A Small Business Guide to Bookkeeping Basics.

Bookkeeping is an essential task for any small business, and it's important to get it right from the start. Here is a guide to bookkeeping basics for small businesses.

1. Set up a bookkeeping system: First, you need to set up a system to keep track of all your business transactions. You can use a software program or a manual system such as a ledger book or Excel spreadsheet.

2. Separate business and personal finances: It's crucial to keep your business finances separate from your personal finances. Open a separate business bank account and use it for all business transactions.

3. Record all transactions: Every time you make a purchase or receive payment, make sure to record it in your bookkeeping system. This includes sales, expenses, and any other financial transactions related to your business.

4. Keep receipts and invoices: Keep all your receipts and invoices organised and easily accessible. This will help you to track your expenses and to ensure that you have accurate records for tax purposes.

5. Reconcile bank statements: Reconciling your bank statements means comparing the transactions in your bookkeeping system with those on your bank statement. This ensures that your records are accurate and that you haven't missed any transactions.

6. Prepare financial statements: Regularly prepare financial statements such as balance sheets, income statements, and cash flow statements. These statements will give you an overall picture of your business's financial health and help you to make informed decisions.

7. Understand GST: If your business is registered for GST, you will need to keep accurate records of all your GST-related transactions. This includes both GST paid and received, as well as any GST credits that you are eligible for.

8. Seek professional advice: If you are unsure about any aspect of bookkeeping, it's always a good idea to seek professional advice. This could include consulting with an accountant or bookkeeper, or attending a bookkeeping course or seminar.

By following these basic bookkeeping principles, you will be able to keep accurate and up-to-date records of your business finances. This will help you to make informed decisions and ensure that your business stays on track financially.