Why do figures and “The Books”make some people worry?
I think it is possibly to do with the fact, that it has a lot of ramifications if the figures are not right.
So I suggest that you take a couple of minutes to compose yourself, and then start at step 1.
You have a couple of questions to ask yourself, such as will I be doing the books myself. If I wish to have someone to do them for me, how can I save money?
Actually doing your accounts can be a very calming process, as long as you take it step by step.
1. Firstly sort all your documentation into date order; doing this will make things much more
accessible to you when needing to find a document’s. I suggest that you keep it in a month
by month order.
2. If you can do a basic payments cashbook, state: Date, name of company purchased from, and what the item will be used for. Cost excluding VAT, VAT and then Total Cost as in diagram below.
example
Date 18/07/2006
Supplier The Steel Company
Description Steel purchase
Amt Exc’g VAT 100.00
VAT 17.50
Total 117.50
Ledger stock
3. Do this for receipts as well.
Once this has all been done it would be very easy for an outsourced company to compile some basic accounts for you. Producing you a Profit/Loss. Because of the amount of work already done by you, it would cost considerably less than if you handed a box of receipts/invoices to your Accountant, not sorted.
The reason for doing above sheet (preferably typed) would alleviate the accountant contracting you to ask: What this was for? Who did you buy it from? How much? In case he can’t read your writing. That in it self could take many hours of cost per hour.
Once you have been given your P&L (Profit& Loss). Read it till you understand where all your cost is. It’s like reading a book; the figures will tell you a story. Knowing this you will be able to run your business more effectively .By cutting out unnecessary costs.
I hope enjoyed reading this short extract; I do suggest you allow a professional accountant/bookkeeper do your books. That way you will be able to concentrate on the important things making your business more profitable.
Regards Lorraine Bates
http://www.das-accounting.com
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