Setting up Your Startup Accounting

Setting the Record Straight 

Starting a new business can be a major endeavor for any individual but making sure your accounting is on point right from the get-go is vital in today’s economy. If your finances are not in order from day one, from the start of your business plan, you could be headed into major trouble six months to a year down the road. Having a solid plan on how you will set up your startup accounting requires some thought and expertise. Seeking advice from a professional and doing an ample amount of research before you dive right in, might be the start that you need to ward off future financial issues.

Starting Right is Starting Fresh

Have you ever tried to balance your checkbook after a year of not doing it? Do you have a bill and can’t remember if you paid for it? If you take small issues like this, and magnify them, you will see why starting strong with your startup accounting is so important. It is vital that you have the correct numbers to start with. How much debt do you have? What are your beginning checkbook balances? How much do you have invested into the company? What is your weekly payroll? What are your business expenses? What kind of income do you project taking in? There is nothing better than starting with the correct numbers on all your accounting, because you are starting fresh and can maintain accuracy from there.

Accounting in the Digital Age

There are many software programs that will not assist you in keeping track of your startup accounting. However, hiring a professional Baltimore startup accounting team may be a good idea if you just don’t know where to begin. There is more to accounting than just keeping track of your debits and credits. Payroll, taxes and insurances can blindside you if you are not prepared. You may be an expert in your industry, but sometimes it is better to leave accounting to the professionals. If you do decide to take this on yourself, having the right digital software that matches your business is important.

Good Records Will Save You in the Long Run

There are many businesses who end up getting in a lot of trouble because they do not keep accurate records. They can be audited by the government, their property can be seized for not paying taxes on time, or they can lose manpower because they cannot afford payroll (or pay it on time). Starting with the correct setup can prevent some of these problems and running regular reports to evaluate where you are truly at can be a business saver. On the other hand, if you keep excellent records, you will more likely able to be granted a loan, grant or other types of funding because investors can see in black and white how organized your finances are. Again, making sure that your accounts are accurate from the get-go is essential.

Startup accounting is one of the fundamentals to running a business correctly. It is important to have a routine and standard operating procedure of how you will document your credits and debits, accounts payables and receivables, and that you reconcile any bank or credit card accounts monthly. Falling behind just a little bit can cause checks to bounce, bills to go unpaid, and leave a headache for data entry. But keeping on top of your accounting from the start, you can stay on top of it. If something is outside of your knowledge base, seek assistance from a CPA or professional accountant. For a small fee, you can obtain the services that you need that will keep your financial statements in order.