You'll find that one of the most important parts of running a business is also one of the most boring. It's keeping proper records. You have no idea how important it is to be able to pull out the right information at the right time. Many of the challenges that you're going to face in terms of keeping your business moving forward and keeping your taxes, finances, staff, policies and information in order will stem from the way you save your information. At its most basic, this is going to mean having processes in place that ensure you keep the important records, receipts and files safely stored away.
Accountants have seen it all. It's a long running joke, but there's always clients and businesses who will come to you at tax time with records that are wildly out of control. There are receipts they found stashed in the bottom of a cupboard, notes scribbled on napkins, and my personal favourite - big black rubbish bags full of papers that could cover anything from their purchases, their expenses and their scrap paper that's been misfiled!
When we get these kinds of records, it's incredibly time consuming to sort through them, but it's also a little dangerous. Without knowing whether we have access to all the information we need, and without being able to tell how accurate it is, we can't guarantee that you'll have the outcome you want. It's the same with everything else, not just your taxes - your clients are going to ask for information, your staff are going to want to know things and your auditors will eventually have to look at your files. If you don't have systems in place that can make this simple, you're going to be wasting time and dealing with the difficult challenge of sorting out documentation that hasn't been organised for years!
The good news is, in 2016, getting your records right doesn't have to be a major burden. Using the right technology, you really can turn it into a smooth system that takes almost no time at all to keep running. For example, we've been encouraging some of our clients to move into mobile and online record keeping. Today, they're able to snap a photo of every receipt on their smartphone, send it to Xero, and have it in our hands in a matter of a few seconds. Other clients have started using platforms such as Evernote to scan all the documents they require and keep everything in an easily searchable channel. The beauty of many platforms like that is they let you search for text inside images and PDFS right from their document search functions.
Rather than wasting time looking for files and information that you aren't sure you even have, you can just go right into your digital storage and pull out everything, no fuss and no dramas. It's a time saver for you, and a life saver for your business. These ways of keeping records don't have to be expensive - they can be as cheap as just $5 a year, money you'll save in hourly rates and fees when you need information to be retrieved in the future!
Plus, if you keep your records tidy and ready at all times, you'll keep in the taxman's good books - and that's worth a lot on its own!