial problems in the future.

When you have separate accounts, you can also manage your finances better. It will be easier when you file your taxes to have the business and home finances on separate accounts, and if you’re incorporated, separation is required to keep your corporate status.

Taxes will vary from state to state, country to country but here are a few tips to help you: First, keep each and every one of your receipts, payments and expenses. Second, keep some money aside for your taxes at the end of the fiscal year.

If you hire employees, you may want to set up a payroll service that will take care of cutting and sending the employees their checks for each pay period. A payroll service will take care of all tax issues with employees and their checks. This is fairly expensive, but will save you a lot of time and trouble in the long run.


When you make it a top priority to keep your accounting and bookkeeping straight, you can enjoy having your own business. When you plan and budget your business expenses, you’ll help insure that your company won’t run out of money and will continue to prosper for many years to come.