Factors To Consider When Evaluating Your Small Business’s Financial Health – (Infographics)

               There are many factors when it comes to keeping track of a small business’s financial health. Bookkeepers are primarily responsible for recording every transaction during business hours. By recording these transactions, a bookkeeper can help a company to prevent fraudulent activities and manage its finances properly. But what are the things that bookkeepers and business owners need to consider when evaluation time comes for the company? Here are some of them:

Balance Sheets
Small businesses typically hire several bookkeepers to help maintain their records especially the balance sheets. It contains records such as assets, liabilities, debts, and equity; this helps small businesses keep their books ready for auditing by independent accountants or the government whenever they become necessary.

Income Statements and Expenses
Nowadays, bookkeepers record expenses, income, and sales in daily, monthly, quarterly, or yearly reports use free accounting software for small business to help a company understand its costs and finances better, which in turn facilitates budgeting. Aside from this, they also play an essential role in maintaining the accuracy of tax records. To compile these records, however, bookkeepers must have access to relevant information. They must be able to acquire this information quickly and efficiently.

Accounts Receivable and Payable
Companies provide their bookkeepers with the best bookkeeping app to enhance their performance. For instance, some companies have installed computers, which allow them to store data faster and more efficiently. Computers also make accounts receivable and payable transactions more accessible, as they eliminate the need to enter the data physically. With the help of computerized transactions, bookkeepers can also create reports and track payments made. By combining all these functions, bookkeepers can create accurate reports and record-keeping, which enable them to maximize their profit and minimize losses.

Therefore, to prevent any form of fraudulence, bookkeepers must always be strictly observant of all activities and report any discrepancies immediately for a thorough evaluation once documents and information are needed.

In maintaining the accuracy of accounting records, it is important to compile and maintain client lists, which enable them to serve their clients better. They also keep inventory and purchase documents, which further facilitate accounting operations. To top it all off, bookkeepers also prepare financial reports for their employers, used in decision-making, investment, and business planning.

If you want to know more about all the factors you must consider, you can check this infographic from KIPPIN.

Factors to Consider When Evaluating Your Small Business