Small Business Bookkeeping: It’s Harder Than You Think

Every business has a bookkeeper and in the world of small business, it’s often a family member or someone you are loyal to. After all, how hard can it be to keep the books, right? Here’s the thing: it’s harder than you think if you want good books.

Your books are a record of your company’s financial and non-financial life. Poor, sloppy bookkeeping can have a negative impact on your business in many ways:

  • Paying more taxes than necessary
  • Cash flow problems
  • Penalties and interest on payroll, GST, and other remittances
  • Poor business decisions based on incorrect information
  • CRA reviews and audits
  • Increased year end preparation fees because the accountant needs to rectify your books

A good accountant can’t do effective work based on shoddy books. In the past, we’ve often had to spend a lot of time fixing clients’ books before we could prepare their financial statements or tax returns. This is costly for our client, who has already paid the bookkeeper for what we now have to fix, and it is an ineffective use of everyone’s time.

Today we simply manage the bookkeeping for our clients so there are no issues with the books; they are always up to date and always correct. This makes our clients’ lives much easier, saves them money, and allows us to quickly deliver the information they need when they are faced with a business decision.

What Goes Wrong with Bookkeeping

There isn’t one single right way to do bookkeeping. How your books are kept needs to be based on what information you need to make good decisions for your business. A good bookkeeper works with you to understand how you and your business work and what information is needed. A good bookkeeper also has a strong understanding of accounting and of your accounting policies and procedures, and is able to effectively manage your cash flow.

Things go wrong when business owners don’t value bookkeeping and hire someone who doesn’t invest the time and effort into understanding their unique business and information requirements. All of your accounting is based on bookkeeping. Paying for a top-notch bookkeeper is one of the best investments you can make in the success of your business.

What to Look For in a Bookkeeper

Many business owners think all bookkeeping is the same and are unable to tell a good bookkeeper from a poor one. Here are a few things to look for to determine whether your bookkeeper is working for you:

  • Your bookkeeper asks a lot of questions. Great! You’ve got a good bookkeeper. It may be a pain to have to answer questions, but if your bookkeeper doesn’t ask questions, you’ve got a problem, because your accountants are going to ask them at your year-end. And your accountants will charge you more.
  • Your bookkeeper refrains from offering tax advice. In general, bookkeepers are not tax experts and should not be advising you on matters related to tax.
  • Your bookkeeper embraces automation. We’re living in the 21st century with a lot of technology at our fingertips. Using it can reduce the cost of bookkeeping or give you more value for your money. For example, rather than keeping all of your receipts in a shoebox to bring to your accountant, technology allows you to snap a photo of the receipt and you’re done. Easy as that.
  • Your books are always up to date, allowing you to make timely decisions.
  • There are very few adjusting entries at the end of the year. This indicates that the accountant spent minimal time fixing the books.

Great Bookkeeping Services

With our bookkeeping services, which come as part of our Untangled and Unburdened service packages, or as a custom package to suit your needs, you can completely relax. We set your system up so everything comes into us automatically—bank statements, cell phone bills, all the accounts related to the business. The only things you have to send in are the photos or scans of receipts, which take seconds.

We set up the books based on the individual business, giving guidance on which items need to be categorized or explained in more detail and which don’t matter. Using technology, you have real-time information at your fingertips so you can make informed financial decisions throughout the year.

Our system also relieves you of the burden of tracking payables. Instead, we provide a weekly, monthly, or quarterly list of which payments need to be made. All you have to do is click on what you want to pay and the payments are automatically dispersed. Invoicing is just as easy as is handling accounts payable and payroll.

We’ll also prepare and file your:

  • T5 Summary and slips (with a reconciliation of slips to owner’s draw)
  • T4 Summary and slips
  • T4A Summary and slips
  • T5018 subcontractor slips / T4A slips
  • GST returns
  • Alberta Annual Return
  • WCB return

Our system is elegant and frees you up to focus on your business, but it all begins with the bookkeeping. With great bookkeeping, we’re able to give you a holistic solution to all your other financial needs. We don’t have to replace your existing bookkeeper, however we will manage the process so you can trust that we’re overseeing everything the bookkeeper does to ensure that things are done right!

Contact us today and let us help you get the great bookkeeping you deserve.