Consider These Factors When Selecting Bookkeeping Software

The tasks involved in managing the books for your business should not be taken lightly because good bookkeeping means making good financial decisions. If you do not pay attention to your bookkeeping system, major oversights can wreak havoc on your business. Since bookkeeping is a time-consuming task, you need to invest in reliable bookkeeping software to make your job easier.

The software will also enable you to see the strengths and weaknesses of your business. Using bookkeeping applications will give you and your bookkeeper the ability to access the books from another location. You do not have to worry about security because with today’s technological advances, financial information can be securely accessed. There are plenty of options on the market and choosing can be a bit difficult. There are five factors to take into consideration that will help you with the selection process.

1. Price

Business owners who are concerned about the cost will explore free options. However, skimping on bookkeeping software may not be a good idea. While quality comes at a price, there are still some options that offer quality and savings at the same time. You can still enjoy efficiency in your bookkeeping system without worrying about the price tag.

2. Data Protection

Security is a common concern for business owners who store their financial data in the cloud. The vital information can be compromised if the level of security of your software is not high enough to counter threats and breaches. If you are going to choose cloud-based software, make sure that it has the ability to block malicious activity. It should have Secure Socket Layer (SSL) encryption, routine external audits and multi-layered firewall server protection.

3. Integrates with other essential tools

When it comes to ensuring that your  business operation runs smoothly, you need to use a plethora of tools on a daily basis. If your software does not have the ability to integrate with your other business management tools, you will find it difficult to keep up with your day-to-day tasks.

4. Ease of Use

It is important that the software you choose is easy to use. It should have a straightforward dashboard that enables you to check your company’s financial health. It should also highlight your key accounts and give you insights of the performance of your business. If you find it difficult to use the software, you are instantly defeating the purpose of simplifying your bookkeeping operations.

5.Customer Support

When learning any new software, it is important the software providers are available to provide you additional support when answers to your questions are not in the manual. You can choose for software that offers training such as webinar and video tutorials so you can familiarise yourself with using the bookkeeping software.

Streamline Your Bookkeeping Operations In Four Ways

Being in a business allows you to take control of your future.  It breaks the cliché of earning money that often entails punching the clock and carrying out the task assigned to you. Running a business is indeed exhilarating, but reality sinks in once you deal with bookkeeping. While reaping the financial rewards of your hard work is the motivational factor of being in a business, ensuring that bookkeeping is properly done can be such a daunting task.

However, it is an integral part of your business. If you do not keep detailed and accurate financial records, you will never stand a chance to be in business for long. This may not be the fun part of your business, but you just cannot afford to take bookkeeping for granted. However, there are improvements in modern technology that enable you to streamline bookkeeping operations. This means, you no longer have to consider bookkeeping as a serious pain.

Streamline your bookkeeping operations with these five techniques

1.    Be sure to get everyone on the same page. Creating a culture in the workplace is the first step you need to take if you wish to streamline your bookkeeping operation. Whether you have a few and hundreds of employees, you need to make sure everyone is on the same page. Workplace collaboration is important in ensuring that your employees submit accurate expense reports.

2.    Create specific categories. If you have already developed a habit of tossing your receipts in a shoebox, bookkeeping can be such a headache at the end of each month. By establishing specific categories, you will be able to find it easier to identify your expenses. This technique simplifies bookkeeping and you will also ensure that the details in your report are accurate.

3. Keep records up to date. When you have little time and so much work to do, you can be easily tempted to fall behind on your bookkeeping task. Bookkeeping may have to take a backseat if you have a number of duties to fulfill. However, this is not a sign of a healthy business. Make sure you keep your financial records up to date and in order. This will only happen if you are doing the bookkeeping regularly.

4. Reconcile with the bank. Bank reconciliation can be time-consuming, but it is part of running a business. You do not have to stress yourself with reconciling with the bank statement because technology enables you to integrate account information with your bookkeeping software. This means that the job that used to take hours can now be done in minutes.

How To Enhance Your Bookkeeping Process

While going digital does not necessarily mean jumping at every new technology on offer, you still need to act fast or you will end up left behind of businesses that have already used advanced tools to simplify bookkeeping processes. Bookkeeping has come a long way because of the existence of software and management tools. The software can reduce repetitive tasks and let you carry out a task easily. The software lets you reconcile bank statements and even generate financial report without worrying about errors. Here are some tools that can assist you in finishing your bookkeeping task.

Cloud Computing

Cloud computing is the future of bookkeeping and it is the first thing that comes to mind when it comes to reducing bookkeeping’s turnaround time. These services provide real-time information and they can also extract key data from receipts. The details you need are published into cloud-based accounting software and can be retrieved anytime you need them. You can also provide real-time information so you can reconcile accounts. Cloud computing enables you to collaborate with accountants and bookkeepers.

Project Management Tools

Interpreting numbers and providing recommendations to key stakeholders are also the responsibilities of a bookkeeper. Technology is going to be important in this process. If your bookkeeper to prepare financial statements and reconcile accounts with ease, project management and time tracking tools are going to be necessary. These tools will enable business owners to monitor workflow and ensure that inefficiencies in the workplaces are addressed. Aside from monitoring workflow, the tools can also help business owners find out about customers who are generating the most revenue. The management can bring data together and provide details of your goods and budget. The tool will help you analyse customers by industry, geography and the products they purchased.

Bookkeeping Platform

When it comes to bookkeeping, each business need to accomplish unique goals, and using one-size-fits-all approach will never work. When choosing bookkeeping platform, it is important to choose the platform that can be customised. Platforms that enable customisation let you add new features and functionality. You can also opt for application programming interfaces that let you share pieces of software and communicate data. These abilities will help you integrate mobile payment systems, point of sale and email marketing.

These tools have features that can address your business needs and help you accomplish your business goals. Make sure you know the software that can help you reap the benefits of bookkeeping technology.

Bookkeeping Technology: Bane or Boon?

When desktop software products came to existence, many businesses today cannot imagine doing work without using them. It is due to the efficiency of these essential tools. These days, cloud technology is making huge waves by changing bookkeeping. Firms that have adopted the cloud-based technology earlier became more efficient as they have better service levels and higher margins. These advantages are used in many different ways such as accelerating growth while decreasing fees. However, you have to keep in mind that cloud technology can make or break your business depending on how you adopt to it.

How can business owners make the most out of bookkeeping technology?

Business owners want access and ease and what better way to obtain these benefits than to adopt cloud technology. Cloud-based technology makes life easier because of automating bookkeeping processes, which used to take a large chunk of your time. This means you can reduce the burden of manual tasks by carrying out the task quickly and efficiently.

More often than not, the bookkeeping process is focused on extraction and data entry. However, these tasks can be more prone to errors if they are not carefully checked. This is why replacing these tasks with automation is the way to go. Since technology requires speed, you need to act fast or you will be left behind. This does not necessarily mean that you are going to replace your bookkeeper with a microchip. You just need to have a more efficient way of taking care of your bookkeeping duties.

Technology will change the way you work and during the transition, you will play a crucial role to ensuring that the adoption will become as smooth as possible. The cloud-based bookkeeping software gathers data, which you can look at each month using a different approach. This modern approach can help improve your productivity by giving you the ability to analyse data in real time.

Aside from ensuring that frequent delays are identified, you can also prioritise tasks by urgency. You can also assign team members to the tasks that suit their skill sets. Even the cost of efficiency can be determined across a number of factors. Such positive results will also benefit practices by reducing expenses and improving productivity. Technology will become an enemy if you choose to ignore. It is important to change your way of thinking by ensuring that adoption becomes as smooth as possible. The only way you will realise the true value of bookkeeping technology is when you start embracing transformation.

The Benefits Of Cloud Bookkeeping

One of the most difficult parts of running your business is ensuring that your finances are on their feet. You try to keep track of your financial activities but you cannot get updates in real-time as there are other areas of your business you need to focus on. This is where cloud bookkeeping comes in. It has a lot of benefits to business owners such as eliminating time-consuming tasks so it becomes a problem of the past. Cloud bookkeeping has brought efficiency into every business because of its ability to automate manual tasks. As repetitive tasks are reduced, you will have more time to spend on other areas of your business. It gives you greater peace of mind knowing that you have attended to all essential areas of your business that you want to improve on.

1. Real-time financial information

Managing your cash flow is very important to your financial success as a business owner. When you manually carry out your day-to-day tasks, you miss out on having real-time insight into your finances. When you always lack timely financial information, you can surely break your business. With cloud bookkeeping, you will be able to have an auto-updated information of your company’s financial health. There is no need to wait for days to generate the information as the report can be generated in 24 hours.

2. Collaboration Becomes Easier Than Before

It is easy for bookkeepers and advisors to get the information they need when you adopt cloud solution. They can access the information whenever, wherever. As a result, collaboration is simplified and accountants and bookkeepers have greater control of their time.

3. Efficiently Assist Clients In Less Time

Automation alongside cloud bookkeeping can bring speed and efficiency into your company because it boosts your productivity. When it does not take so much of your time to support clients, more and more people will not hesitate to do business with you.

4. Updated Cloud Software Without Extra Cost

One of the best things about cloud software is that you can get updates without any extra cost. In the past, you need to purchase an update version of the software so you can continue to enjoy technology’s rapid development. Cloud software updates take place without any extra cost.

5. Easily Back Up Data

When it comes to backing your data, you often find yourself delaying the process because the process is burdensome. Since cloud integrates your data, backup becomes automatic. In fact, it becomes part of your workflow so you do not have to spend too much time on the process.

Tax Deductions Your Business Might Have Overlooked

Even in businesses, old habits die hard and when left unchecked, they can create a ripple effect on the most critical area of your business. When running your business, you need to see to it that you are sharper and smarter. The expenses you incur is often claimed as deductions. However, deductions for domestic or private expenses are not considered valid for claims. There are also some other expenses that are excluded. This is why you need to check the following as you may have overlooked them come tax time:

Prepay Expenses

Prepaying your expenses is one reason for overlooked tax deduction. Prepaying your expenses can be done to cover a time-frame, which should not exceed more than one year. The purpose of prepaying expenses is to bring forward your operating expenses before each financial year ends. Some examples of expenses you can prepay are insurance, training events, travel expenses, rent, phone and others.

Employee Deductions

Your employees’ salaries, bonuses, wages and even commissions taking place before the end of each financial year can be deducted. This can be done even if you have not physically made the payment to your staff by that date. The said payment still counts as work performed within the specified financial year despite the wages and salary not appearing in the PAYG payment summary of the employee until the next financial year.

Accounting and banking expenses

Bookkeeping, accounting and activity statement preparation are considered the most common deductions you make when running your business. Common deductions may also include marketing and general advertising costs. However, bank fees and charges are still overlooked.

Stock and Inventory

Everything counts with tax deductions and with that said it is important to check your stock and determine which ones are damaged or obsolete. Make sure you write it off or write it down because this practice will create a great impact on the trading stock’s value and your profit margins. Make sure you consider how to value your stock trading every financial year because there might be a possibility that you will be entitled to a tax deduction especially when your opening stocks have already exceeded the closing stock.

Bad Debts

Bad debts and financial loss can also be overlooked. As much as possible, you should speak to your financial advisor so you can discuss the steps you need to take to minimise the impact of the loss. Make an attempt to recover bad debts. You can also document the debt as evidence and your financial advisor can help you with the process.

It is imperative that you keep track of the tax laws and regulations as they change frequently. You can prevent issues with filing your tax claims if you aware of these changes.

4 Bookkeeping Tasks That Need To Be Automated

Although there are some businesses  embracing business automation, others are still left behind due to retaining traditional business processes such as bookkeeping. The tasks involved in bookkeeping can be long, tiring and tedious because you need to make sure that the information you enter is error-free. There are four essential bookkeeping tasks that need to be automated:

Invoicing

There are other areas of your business that you need to focus on and this can lead to losing track of the people you paid and the ones you haven’t. A bookkeeping software can get you covered because it automatically generates invoices. The bookkeeping software can prevent oversight, which usually happens when you do not monitor payments. Problems with invoicing are a serious matter because it can lead to losing money and cash flow issues.

Bookkeeping software that lets you generate invoices that you can email or print is definitely the way to go. Your bookkeeping software has an automated system that can help you sustain sufficient cash flow while you are waiting for your next payment. The software also gives you the ability to work in conjunction with your bookkeeping software so you can request corresponding funds or select an outstanding invoice for a specific period of time. Payments are also deposited into your account as early as the next day.

Payroll

Payroll taxes are often considered by small business owners as the biggest burden because of the grueling hours spent for managing payroll. Bookkeepers often spend 10 hours or more on a monthly basis for taking care of payroll taxes. In a year, bookkeepers are spending a total of 120 hours per year for this task alone. When you automate your payroll system, you can cut down your bookkeeping load and create an instant paycheck and calculate your payroll taxes.

Inventory

Taking inventory may take days but the time you spend on this bookkeeping task can be reduced when you decide on automating your inventory management. You can create sales report by integrating your inventory management with your bookkeeping software. The bookkeeping software can also help you generate invoices and reduce inventory errors.

Expense Reporting

Not submitting your expense reports is a company policy violation and these variables can also cost you money. Make sure you automate expense reporting for a streamlined bookkeeping process. With automation, you will be able to have the ability to use your mobile devices to take pictures of your receipts. You can also generate reports and integrate them with travel bookkeeping so you can keep track of your travel expenses.

Modern Bookkeeping For New Business Owners

Bookkeeping can be an entrepreneur’s pain point if there is no proper process put in place. While you can certainly resort to DIY bookkeeping, the result can be disastrous once you have lost track of the most important details that should be in your financial report. Mention the word ‘taxes’ and it will sure bring chills to any business owner. Aside from the physical pain for paying a percentage of your hard earned income, you will also have to ensure that you agree to the term and conditions so you do not trigger an audit from the ATO. There are some questions that may linger in your mind regarding taxes and not knowing how to solve them can create a negative effective on your business. This is where a modern bookkeeper comes in.

A bookkeeper will help you keep track of your expenses and identify which expenses are considered eligible for write-offs. They will also help you keep track of your income especially for payments coming in from various sources. While these tasks can be overwhelming, your bookkeeper will help you ensure that you will not be intimidated by taxes. When it comes to taking care of your taxes, you just need to take it one step at a time. First, you need to break down your income sources and break them into payments. Your bookkeeper will help you track the payment transaction as you go and track the every single expense that you incur while you operate your business. Once you have these two figures, the next thing you should do is to determine the net loss or profit of your business.

Your bookkeeper should also keep track of your working hours on a weekly basis as this can help you break down your hourly rate. Tracking these things on excel will definitely suffice, but it is also much better to track them using bookkeeping programs. When you have complicated rules, it is really easy to get overwhelmed. This is why it is best to personalise rules and simplify the process as much as possible.

You must also understand that there is no such thing as ‘one size fits all’ approach. Make sure you keep track of your taxes and do not consider a professional bookkeeper as an additional expense. Bookkeeping will no longer be a pain point of your business if you know how to make the process simple with the help of a reliable bookkeeper.

Key Lodgment And Payment Dates

time-481450_1280Have you ever shouldered late fees and penalties as you were completely unaware of the important dates for payment and lodgment? While it is quite understandable that you are busy focusing on other aspects of your business, it is also important that you know the key dates especially when it comes to paying your taxes. Many business owners have gotten themselves into trouble due to late payments. It is essential to every business owner to take note of important payment and lodgment dates to avoid penalties. Your bookkeeper should see to it that you do not miss these following dates:

July 2016

21 July

Lodge and pay June 2016 monthly activity statement.
Lodge and pay 2015–16 quarter 4 PAYG instalment activity statement for head companies of consolidated groups.

28 July

Lodge and pay quarterly activity statement for quarter 4, 2015–16 – paper.
Pay quarterly instalment notice (form R, S or T) for quarter 4, 2015–16. Lodgment is only required if you vary the instalment amount.
Employers must make super guarantee contributions for quarter 4, 2015–16 to the funds by this date.
Employers who do not pay minimum super contributions for quarter 4 by this date must pay the super guarantee charge and lodge a Superannuation guarantee charge statement – quarterly (NAT 9599) with us by 28 August 2016.

Note: The super guarantee charge is not tax deductible

31 July

Lodge TFN report for closely held trusts for TFNs quoted to a trustee by beneficiaries in quarter 4, 2015–16.
Lodge Venture capital deficit tax return for June balancers.
Lodge Franking account return for 30 June balancers when there is an amount payable.

August 2016

14 August

Lodge the PAYG withholding payment summary annual report for:
large withholders whose annual withholding is greater than $1 million
payers who have no tax agent or BAS agent involved in preparing the report.

21 August

Lodge and pay July 2016 monthly activity statement.

25 August

Lodge and pay quarterly activity statement for quarter 4, 2015–16 – tax agents and BAS agents – if you are lodging using:
electronic lodgment service (ELS)
electronic commerce interface (ECI)
Tax Agent Portal
BAS Agent Portal
practitioner lodgment service (PLS).

28 August

Lodge the Superannuation guarantee charge statement – quarterly and pay the super guarantee charge for quarter 4, 2015–16 if the employer did not pay enough contributions on time.

Employers who lodge a Superannuation guarantee charge statement – quarterly can choose to offset contributions they paid late to a fund against their super guarantee charge for the quarter. They will still have to pay the remaining super guarantee charge to us.

Note: The super guarantee charge is not tax deductible

For help working out the super guarantee charge and preparing the Superannuation guarantee charge statement – quarterly, use our Super guarantee charge statement and calculator tool.

Lodge Taxable payments annual report – building and construction industry.

September 2016

21 September

Lodge and pay August 2016 monthly activity statement.

30 September

Lodge the PAYG withholding payment summary annual report for payers whose registered agent (BAS agent or tax agent) helped prepare the report.
If a payer has only closely held payees and their tax agent helps prepare their report, they may be eligible for a concession to lodge this report by the due date of their tax return.
Lodge Annual TFN withholding report 2016 when a trustee of a closely held trust has been required to withhold amounts from payments to beneficiaries.

October 2016

21 October

Pay annual PAYG instalment notice (Form N). Lodgment is only required if you vary the instalment amount or use the rate method to calculate the instalment.
Lodge and pay quarterly PAYG instalment activity statement for quarter 1, 2016–17 for head companies of consolidated groups.
Lodge and pay September 2016 monthly activity statement.

28 October

Lodge and pay quarterly activity statement for quarter 1, 2016–17 – paper lodgments.
Pay quarterly instalment notice (form R, S, or T) for quarter 1, 2016–17. Lodgment is only required if you vary the instalment amount.
Employers must make super guarantee contributions for quarter 1, 2016–17 to the funds by this date.
Employers who do not pay minimum super contributions for quarter 1 by this date must pay the super guarantee charge and lodge a Superannuation guarantee charge statement – quarterly (NAT 9599) with us by 28 November 2016.

Note: The super guarantee charge is not tax deductible

Lodge and pay annual activity statement for TFN withholding for closely held trusts where a trustee of a closely held trust withheld amounts from payments to beneficiaries during the 2015–16 income year.

31 October

Final date to appoint a tax agent to the income tax role for any new client. If you advise us of your appointment after this date, the client’s 2016 tax return may not be covered by your lodgment program.

Note: The lodgment program is a concession to registered agents. We can ask for documents to be lodged earlier than the concessional due dates.

Lodge tax returns for all entities if one or more prior year returns were outstanding as at 30 June 2016.

Note: This means all prior year returns must be lodged, not just the immediate prior year

If all outstanding prior year returns have been lodged by 31 October 2016, the system will reset the 2016 tax return due date as in the normal program.

SMSFs in this category must lodge their complete Self-managed superannuation fund annual return by this date.

Lodge and pay Self-managed superannuation fund annual return (NAT 71226) for new registrant (taxable and non-taxable) SMSF where we have advised the SMSF the first year return will have a 31 October 2016 due date.

Lodge tax return for all entities prosecuted for non-lodgment of prior year returns and advised of a lodgment due date of 31 October 2016:

Some prosecuted clients may have been given a different lodgment due date – refer to the letter you received for the applicable due date.
Payment (if required) for individuals and trusts in this category is due as advised in their notice of assessment.
Payment (if required) for companies and super funds in this category is due on 1 December 2016.

SMSFs in this category must lodge their complete Self managed superannuation fund annual return (NAT 71226) by this date.

Lodge Annual investment income report (AIIR).

Lodge Departing Australia superannuation payments (DASP) annual report.

Lodge Franking account tax return when both of the following apply:

The return is a disclosure only (no amount payable).
The taxpayer is a 30 June balancer.

Lodge PAYG withholding annual report no ABN withholding (NAT 3448).

Lodge PAYG withholding from interest, dividend and royalty payments paid to non-residents (NAT 7187) annual report. This report advises amounts withheld from payments to foreign residents for:

interest and unfranked dividend payments that are not reported on an Annual investment income report (AIIR)
royalty payments.

Lodge PAYG withholding annual report – payments to foreign residents (NAT 12413). This report advises amounts withheld from payments to foreign residents for:

entertainment and sports activities
construction and related activities
arranging casino gaming junket activities

Lodge lost members report for the period 1 January – 30 June 2016.

Lodge TFN report for closely held trusts for TFNs quoted to a trustee by beneficiaries in quarter 1, 2016–17.

November 2016

21 November

Lodge and pay October 2016 monthly activity statement.

25 November

Lodge and pay quarterly activity statement for quarter 1, 2016–17 if you are lodging using:
electronic lodgment service (ELS)
electronic commerce interface (ECI)
Tax Agent Portal
BAS Agent Portal
practitioner lodgment service (PLS).

28 November

Lodge Superannuation guarantee charge statement – quarterly and pay the super guarantee charge for quarter 1, 2016–17, if the employer did not pay enough contributions on time.

Employers who lodge a Superannuation guarantee charge statement – quarterly can choose to offset contributions they paid late to a fund against their super guarantee charge for the quarter. They will still have to pay the remaining super guarantee charge to us.

Note: The super guarantee charge is not tax deductible

For help working out the super guarantee charge and preparing the Superannuation guarantee charge statement – quarterly, use our Super guarantee charge statement and calculator tool.

December 2016

1 December

Pay income tax for taxable large/medium taxpayers, companies and super funds. Lodgment of return is due 15 January 2017.
Pay income tax for the taxable head company of a consolidated group with a member deemed to be a large/medium taxpayer in the latest year lodged. Lodgment of return is due 15 January 2017.
Pay income tax for companies and super funds when lodgment of the tax return was due 31 October 2016.

21 December

Lodge and pay November 2016 monthly activity statement.

Source: https://www.ato.gov.au

3 Bookkeeper Mistakes To Avoid

While majority of bookkeeping tasks tends to be repetitive, it does not necessarily guarantee error-free results. When mistakes become habitual and the bookkeeper does not make a conscious effort to correct, you are about to face a more serious problem with your business.

You might have dealt with more complex transactions that require a bookkeeper’s expertise, but you only paying fees and penalties because the bookkeeper did not finish the task you assigned. As a business owner, you need to remain vigilant so you can spot the mistake before it worsens.

Business owners are expected to have basic knowledge of bookkeeping or accounting to know what is going on with the transactions. If you do not know how to manage your money, you are not far from going broke eventually. You do not have to acquire the skills of your bookkeeper or accountant to fully understand the information they dish out. As you learn the ropes, you will begin to gain a basic understanding of how bookkeeping works.

Bookkeeper Problems and the Solutions

1. Not addressing the task at hand: The problem starts when your bookkeeper is habitually taking essential tasks for granted. When the tasks are not being addressed, it can either be due to limited time or inefficiency. This can be avoided by checking with your accountant how much time they estimate should be spent on a weekly basis in order to finish the task. You will also have to provide the right resources to ensure that the job is completed successfully. Make sure your bookkeeper keeps you abreast of the unfinished tasks regularly so you will know which work has been prioritised and which ones need extra attention. Being aware of the progress of the task you assigned will help you determine if your bookkeeper needs additional hours or resources.

2. Not recording or archiving: Your bookkeeper is required to keep all your invoices and receipts for legal purposes. In theory, receipts must be filed and archived between 5 and 10 years. This enables you to support your case in case you need to sue or you are sued. If your bookkeeper keeps on forgetting about filing or archiving essential receipts, you need to create a document filing system. It will also be a great idea to go paperless so you can save office-space. Choose a bookkeeper that will give you access to the information you require especially for tax filing.

3. Not coordinating with your accountant: The task of your bookkeeper differs from the task of your accountant, but this does not mean they cannot work together. In fact, if 90% of bookkeeping tasks are repetitive, the bookkeeper should collaborate with your accountant when dealing with 10% of complex tasks.  When your bookkeeper is not coordinating with your accountant, it can result in various problems such as payroll and superannuation errors. Make sure a strong line of communication is enabled between your bookkeeper and accountant so both parties can complete tasks and prevent costly mistakes.