How to Transition Your ‘Shoebox’ Files Into a Perfect Bookkeeping System
It may feel like transitioning your files from their current state to a new, perfect bookkeeping system – one that will save you time and money – is too much of a hurdle. Here’s how you can overcome.
One of the costs of running a business is the responsibility of establishing an effective internal bookkeeping system. As a bonus, once you do, you’ll feel more control over your business, have less stress and better profitability.
But, before you just grab any old bookkeeping software and hope for the best, keep the following tips in mind.
Tip #1: An ounce of preparation is worth a pound of cure
There are hundreds of different bookkeeping systems out there. Don’t just pick one because it has a high rating, or because you’ve heard other businesses use it, and hope it will be exactly what you need. Perform your due diligence and check to see which systems will work best for you and your specific business needs. This may take some time, but don’t get discouraged. This is a major transition, and you want to be sure you adopt a system that will stay with you for a long time.
Here are a few things that should be on your checklist before proceeding:
- A list of business problems you want to fix with your new system, e.g. reducing time spent on tasks, automation of tasks, etc.
- What benefits do you want get from the new bookkeeping system? Rate in order of importance.
- Internally, who has access to what information?
- Who is responsible for the implementation? Is this person adequately supported to achieve your goals?
- When do you want the changeover to happen?
- How are you going to train your staff (and yourself) on the changes?
Tip #2: Remember that software is not a quick-fix solution
Programs like QuickBooks Online are marketed as simple and seamless, but they are unlikely to provide an all-inclusive solution. No matter how great a piece of software is, even the best applications require intelligent entry and analysis (as in, online solutions still require input from you).
And when you use bookkeeping and/or accounting software, someone still needs to know when to sound the alarm if a financial issue needs attention.
A good bookkeeping system is a lot like a gym membership. It gives you all the tools to keep your business trim and fit. But you have to use them, and you have to incorporate them into your daily operations if you want to see results.
Tip #3: Choose your partners wisely
If online software is only one piece of the equation, then engaging the assistance of professionals can offer a more comprehensive solution. A great bookkeeper can keep your files up to date and perfectly organized. Accountants love bookkeepers because they provide solid, verified data to determine things like: when is a good time to grow your business, or when it is time to wait.
As well, a good bookkeeping partner should integrate with your existing processes (not the other way around). Find a partner who will tailor their services to fit your business needs. This means less time spent learning new systems and more time spent on your own work.
Perfect financial records from the get-go, courtesy of a bookkeeper, means less time spent picking through them later, say, at tax time. Your accountant (and your bottom line) will thank you.
Tip #4: Make sure you have a firm transition date
When you’re making a transition from a shoebox record-keeping system to a sleeker bookkeeping method, you need to have a firm date of transition. This helps minimize confusion, and it can save you a great deal of time and energy down the line.
While the transition might take some time to set up (deciding on the program to use, getting familiar with it, making sure your business is ready to take that leap), you should have a hard cut-off date that’s in line with either the end of a quarter, or the end of a year. That way you aren’t trying to mix and match two different systems while still trying to report earnings, expenses, etc.
Tip #5: Do a trial run first
There is nothing worse then getting ready to take off, only to find out halfway down the runway that your vehicle of choice just isn’t going to give you the lift that you need to get airborne. Before you set your transition date, do a trial run. Get all the stakeholders involved. Make sure that there are no major flaws you need to deal with before making your switch. It’s better to find out there’s a mechanical failure when you’re still on the ground!
At Black Tulip, we have 23 years of experience providing client-focused administrative back office services. We strive to fully understand your business in order to deliver financial reports, increase your company’s efficiency, and ultimately, simplify your life. To find out more about our bookkeeping services and help your company reach the next level, contact us today!