Tracking your expenses, monitoring transactions and staying up to date on the day-to-day financial health of your company’s bank account are crucial for running a smooth business.
One important and often overlooked way of monitoring your company’s financial health, saving hours during tax season and being desirable to potential investors is by bookkeeping.
Difference between bookkeeping and accounting
Accounting covers the entire sphere of information and analysis regarding your company financials. That includes everything from recording transactions and producing financial documents for investors to analyzing and reporting the financial health of an institution. Accounting is an important aspect of bookkeeping.
Bookkeeping is the process and method of tracking and recording all financial transactions related to your business. Whether you are purchasing business cards, depositing a check from a client or taking an advisor out to lunch, all of these are business transactions that should be tracked by bookkeeping.
User friendly online bookkeeping tools
There are a variety of easy-to-use accounting and bookkeeping software available online. If you’ve ever used Mint.com to organize your finances, that's an example of a free bookkeeping software for personal accounts. The same company, Intuit, created the QuickBooks software, a common businiess accounting tool used by many companies.
Ultimately, maintaining accurate and clean financial records from the start will save you time, money and hassle down the road whether you're pitching to investors or handling business taxes.