When you start your own business, accounting can seem inaccessible, especially if you are allergic to numbers. However, doing your own accounting not only offers many competitive advantages but has also become very accessible thanks to today’s tools, even if you have never done accounting in your life. Doing your own accounting does not necessarily mean doing it without a certified public accountant. It is mandatory for certain types of companies, such as craftsmen. Moreover, having a chartered accountant can help you with your tax optimizations and thus make you save a lot.
We are talking about doing the “accounting entry” yourself. This is what represents the history of the flows that have passed through your company. In reality, you probably already do a large part of this data entry work every day to be able to follow your customer payments, dungeon your invoices or follow your supplier expenses. So, without further ado, let’s dive into this blog and learn some of the reasons why you need to keep your own accounts.
1. You will save money
An accounting firm charges two types of services in a package: advice and data entry. On average, you pay 2 $ per sales or purchase invoice document entered with its payment. Count your number of sales and your number of purchases per year, and you will have the cost of your input.
However, you probably already write this information in your invoice editor when you invoice your customers. So why pay your accountant to enter this information a second time? Same thing if you already do your payment tracking. Using software that allows you to generate your accounting from your daily management will save you the cost of double entry!
2. You will better follow your company’s activity
Do you know how much your customers owe you as you read this? How much do you owe to your suppliers? What is your turnover? Running a business on sight can work, but it creates uncertainty and stress. But accounting is not just a legal obligation. It is a fundamental tool for managing your business!
By doing your own bookkeeping, you naturally know your daily figures and gain peace of mind. You are able to know quickly if, for example, you can or cannot make an investment or take a break. This allows you to have a better control of your expenses and consequently to refine your profitability.
3. You will better understand accounting
There are two ways to learn: start with the theory and then practice applying it in practice, or start with the practice and deduce the theory. When running a business, the second method is more applicable: learn by doing. Accounting is a set of complicated words for very concrete and simple concepts that you probably already know.
By doing your own accounting, you will naturally improve your skills over time and without the need for theoretical training. You will therefore be more and more able to understand the concepts of accounting and, therefore, your own management. The more you understand the meaning of your numbers, the easier it will be for you to resonate with their impact and thus make relevant decisions.
4. You will have an up-to-date accounting system all the time
Delegating your entire accounting to a third party doesn’t allow for as much responsiveness. Your accountant will never be able to process your invoices as quickly as you can. How long do you need your accountant to send you a financial statement? Doing your accounting yourself anchors your management in real-time, quickly and efficiently. You gain a lot in reactivity. No more stress in waiting for documents; you already have them at hand.
5. You will save time
This light and daily management not only brings reactivity but also allows you a much better organization. How much time did you spend gathering the papers for your last balance sheet? How many trips back and forth with the accountant for all the missing documents?
By doing your data entry yourself, your accounting is ready for the balance sheet at the end of the fiscal year. A powerful accounting management tool will not only allow you to save time all year long on your accounting but also to say goodbye to the “tax period”. All you have to do is export your data and send it to your firm. Less stress, more serenity.
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