Having an accountant to help you manage your finances is a welcome development to any business owner. However, if you don’t keep track of your expenses and financial records, you’re sure to make an enemy out of an accountant. To make both your lives easier, you might want to follow these tips.
Don’t assume too much
Some people assume to know a lot about accounting, whether it’s in the oil and gas industry, manufacturing, retail sector, or food industry, that they think they’ve already figured out what tasks to give to their accountant. They just hand the receipts, financial records, and other relevant materials without even discussing the financial health of the company.
What you should do instead is ask your accountant everything about the job so that you’ll have a clearer view on how to help each other. You may have some misconceptions about filing for a tax break, for example, so this is the perfect time to clear up all your confusions. Ask about receivables and how to organize them. Ask about tax deductibles.
Encourage your accountant to ask you several questions about your company, as well. An accountant needs to know the ins and outs of a business so that they can figure out which company expenses are justifiable and which ones you should get rid of.
Don’t mix business and personal expenses
You may have a habit of paying off personal expenses with your business accounts and vice versa. If so, stop immediately because you’re going to give your accountant a headache.
Instead, set up separate accounts for your personal and business expenses. Have a checking account for your business deposits and withdrawals in order to manage your expenses better. Also, use a credit card for any purchase for your company.
On the other hand, have a personal account for any expenses outside the company. This means that you will use this account to pay for your bills at home and non-business related dinners or lunches.
Store your receipts
While you’re building your company, you’ve been purchasing a lot of items for your office and you’ve probably been taking your clients out to lunch or dinner. Whatever your expenses were from the start of your business until now, you should keep all the receipts and hand them over to your accountant.
It will be easier for your accountant to track down all your expenses, if you stored all your receipts. So, invest in a file cabinet or any storage where you can place all of them. File them properly because you wouldn’t want your accountant to sigh in frustration when they just see a pile of receipts.
File your receipts by date so that your accountant can backtrack on your expenses more effectively. Another thing you can do with is to go digital. Take a picture of your receipts and file them in an expense-tracking app.
These are just some of the things you can do to help your accountant with their work. Organize your records and never lose a receipt, and eventually, you and your accountant will be the best of friends.