Getting into a new business and establishing a startup can be overwhelming, right?🙃
But if you want your startup to turn into a well-established business, It is essential to have a solid accounting foundation for any startup. Accounting for startups involves processes like
- Cash flow management
- Account receivable and accounts payable management
- Payroll management
- Filing taxes
- Purchase management
- Finance management
Umm yes!!😅 This sounds like a lot of work, but it is important to keep your accounting well organized.
- It helps you get funded.💰
- Clear records and well-organized accounting helps you get loans easily.
- It also helps you with the long-term vision for your startup.
- You can plan better for your startup by analyzing financial records.
As a startup owner, having a tight budget can be the concern and obviously, you do not want to spend so much money on accounting in the early stage of your startup.⏳
Do not Worry! If you know basic accounting, you can do it all by yourself😎. Here is the guide to accounting for startups to help you get started.
Accounting for Startups: Beginner’s Guide
As a startup owner, you need to focus on some basic tasks to keep your business on track. Let’s get into them one by one.
Accounting and bookkeeping are not the same⚠️
Bookkeeping is a process of recording all your financial transactions and activities on a daily basis. It is better to have records of all your activities in case any misleading stuff happens.
Let’s say if your balance sheet does not match then you can look back into your financial records and check where things went wrong.🔎
Generally, Businesses or accounting firms hire a bookkeeper. As you are doing all these by yourself you have two options:
- You can do it by manual entries.
- You can use accounting automation software to get things done for you.
As a startup owner, you probably don’t have time for doing manual bookkeeping every day.
So we suggest you invest in an automated bookkeeping software which will keep all your financial records in ledgers.
- Saves time⌛
- Error-free entries💯
- One can focus on other important things🧐
2. Cash Flow Management
Do you know that 80% of small businesses collapsed because of cash flow problems?🤯 (Sources)
In order to keep your business running, it is important to have positive cash flow. If your startup does not have enough cash for your next purchases or upcoming bills…How will you manage to pay the outgoings of your business?🙄
Maintain the accounts payable and accounts receivable dates. Take follow ups from your clients to get paid on time.
Manual ways of managing accounts payable and receivable can be a tedious process, as you have to manage bills, receipts, bank statements and many more.
Automating your accounts payable and receivable will help you improve your cash flow, so you never run out of cash!💸
3. Payroll Management
If your employees don’t get paid on time, they might lose the motivation to work for your startup.
It is not just about that, paying on time and paying it correctly are two things to consider.😬
Having a bad payroll management system will lead you to so many problems such as
- Not able to pay on time
- Wrong amount of tax deduction from the salary
- Can loose the records of payment history
So it is better to start payroll management with accounting automation for your startup. Automation will make accounting easier.😄
In the accounting automation software,
- You can fix dates on when you want to pay salaries
- Can set formulas for tax deduction
- You will be able to manage all the pay-slips in one place.
4. Finance Management
When you choose to do your accounting for startup, you need to be prepared for short and long term hurdles and objectives.👀
Keeping an eye on all the financial activities of your startup will help you get an idea about where exactly you need to improve? What things are you missing? What is your business’ Net profit/loss? Etc.
When you want to do it manually, This process will look like:
- Gather all the payment receipts, slips, bank statements, purchase/sales bills
- Go through them one by one
- Analyze all the activities
- Decide on one final report to state.
Seems like a lot of work and stress.🤯
What if i tell you that one can do it by nothing, and manage finances by just looking at your screen.😌
Yes, I’m talking about Accounting automation software. Accounting automation will keep track of all your activities and built-in CRM will give you auto-generated financial reports over a specific period of time. Analyze these reports and plan accordingly.
Accounting for startups can seem very hard when you choose to do it manually. Accounting automation is the best possible solution when you choose to do accounting for your business by yourself.
It saves your time, money and effort!🎉
If you are in just the starting phase of your business, we strongly recommend that you should do accounting by yourself with accounting automation software.
- When you do accounting by yourself, you have a clear picture of what is going on with your business.
- It will also help you find the problems so that you can work on those problems.
- Auto generated reports will help you plan accordingly.
- It will help you reduce the stress of all the clerical work, so you can focus on other important things.
Why Choose Suvit As Your Accounting Automation Software?
- 100% data accuracy.
- Scan any file type such as PDFs, Scanned PDFs, .XLSs and find your data entries done in tally.
- It cuts out all the paperwork.
- In-built client modules will help you and your clients well-informed about the work updates.
- Suvit is a cloud based software. Keep all your data safe at one place.
- Suvit will provide a dashboard on the homepage, which will display analyzed reports of many financial activities.
- Upload your bank statements and reconcile them with the help of automation.
If you are looking for an accounting partner, then Suvit is the one for you!
To avail the mentioned benefits, Signup Here!
(No Credit Card Required)
We are providing 7-day free trials, in case you want to join accounting automation!