There are countless small and medium-sized spa businesses that do not have effective bookkeeping services in place. While it may not sound like the worst business decision in the world, it is a very easy way to lose countless dollars and pay the wrong amount of taxes. Having an effective bookkeeping system in place is essential for the business owner to be able to effectively maintain their spa business and make the most informed decision where the financial status of the business is concerned.
One of the most important aspects of creating a good system is to invest in a quality bookkeeping software that will take care of the businesses needs.
In addition, all financial records need to be organized and kept in an organized system. It is important to have accounting experience or hire someone with this experience to analyze the reports on a regular basis. Backups should be created on a regular basis of all the reports as well as entered into a business ledger. Many believe that creating a bookkeeping system is hard work and that professional needs to be hired either on a part-time or full-time basis. However, that is not always the case.
Before you invest in a particular bookkeeping system it is important to do some initial research as you might not need all the bells and whistles.
Some of the traditional software for bookkeeping includes Intuit Quick Books, Sage Peachtree, Microsoft Money, and Sage Simply Accounting If you already have the software you can use Microsoft Excel for your bookkeeping, yet you will need to have a good knowledge of the software and basic accounting principles. You will also need to really learn all the features as it does contain a steep learning curve. However, there are many online tutorials and courses available that will teach you to use Excel as a pro. At the beginning, it is wise to set aside a bookkeeping budget of up to $700 for software alone. Of course, this is for the high-end systems, you may not need something with so many functions.
Many of the software systems on the market will guide you through the entire process of setting up your very first bookkeeping system. All you have to do is install them and follow the onscreen prompts and it is quite painless. Many times the system will install itself and requires little intervention of your own. All that is typically required is to create a new file and follow the steps as they are shown.
The next stage of your bookkeeping setup is to ensure you keep copies of all business receipts, statements, and checks as these will always need to be entered into the system to keep an accurate picture of the business needs.
Create a unique system where everything has its own specific place in the system. You always have to have accurate numbers and can never make a guess, that is a direct violation of the first Accounting Principal. When you just take a guess at overall expenses your figures are going to end up inaccurate and you will find it hard to maintain a business. Anyone who has a background in accounting knows the dangers in this practice and would never recommend it to anyone.
However, it is not necessary to have any accounting knowledge. Although, if you are going to run the office on your own it would be beneficial to learn the basics. This includes knowing what revenues, assets, liabilities, expenses, and equity are. This will give you a good boost in running the bookkeeping in your office. There are actually many online courses that offer up some of the basic accounting lessons one needs for free or low cost. This will help you get all those numbers into the right lines and spots and not make elementary mistakes. When you are able to analyze the overview of the business it gives you the ability to decrease and increase expenses at a moments notice to ensure the company is moving in the direction
Backups are an absolute must in the accounting world and that can not be stressed highly enough.
You never know when valuable data is going to be lost. Having backups available means you never have to worry about the system going down or an accidental data wipe. You can save all your information to the cloud, external hard drive or a CD. It is best to be over-protective of your data and keep multiple copies in various locations. Trust us when we tell you, that you will be glad you did.
Once your system has been created and is running perfectly, you have to ensure that you are regularly entering new information. This can be done daily or on a weekly basis. Do not let this work pile up as it will happen fast and then you will find yourself trying to play catch up and this is when costly mistakes happen.
When it comes to money and your business, you do not want any mistakes!