Record keeping is very important in any business, even one where there are no partners. Records are important not only to help you keep track of your actual profits/losses but also because you will need them when it comes to filing taxes. If you are a limited company you will also definitely need your records not just for taxes but for reports to be shown to the board and shareholders.
Keeping financial records can be quite a headache although if your business is still really small you can probably do this by yourself. However, if this isn’t your strong point hiring an accountant to do this is the right move.
Note though that records pertain not only to financial records but to everything from your inventory to time log. Make sure you have a good system for each kind of information you need kept so that in case you need to search for any specific information it won’t be difficult to find it. Keep in mind that while you may have clear cut guidelines regarding record keeping some employees might not always adhere to these guidelines. This is why it is also important that you have a way to check whether the records are being updated properly and regularly and that everyone understands the important of this in keeping the business healthy.
Originally posted on March 28, 2008 @ 6:45 am