Confessions of a down-to-earth, totally normal bookkeeper

Part 1: On Record-keeping and staying out of trouble.

As an entrepreneur are you tying yourself in knots over not knowing how to “do the books.”? I bet between; bookkeeping, record-keeping, and running your business, you’re confused, tired and overwhelmed. Would you like to know something I’ve learned – the hard way?

Here’s the thing:

Bookkeeping is a learned skill (in fact, as a certified bookkeeper I went to school for years to learn it).

And while it’s noble to want to take care of every aspect of your business, it’s okay to not know how to prepare a perfect set of books. What, Charyl, does that mean? I’m giving you permission to stop beating yourself up over not knowing how to perform an advanced skill.

Every entrepreneur must, in some way, participate in their own record-keeping. Because of this, I’ve created a list of your must-haves to ensure ease for you and your business.

Records should be kept consistently. Records are the documents you use to support your claims, not only for eligible tax deductions but also for refunds, warranties and expense claims. By law, you are required to keep proper records of your business activities for up to 6 years following the date you filed your taxes.

You need (read: necessity, not a nice-to-have), to keep track of all of your sales, receipts, bills, statements and government notices. Tracking doesn’t need to be fancy or require some state of the art technology, so stop overthinking it and, if you have not already, create your filing system now (NOW)!

I have seen methods six ways from Sunday on how to “best” organize your paper but none of that matters if you cannot commit to actually doing it. How we organize ourselves is mostly a matter of preference and personality type. What works exceptionally well for me might be too regimented for you (no judgement).

The good news? There is no right answer for everyone, but you can create a system that works best for you.

 If your learning style is:

Visual: You love to see and observe. Your best system will include lots of pictures or could be colour coded. Creating a mind map of how you would like to stay on top of tasks will help you orient yourself.

Auditory: Your preference is to learn by listening. You may find it easier to commit to your record-keeping by putting the task to rhythm. Try creating an awesome playlist to tune into while you work.

Verbal: You prefer language, both written and spoken. Try creating mnemonics to help you stay organized. Create stories or rhymes on where and why you are filing your documents.

Kinesthetic: You favour the physical experience, something you can touch and feel. As old fashioned as it may sound, sticking to a paper-based system is probably in your best interest. If that makes you uncomfortable, repetitive mouse clicks and keyboard keys clicking will help hold your attention, so go with something via your computer (but always make sure you back up the information).

Logical: You have a strong preference for systems and procedures. You, my friend, are made for this work and are most likely so naturally organized you don’t need someone such as myself to give you any tips at all (now’s the time to get back to work).

Record-keeping is like the ugly step-sister of the accounting cycle. It’s not a formally recognized step yet still necessary, though only implied somewhere between step 1, the transaction, and step 2, journal entry.  you can’t have the journal entry without the transaction and yet the transaction must have a physical record referenced somewhere when creating the entry.

Keeping accurate records is just as crucial as actually entering the data correctly. So while not understanding the intricacies of double-entry accounting is completely forgivable, not making the effort to keep up with your record-keeping is something every business owner should invest in figuring out.

Got questions? Leave them in the comments below.

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