When it comes to managing and operating your finances you will need to work out the best process for keeping and filing your records. One of the main things to decide will be whether you do the bookkeeping yourself, hire a bookkeeper or pay an accountant to do them for you. We have pulled together the guidance below to help you understand make a decision on how to manage your finances, however this is only a guide and you should seek professional help to ensure you make the right decision for your business.
Video: Keeping records up to date
Do It Yourself
If you are a sole trader or a small business with only one or two staff, you may wish to do your own bookkeeping (i.e.., keep your own accurate records of income and expenditure). If this is the choice you make, you will need to keep your cash receipts and invoices for all income and expenditure such as utility bills and bank statements, cheque book stubs and paying in books; payroll records and VAT records if you are VAT registered.
However, if you do decide to 'do it yourself' you must ensure that you have the time and the knowledge to maintain the required information.
Hire a Bookkeeper
If you are a small businesses and you don't feel confident that you can maintain the correct accounting records, you may wish to find a qualified book keeper or accountant to do it for you. Although you will need to pay for this, you may find that in the long run, the cost is less than if you try to do it yourself.
To find a book keeper you can visit the Institute of Certified Bookkeepers or the International Association of Bookkeepers
Hire an Accountant
The bigger, more complex and potentially high growth the business, the more advisable it is to hire the services of a professional accountant from the start. If you are businesses with a turnover of £60,000+ then annual accounting costs should not be much more than £100 per month (source: Marketing Donut July 2013).
An accountant can help with PAYE, VAT, Personal Tax, Year End Accounts and Returns,
In the UK, the most recognised qualifications are from the Institute of Chartered Accountants in England and Wales (ICAEW), the Association of Chartered Certified Accountants (ACCA) or the Institute of Financial Accountants (IFA).