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 in running your business smoothly.
One incredibly important and often overlooked aspect of monitoring your company’s financial health, saving hours during tax season, and looking better to potential investors is the process of Book Keeping.
Difference between Book Keeping & Accounting
Fundamentally, accounting is the entire sphere of information and analysis regarding your company financials that includes everything from recording transactions to analyzing and interpreting the financial health of an institution and producing financial documents for investors. Accounting includes Book Keeping as an aspect of the process.
Book Keeping, then, is simply 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 – these are all business transactions and should be tracked in the book keeping process.
Fortunately, there are many versions of accounting and book keeping software available in the world. If you’ve ever used Mint, that is a free version of book keeping software often used for personal accounts. The same company, Intuit, produces the quickbooks software – a well known tool used in many businesses.
Ultimately, maintaining accurate and clean records from the start will save you time, money, and headaches down the road, whether you’re pitching to investors who want to see your financials or handling your business taxes.