Bookkeeping is the maintaining of records of all business transactions, and is one of the ways you determine your firm’s financial health. Here are some points about bookkeeping you should know if you plan to do it yourself:

Separate the accounts

There are five kinds of accounts: assets, meaning the resources and cash held; liabilities, meaning loans taken out and other debts owed; revenue, meaning the profits generated by the business; expenditure, meaning outgoing money to meet operating costs; and equity, which refers to the value after business liabilities have been subtracted from the assets.

Your books should feature separate sections for each, with all transactions recorded in the correct section.

Creating your accounts

Accounts are created on a computer, using either Excel or cloud software, like Wave. This can be expensive to buy and if you’re not tech savvy, bookkeeping is made harder. In this situation, it is worth considering hiring a reputable small business accountant in South Yorkshire or whatever region your business is in.

Single or double-entry

If you are going it alone, it will be necessary to decide between the single or double-entry methods. The former involves recording each transaction once, while the latter sees transactions recorded twice: as a debit and again as a credit. This is the more standard method, but it will also be more complex for the non-professional.

At Adaptive Accountancy, we have been helping small firms manage their accounts since 2011. Give us a call today and see how we can help you.