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Internal Financial Control Best Practice for Your Small Business

by Samuel Williamson

2 min read

When you’re a small business owner, every dollar counts – and every dollar must be accounted for.

You work hard to ensure your business operates smoothly and profitably, and smart maintenance of your finances is an essential step towards success. Here are the dos and don’ts. 

DON’T take shortcuts

Your business is your livelihood and its financials are your bread and butter. Data should be entered promptly and accurately – leaving facts and figures to memory is unreliable and risky.

Being vigilant from the start will save you from trouble and frustrations down the line.

DON’T fall behind on inventory or payments

Always review stock balances and reconcile debtors, GST and fixed assets at regular intervals. Keeping timely accounts will ensure your business remains in good standing and that you aren’t penalised for late payments or noncompliance.

Your business isn’t the place to chance your luck or neglect your responsibilities.

DON’T mix personal and business assets

Some things just don’t mix well – like your personal and business finances. And that includes cash. Keep a clear boundary to avoid complexity managing your business finances.

If it’s not clear where money came from, or if it was spent for personal or business use, accurate accounting and effective budgeting is nearly impossible.

DO: complete strategic financial tasks

Always know where you stand – and how you will achieve your business goals.

Updating targets for overarching financial performance, reviewing performance against budget, matching sources and use of funds, and preparing profit and loss reports are all tasks that will keep you informed and – most importantly – on track.

DO: make smart investments

Whether big or small, you will need to invest in your business in order to see it grow. It’s up to you to ensure those investments help your company flourish.

Improve efficiency by going digital, increase productivity by renovating your workplace and make better products by buying better quality materials.

Whatever steps you take, do your research to make sure they are worthwhile. Always carefully consider what you need and always buy strategically.

DO: improve your understanding of your small business finances

If you’re a small business owner who wants to take charge of your finances, the first step is understanding them – even if you’re allergic to numbers.

Do your homework, use intuitive accounting software and speak to relevant professionals. A smart businessperson is an informed businessperson.

The financial realm can be tricky to navigate, but keeping on top of best practice will help you stay on track.

To help stay on top of your small business accounting, try QuickBooks Online today!

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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