Knowledge Base

Accounting & Bookkeeping is the practice of recording incoming and outgoing cash, or cash flow, in your small business. This system involves recording all financial transactions in your business, including expenses such as materials, services, and payroll, as well as income, like customer or client payments for goods and services.

Previously, bookkeeping was a tedious and monotonous task that involved physically recording all transactions. Thanks to new cloud-based technology, bookkeeping is now a simpler process that won’t require hours of your time come tax season. Outsourcing bookkeeping to an online bookkeeper is also a cost-effective alternative to hiring an in-house bookkeeper for businesses of all sizes.

What is The Importance of Accounting & Bookkeeping?

Accounting & Bookkeeping are an essential function in your business for both legal and financial management purposes.

By keeping accurate records, your business can get a snapshot of its health in the form of financial statements such as income statements, balance sheets, cash flow statements and more. While bookkeeping concepts deal with recording this financial data, accountants organize and analyze it, often providing recommendations to ensure accuracy and improve spending.

The importance of bookkeeping extends beyond simply staying organized. Additionally, diligently tracking all incoming and outgoing expenses can help you strategize for the future.

Proper bookkeeping practices also helps you respond to potential IRS inquiries or audits.