Necessary Accounting Steps for New Businesses

Ensuring you have the proper accounting and bookkeeping procedures in place is one of the most critical aspects of starting a business. Unfortunately, they are also often the most overlooked. Here are seven steps to help new business owners have a strong financial start.

1.     Determine Entity Type – It is critical to select the correct entity type up front and based on complete information. You should discuss this choice with a skilled Certified Public Accountant (CPA) before making a final decision since it has long-term tax and legal implications.  

2.     Open a Dedicated Business Bank Account – Your business funds should never be intermixed with other funds, especially personal funds. Setting up a separate business account is not only the smart move from a legal standpoint, it will also make life easier when handling accounting and bookkeeping for your business. 

3.     Set-up a Bookkeeping System or Hire a Professional – It is important to accurately track, analyze, and record daily transactions. There are multiple programs out there that will do this for you, or you may find that outsourcing your bookkeeping is the best option for your business.

4.     Track Business Expenses – There are many expenses incurred when starting and running a business, so make sure you are collecting the required receipts and documentation as you go. These include business related expenses for meals, travel (to include vehicle use), and gifts.

5.     Establish a Budget and Forecast – It is essential to estimate your incoming and outgoing expenses for your business in both the short term and future. This will help you to set goals for your new venture and understand the basic financial health of the business.

6.     Establish Payroll System – Even if you do not have employees, you still need to pay yourself.  It is not as easy as transferring funds or writing a check. Similar to bookkeeping, there are programs you can use to handle payroll or you may want to consider outsourcing this task depending the number of employees and complicity of the task.

7.     Clearly Understand your Tax Requirements – You need to comply with tax obligations from day one. This includes understanding sales tax requirements and your tax payment schedule. The schedule alone varies depending on your tax entity, income, and the amount you will owe in taxes.

 

Kickstart Accounting, Inc. is here to help if you need assistance with any of these steps or are considering outsourcing your accounting and bookkeeping needs. Contact us today at support@kickstartaccountinginc.com or through our Facebook page here: https://www.facebook.com/kickstartaccountinginc/.

 

Source:

https://www.shopify.com/blog/15334373-small-business-accounting-101-ten-steps-to-get-your-startup-on-track

http://founderscpa.com/new-business-accounting-checklist/

Choosing the Right Accountant

You work hard to make your business profitable, and it is important to hire the best person or firm to handle your finances. An accountant will serve as a trusted advisor and partner as you continue to operate and grow your business. Here are a few items to consider when selecting the right accountant for you:

~~Clearly Understand Your Needs Before you begin the selection process, it is important to have a solid understanding of your current situation and business needs. Do you need someone to handle everyday bookkeeping and weekly payroll? Are you hiring a firm to provide general accounting expertise and recommendations regarding the financial health of your business? Some firms offer both bookkeeping and accounting services, while others only specialize in one area. Starting with a strong knowledge of the services you need will help to shape your search and make the process go smoothly.

~~Ask for Referrals There are many accountants and accounting firms out there. As such, starting your search can be intimidating. To narrow your options, ask your friends, fellow business owners, and trusted advisors (like an attorney) for recommendations. You can also find options through the Society of Certified Public Accountants in your state, as well as through various online resources.

~~Do Your Research Once you have a few potential accountants and firms picked out, it is time to start researching to ensure they meet your needs. Begin by reviewing their website and social media pages to make sure they offer the right services. Additionally, confirm they have the appropriate credentials and hire Certified Public Accountants.

~~Schedule a Meeting An in-person meeting with a potential accountant is important before making a final decision. While your accountant does not have to be your best friend, it is important that they are someone you feel comfortable working with. This is also the appropriate time to discuss fees and costs, along with frequency of services and correspondence. You may also want to request a list of references focusing on businesses similar in size to your own.

These tips should help you during your search for the right accountant. Once you select and hire an accountant, remember to maintain the relationship. This includes checking in periodically to reevaluate your services. As your business grows, your financial needs may change or increase.