The practice of Book-Keeping is something that is very vital to the success of every business. However,It has been discovered that Most MSMEs neglect this practice. The reality of me not being able to say something worthwhile about my business' position as a result of neglect of book-keeping dawned on me after more than 7 months into her existence.
Book keeping is the process of recording and Maintaining of financial transactions and Information relating to a business on a daily basis. It is the Practice of recording ALL that relates to your business financially.
What Records should I Keep?
While every businesses can not all have the same class of records to be kept because the operations of each business differs, there are basic class of records common to businesses.
Businesses are not meant to be operated casually
■ Sales - All regarding what we sell or our deliverables should be recorded.
■ Income - All coming into the business as values should be properly recorded
■ Account receivable - This records those who are to pay you(debtors)
■ Account payable - This records those you owe (creditors)
■ Inventory - Your record of unsold stock
■ Personal drawings - This records how you dip into the business resource for your personal use.
It is important we properly have a good record of our business operation in these class of accounts. Because Not having a good practice of Book-keeping makes you far from your business
Maintaining proper book-keeping practice helps in providing us data needed for maintaining Financial statements, helps in setting the right prices for our products ,helps in measuring your business performance and even in your business planning.
Resource one can use in proper book-keeping include but are not limited to Microsoft Excel spreadsheets, software such as Sage and Quickbook.