Small business owners In Australia are spoilt for choice when it comes to bookkeeping software options. However, MYOB remains one of the most popular options across the country and it has survived the test of time, after being introduced to Australia back in the 1990s.
Whether you have a sole trader, partnership, or company structure for your small business, effective bookkeeping is a must to keep your business on track (and the ATO on your side!).
In this blog, we will explore small business bookkeeping and how MYOB accounting software can help you effectively manage the books for your business.
How To Do Small Business Bookkeeping in Australia?
At the heart of bookkeeping is the tracking and organisation of your business finances.
Before your bookkeeping journey begins, you will need to create a chart of accounts that categorises your income and expenses.
Using a cloud accounting software solution, such as a subscription to MYOB business software can make this process easier for small businesses because they provide a standard chart of accounts that you can then edit (if necessary) to suit your business.
It is important, in your small business bookkeeping, that you accurately record your income and expenses. Software such as MYOB makes this process much easier with the ability to upload photographed receipts quickly and easily into your financial management system.
Small business owners should also reconcile accounts regularly to check they are correct against their bank statements.
Accuracy is important for two main reasons:
- You need to have quality data in your bookkeeping system to create accurate financial reports – and you need accurate financial reports to make informed decisions about your business.
- You need accurate information to meet your reporting and compliance obligations (for example, Business Activity Statement lodgements, PAYG lodgements, annual tax returns, and/or mandatory financial reporting for Australian companies.
Bookkeeping also requires you to keep all records relating to transactions in your business.
This includes important information about your debtors and creditors, inventory (if applicable to your particular business), customers and suppliers.
Bookkeeping Options For Small Businesses
There are two main decisions to make as a small business when deciding how you will manage your bookkeeping:
DECISION #1:
Will you use bookkeeping software or more manual options, such as spreadsheets?
Which method you choose will depend on the size of your business and how many transactions you need to keep track of each month. Spreadsheets do have limited capabilities, however, and you will likely need to allocate some extra time to manage your bookkeeping if not using cloud-based software.
One of the key advantages of accounting software, such as MYOB, is that all of your financial records will be in one place.
You can create branded invoices to collect payments, record expenses, add receipts, track your inventory, and run a range of financial reports that can help you manage your business finances and cash flow effectively. MYOB also provides the ability to track jobs and manage multiple currencies.
DECISION #2:
Will you DIY your bookkeeping or will you outsource to a trained and experienced professional bookkeeper?
Many small business owners begin with a DIY approach. However, as your business grows, so does the complexity of your bookkeeping.
Managing more transactions means you will likely need to dedicate more time to your bookkeeping, taking time away from your core business.
Often, at this point in time, a small business owner will make a decisive shift from a DIY approach to outsourcing to a MYOB bookkeeping service.
Understanding the Costs of Small Business Bookkeeping
There are costs associated with bookkeeping whether you do it yourself or outsource to a professional. If you do it yourself, there is an economic cost (i.e. the value of your time) and an opportunity cost (that is the potential benefit lost because you are doing your books instead of something else important within your small business).
When you engage a professional MYOB bookkeeper, they may offer an hourly rate or fixed fee arrangement. Monthly or annual packages are also common.
As a small business owner, you will have to weigh up the costs of each option and determine which will work best for your circumstances.
Find a MYOB Small Business Bookkeeper to Help With Your Business
If you want to focus on your strengths and your core business while outsourcing your bookkeeping to a trained professional, contact First Class Accounts.
As a well-known partner for small businesses in bookkeeping, as well as tax and payroll advice, you can be confident you will be in safe hands with our team.
To find a First Class Accounts MYOB bookkeeper near you, click here.
