Accounting 101: Do You Know What You’re Doing?

Accounting 101: Do You Know What You're Doing?

The word “accounting” strikes fear into the hearts of most mere mortals – even accountants themselves. But for startup entrepreneurs, that fear becomes a reality on a daily basis. They have to somehow juggle their accounts, navigate complicated jargon and make the taxman happy – a taxman who threatens to come down on them like a ton of bricks if they don’t comply with his outrageous demands for their money. Suffice to say, it’s not always the most fun part of running a business.

Accounting 101

So what can budding entrepreneurs do to make sure that they get their heads around accounting basics? Let’s take a look.

Start Off As You Mean To Continue

Entrepreneurs make a habit of making habits. They do things like check their emails every time they get to their computer in the morning, they file away their invoices on a Thursday afternoon like clockwork, and they review their inventory each week. But for reasons that we won’t elaborate on here, making a habit of business accounting isn’t always one of them.

For entrepreneurs who struggle with this, setting a recurring alarm on a calendar can often help a great deal. Make sure you write a reminder to yourself in capital letters that says something like “REVIEW YOUR BOOKS!” just to make sure you’re keeping up to date with your duties. Remember, things can get out of hand pretty quickly as receipts mount up and invoices come in.

Learn The Language Of Accountancy

Do you know what a general ledger is? How about your accounts receivable? What about the difference between cash versus accrual?

The problem with accounting is that so much of the language around it is counterintuitive. Accounting practices developed a long time in the past, meaning that many of the terms that used to make sense back then aren’t so obvious now. Many entrepreneurs get around this problem by doing a graduate diploma in accounting online where they can learn the basics as well as break through some of the language barriers.

Choose Software That Works For You

Nobody does their accounts by hand anymore. And if they do, they’re just torturing themselves. There are now dozens of pay monthly accounting solutions out there, which we won’t go into here, that can make processing your accounts ten times easier.

Accounting 101: Do You Know What You're Doing?

Features you want to see include things like automatic receipt scanning and recognition, the ability to connect your business bank account to the software, and capacity to do payroll. It’s a good idea to spend a bit of time investigating which systems are best for the type of business you run. If you run a business from your iPad, obviously you want an accounting solution that hooks up to the cloud.

Take A Peek At Some Of The Good Advice Out There

When it comes to accounting, entrepreneurs aren’t entirely alone. It turns out that there are dozens of working groups and seminar courses out there to choose from. One is the British Columbia Innovation Council. They have resources designed to help entrepreneurs file their taxes on time and so on.

FG Editorial Team
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