Keeping track of your company’s finances meticulously is crucial to achieving your goals and for tax purposes. However, we understand that this may be a daunting process, especially for first-time entrepreneurs. Hence, we have prepared these 5 accounting tips to help you stay on top of your company’s finances.
1. Have a sound bookkeeping process
Every company in Singapore has to submit an annual report to the Accounting and Corporate Regulatory Authority (ACRA) and file taxes with the Inland Revenue Authority of Singapore (IRA). Hence, it is important to keep track of all financial transactions of the company. This should start from day 1 of running the business and not left till when the tax period is approaching.
With so many transactions, you need a systematic process for bookkeeping. This helps to keep things neat and organised. The bookkeeper should also be familiar with the law and provisions given in the Singapore Financial Reporting Standards (SFRS).
2. Keep all your business expenses separate
Keep your business expenses separate from your personal expenses. This not only makes it easier when filing reports and tax, but also makes it easier for you to track the financial health and goals of your company.
A business credit card can be a good way to separate your expenses. Everything is recorded systematically under the credit card for easy tracking. Click here for our guide on which bank to choose to open your business account.
3. Keep track of EVERYTHING
This can’t be stressed enough and tends to be overlooked by first-time entrepreneurs. Small expenses here and there such as a cab ride to meet clients, will snowball overtime and build up into a significant amount. If not tracked dilligently, this will cause discrepancies and lots of headaches when filing annual reports and taxes.
4. Forecast upcoming major expenses
As the business owner, you should be the one most familiar with the financials of the business and the first to know of any large expense in the foreseeable future. Such forecasting will help you avoid running into short-term cashflow problems and help achieve your business goals. One of the major ‘expense’ for companies would be taxes. Get yourself familiar with the tax rates and start forecasting early.
5. Invest in an accounting software
An accounting software can help you do your invoicing, bookkeeping and billing. It makes your business run more smoothly and reduce human errors that you get from doing these tasks manually. Besides, its just easier and more convenient. Many of them are also cloud-based so you can run your business and check your finances anywhere, anytime.
If you are going to hire a professional accountant/ bookkeeper for your company, check out our reviews on some of the top firms in Singapore here.