Bookkeeping and its importance

Posted by Digit | Bookkeepers & Business Advisors on February 19th, 2021

In earlier days, businessmen used to keep records of financial transactions of their business such as amount received and amount spent using books and ledgers. They used to physically maintain records of financial transactions in daybooks, cashbooks or journals and later transfer all the data to a ledger.

Now-a-days, tedious and monotonous task of all the physical bookkeeping has been replaced in digital form with the help of bookkeeping software that work on innovative cloud based bookkeeping technology.

Commonly performed bookkeeping activities

Maintaining records of incoming and outgoing cash or cash flow through proper bookkeeping, especially your small businesses, is not only essential but extremely beneficial for the growth of business.

Among most common and essential bookkeeping activities performed with bookkeeping software are:

• Maintaining ledgers
• Handling the accounts payable and receivables; Daily financial entries
• Daily financial entries some
• Payroll and Inventory services
• Invoice processing
• Helps in taking the decision related to the business and investment.
• Preparing the tax returns
• Account reconciliations.

Some of the daily activities performed for accounting purposes through bookkeeping in Perth include:

• Daily financial entries
• Maintaining ledger entries, Record payments and reconciliation.
• Recording of income and expenditure transactions and updating them to various accounts.
• Clearing payments
• Financial reporting
• Managing daily banking activities.
• Preparing various financial reports.

Best software for bookkeeping and accounting

Although there are many yet Xero accounting software has been regarded as the best and most acknowledged accounting software in providing bookkeeping services in Perth for small businesses.

By virtue of its performance and features, Xero bookkeeping is considered the best in the business. Its features include:

• Easy-to-understand interface
• Makes bookkeeping simple and easier
• Fully automated- when provided access to bank, it can reconcile account

In addition, it can easily manage invoicing, payroll, cash flow i.e. account receivables and payables.

Major reasons why bookkeeping is important

Business bookkeeping in Perth is important for all businesses whether small or large sized. Bookkeeping being the initial step of the accounting process that entails classifying, reporting and data analysis; it helps maintaining accurate financial records.

Accurate bookkeeping in Perth helps in:

• Maintaining accurate records of all financial transactions
• Better financial management and analysis
• Fulfils Tax Obligations
• Ease of reporting to investors
• Business planning is made easy
• Easier audits
• Proper Record Keeping as Required by Law

Basically, accurate bookkeeping accounting can help you compare your present business performance i.e. financial status to previous year, the financial records of previous year at any point in time and thus enable you to analyze your growth rate.

Keeping in view the above advantages of efficient bookkeeping in Perth, it is always better to hire professional bookkeeper for efficient bookkeeping services in Perth.

Hiring professional bookkeeper will prove fruitful as they can:

• Save your time
• Help you understand and manage your business finances more efficiently
• Help alleviate lot of stress of managing cash flow
• Ensure that your accounts are accurate and up-to-date

Engaging professional bookkeeper will help you in fixing old and neglected accounts by developing a system that can help you remain updated all the time.

In case, you need to outsource professionals for your bookkeeping in Perth, please contact Digit – the most efficient and reliable providers of bookkeeping services in Perth.