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Why Bookkeeping Matters

Bookkeeping is not very fun, and if you skip it, you won’t notice for a while. You might also secretly doubt if you have to do it at all. But almost every business will use some sort of accounting file to store all of their financial data. In some cases, this could mean using Microsoft Excel (though we don’t recommend that). More often, it means using a solution like Xero or QuickBooks. But bookkeeping is much more than 'hygiene'.
Why bookkeeping matters

It gives you a clear picture of where you are going

You may be able to see your bottom line by glancing at your bank balance, but the ups and downs in your account are also telling a story. Are you in profit? Are sales up? Are your expenses too high? Shall we take a guess? Paying attention to your financial reports is a great way to get to know the story of your business.

Claim the right deductions for your expenses

Owning and operating a business comes with some perks. Some things you can write-off are travel expenses, phone, utility, and internet bills. But taking advantage of these benefits is impossible if you've been keeping your personal and business expenses together! On that, check out our Guide to Business Expenses.

It helps you catch errors

If you wait until the Year End to reconcile your financial transactions, you are going to be buried in paperwork. You won’t know if the bank made a mistake until you’re buried in it! Equally, you'll never know if any errors were made in recording your financial transactions until it's too late. This can prove costly in both time and be more difficult to reconcile months later, than if you’d caught errors right away.

It makes financing your business alot easier

Are you thinking of your next funding round, or applying for a loan of line of credit? If your books are not up to date, then it's alot harder to secure. Having well-kept books gives lenders or investors a clear idea of your business’ current financial state, and allows them to make financial projections about your company’s ability to pay off your loan in the future. Professional Bookkeeping can give you what you need to take that next step in growing your business.

Want to learn more?

Are you ready for better books? We hope these points have helped make your decision a little easier about managing your bookkeeping.

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