Financial Record Keeping: The First Pillar of Financial Success
We all agree that any strong structure needs a solid foundation to prevent it from collapsing. This foundation is the foundation or should I say it is necessary for a structure to withstand the earthly elements and last for a while. Well, it’s the same in business. Your business needs to have a solid foundation to make sure that everything you’ve worked so hard for doesn’t fall apart. You can’t get so caught up in the hustle and bustle of your business that you don’t take the time to track and monitor the metrics in your business.
In my opinion, there are four basic pillars that your company must have to stand the test of time. If these four pillars are present, your business will have a strong and solid foundation. If you remove one or two of the pillars, the structure of your business will become unstable, begin to shake, and eventually fall apart.
These four pillars not only help you lay the foundation of your business or fill in the cracks within your established business foundation, they will also help you increase your bottom line.
I’m going to share these pillars with you one by one over the next four weeks and also explain how you can implement each pillar into your daily back office processes.
The first pillar is Financial Registry mantenance. This pillar focuses on bookkeeping and accounting services, tracking your inputs and outputs, reports. It is important that you constantly keep track of the numbers in your business. It’s the only way to really know what’s going on in your business. You have to know your numbers before you can increase your numbers.
Financial record keeping requires constant recording and tracking of cash in and out of your business. Financial record keeping isn’t about keeping all your bills, statements, and receipts in a box or folder in the corner of your office, never to be seen again.
Today’s cloud accounting software has made it very easy to keep your records. You can connect your bank account directly to your accounting software so you no longer have to enter each transaction. Once your account is connected, it will download all the transactions that settled the night before and place them in a “holding chamber” until you are ready to review and post them. That’s right, no more data entry.
To do this consistently, you can develop a step-by-step process, document it, and follow it to the letter, or train an employee to do it. You can also hire a professional bookkeeper or accounting practice to help you set up and implement this process.
Keeping on top of your daily records will help you find money leaks in your business and, over time, reduce costs and increase revenue.
