Business March 4, 2019 Last updated February 27th, 2019 179 Reads share

7 Strategic Accounting Tips to Boost Your Startup

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Starting a business is hard work and while business plans, product development, and marketing are crucial, neglecting accounting needs can be fatal. Launching a startup requires a solid infrastructure which includes plans for marketing, operations and most importantly; accounting. If you aren’t a number cruncher, this can be a difficult task.

A lot of startups fail because they do not pay adequate attention to their financial and cost models. It is important to know the status of your capital, where your money was spent and what changes need to be made. Basic accounting knowledge can help startup owners run their business more effectively. These strategic accounting tips can help you cover your accounting base and before moving to the next step.

 

  1. Create Separate Bank Accounts

You have launched your business, congratulations! The next step is to create a bank account to record your financial transactions. Having a separate business checking account will be less stressful in terms of keeping records distinct, organizing funds and planning for taxes. It will make recording business transactions easier for founders. To avoid combining your personal and business assets, create separate accounts for withdrawals and deposits. Before opening your bank account, do your research, look at different banks and compare their fee structures.

 

  1. Establish Financial Goals

Establishing S.M.A.R.T financial goals around your business model is a crucial business activity. Building financial milestones can allow you to stay on track and make the necessary increments for constant growth. Achieving little goals along the way can give you the confidence to hit a larger milestone. Some common financial goals for startups can center around Profitability, Cash Flow and Profit Margins. Financial goals can help you effectively monitor business growth checkpoints on your business journey.

 

  1. Track And Monitor Expenses

Most startup founders make a common mistake of not having a ledger for their financial activities. They do not record every expense from the beginning and are too focused on customer acquisition. A good bookkeeping accountant and software can help you effectively record your financial transactions. Not tracking your expenses can be an extremely costly mistake from a tax and cash flow perspective and turn away future investors. Write everything down!

 

  1. Hire Experts

“Time is money and expert accountants will save you time, money and possibly your sanity”

 

Startups function in high-frequency environments and can often skip crucial business steps along the way. Accounting and financial experts can help to develop performance evaluations and do business health checks to keep the company on track. Having experts can make the entrepreneurial duty less stressful, and help founders focus on key business decisions. An accountant in London can provide you with a financial map to take final decisions and prepare your company for accelerated growth. Delegation can also help your company cut bleeding cost margins that stunt growth.

 

  1. Automate Manual Tasks

In the operational journey of a startup, there are always manual tasks that can be automated. It is true that certain functions must be handled manually, but to ensure consistency, saving time and increase efficiency automate whatever you can. Services such as IFTTT are available online that can help businesses achieve their automation goals. For accounting purposes, a solid software infrastructure will save money and prevent costly manual errors.

 

  1. Research Tax Law

Nothing sinks a startup’s budget faster than a big tax bill. Every process of your business from an operating structure to tax deductions should be kept in focus while preparing tax returns and cash flows. Having knowledge about tax implications for your business allows you to make choices about spending and allocating liquid capital. An important step can be to call a tax and legal consultant helpline to take advice on your business.

 

  1. Create Budgeting And Forecasting Scenarios

Sustainable budgets require realistic estimations of revenue and expenses that might incur in the future. Some expenses like payroll and leasing fees remain static other like merchandising change over time. Startup costs are variable, but as the expenses grow founders should be prepared for future scenarios. Anything can happen during a business lifecycle, therefore it is best to create sustainable budgets and financial forecasts. Forecasting helps business owners keep reserves for future expenses. These expenses can be both personal and related to the business.

 

Conclusion:

Starting a business can be overwhelming, but keeping it on track is as crucial as the starting line. Smart business planning and intelligent accounting solutions can help your business achieve rapid success. Every task inside an organization is related to other tasks and has an impact on the overall success of a startup.

 

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Sohaib Ahmad

Sohaib Ahmad

Sohaib Ahmad writes articles for businesses that want to grow rapidly. His articles have appeared in a number of e-zine sites, including EzineArticles.com, ArticlesBase.com, HubPages.com, and TRCB.com. His articles focus on tips and tricks to grow business. Learn more about how Sohaib’s Business articles could help you to grow your business by visiting his blog at https://chacc.co.uk/blog/

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