Key Bookkeeping and Accountancy Practices for SMEs
Is your business striving to roll on higher efficiency? To get your business rolling, you need help to maintain your finance for ongoing success. In the market, you can find countless pieces of advice on accounting and bookkeeping practices for SMEs. Nowadays small business organisations are looking for integrated solutions to the tailored business needs. They sometimes get confused with the distinction between accounting and bookkeeping. As accounting and bookkeeping, practices are constantly evolving with the latest advancements in the technologies and standards, to withstand the competition in the markets, you need to get updated frequently. Hiring a professional accountant can help you to enhance the value of your business through day to day bookkeeping tasks and reportings. Here are some bookkeeping and accounting practices which are performed by hiring the right accountant in small-medium enterprises:
Separate your business and personal finance
If your business is small, you handle all the purchases and payments by yourself. Sometimes you might be the only person accessing funds, ensure you maintain a separate track for your finances. Make sure your employees do not use business funds for personal purchases. Improper allocation of funds results in cash flow issues and auditing complications. Create separate bank accounts for your business and allot funds for business use.
Choose the best Accounting Software
While deciding on the accounting software, consider whether it meets your current accounting and bookkeeping needs. Evaluate each software system and technology to scale with your business as it grows.
With a solid core accounting software and cloud-based expense technologies, will put a stop to the strain on your time. It will help to maintain a thorough record of business revenue and expenses.
Structurize your Chart of Accounts
Chart of accounts acts as the foundation of the accounting function. It helps you to keep track of your costs and investment for expenses. It separates your General and Administrative (G&A) expenses and Industry-specific expenses along with the discretionary costs you can cut in a downturn.
Manage Your Accounts Payable and Accounts Receivable
Impeccable maintenance of your Accounts payable and Accounts receivable as the cash on hand helps in the smooth running of a business. Always choose to pay the right amount on time. Try to avoid late fees to take advantage of early payment discounts. Prompt release of invoice and follow up on any past due accounts enhance the cash flow.
Introduce internal control practices
Introducing internal control measures in your organisation can reduce the risk of fraud. These measures ensure a repeated checklist of all forms of transactions dually. Reconciliation of bank accounts and cheques issuance must be frequently monitored. Examples include handing over the copy of cheques to the accountant and sending confirmation emails to the management etc. Frequent asset audits and data backups are also part of internal control measures.
Efficient Tax planning throughout the Year
Hiring a tax consultant on a regular basis to maintain records and track expenses is very helpful during VAT filing as he maintains the systematic record of all documents. Transparent and accurate records of tax filings help to reduce the overall tax burden and penalties in case of any wrong filings.
Evaluate Your Financial Statements Monthly
On leveraging your financial statements, you can find the rundown areas of income earned and expenses incurred. A monthly report helps you to understand the business drivers and financial stability of your business. Discrepancies in the transactions can be easily figured, which helps to make smart decisions and future investment plans for the growth of your business.
Why choose CDA?
CDA experts are familiar with a wide range of industry backgrounds and always ensure to deliver explicit results to our clients. We have conducted internal and external auditing for various firms in profound detail and have effectively stirred up company performance. CDA being a fortunate group among the firms in Dubai. We offer financial assistance by providing financial services such as Internal Auditing, Tax Auditing, Management Accounting and Bookkeeping and VAT Consultancy and we take a strategic approach for providing services to our customers.
If you have any queries, feel free to contact us. Our experts are at the receiving end to attend your call and answer your queries. CDA offers a one-hour free consultation.
