Record Keeping Tips For Australian Small Businesses

Online, August 8, 2012 (Newswire.com) - When it comes to describing family businesses, the term 'small business' is frequently used. However, in reality, most family businesses more accurately fall into a category described as 'micro businesses'. The Australian Bureau of Statistics defines micro businesses as those employing less than 5 people, whilst those which employ between 5 to 20 people are categorised by the ABS as small businesses. Consequentially, when comparing factors such as turnover, resources and funding, the distinction between small and micro businesses can be considerably vast.

Products and services marketed to small businesses may sometimes be unsuitable for smaller micro businesses. A common example of such a scenario is that of record keeping systems. Many accountants often see micro business entrepreneurs buying an off-the-shelf accounting package from a department store without having any knowledge of how to maintain a set of accounts - ultimately to abandon the system within a few months.

Such software packages can be a fantastic tool for small business operators if:
- firstly they are set-up by a professional to match the business accounts; and
- they are suitable to the businesses' requirements.

For many micro businesses, the proprietors seldom have the time or need to prepare and access the detailed business management planning tools and reporting that the popular accounting packages offer. If all that is required is a record keeping tool for tracking cash receipts and payments - there are much cheaper and more efficient options available.

Here are a few record keeping methods for micro businesses looking to cut costs:

A PAPER NOTEBOOK & A PENCIL/PEN
For many micro businesses, this can be an efficient and accurate way to keep your business records. If done well, it can assist the efficiency of your accountants also.

The key to getting it done right is accuracy and detail.
- The right date to account for the reporting method (i.e. cash or accruals)
- The details for each payment/receipt (i.e. income or expense category)
- The accurate amount of tax levied on each category (e.g. GST or other excise)

The important point here is to speak to the accountant and ask them for their opinion. Most accountants welcome such inquiries and would be happy to tell clients how to format and present financial information to reduce unnecessary work.

A COMPUTER SPREADSHEET
For those with more computer savvy, a computer spreadsheet is the perfect option. It makes it easier to tally totals, calculate taxes and correct mistakes.

Most technofiles already have spreadsheet software installed on smartphones, laptop, and home computers, but for those without a commercial software package - there are many free options available, such as:

- Windows Live
- Google Docs
- Open Office

Again, it is important to talk to the accountant regarding how the information should be formatted and presented. Most accountants welcome such inquiries.

A CASHBOOK SOFTWARE APPLICATION
For those that prefer slightly more reporting capabilities, a cashbook software package may be the right option. There are literally hundreds of these types of packages available, ranging from macro-enabled computer spreadsheets to scaled down versions of the brand-name business management software packages. An important factor in choosing an application is to ensure that data can be transferred/interfaced with the Accountant's software. In most cases, to get the best benefit out of many software applications, it pays to have the accountant set it up initially.