What is the Checklist for Effective Bookkeeping by Entrepreneurs in Dubai?
All business owners are proficient at creating great products and services, building effective teams and winning over customers. However, many of them find it tough dealing with basic bookkeeping in Dubai. As the business owner, if a person doesn’t understand the different types of accounts prepared to organize your finances, measuring the success or failure of the efforts will be useless.
Business owners need to know everything about the business’s finances. It not only helps business owners to make right decisions and plan for the future, an efficient bookkeeping system saves time. Most importantly, it prepares businesses for audits and helps prevent fraud.
- Choose Accounting method
The first thing entrepreneurs need to figure out is business accounting method. The two methods are cash and accrual. The primary difference lies in the recognition of transactions by a company. In accrual accounting method transactions are recorded on occurrence, not when they are paid whereas in cash accounting method transactions are recorded on payment.
- Know what kind of records to keep
Legal documents: Business licenses and permits, Tax licenses and any other documents that have legal significance for the company’s activity should be stored separately and be kept accurate and correct.
Supporting financial documents: The source documents are of a great value for a business because all accounting operations are based on them. Supporting financial documents include all contracts with clients, invoices, receipts, payrolls, cash registers and other relevant documents.
- What and how to record
Everything that has reference to money and that explains your transactions should be recorded properly. Keeping day by day records of both receipts and payments transactions are important. Record the amount of cash that comes in in the form of payments for the number of goods and services you sell and when.
- Document management
Entrepreneurs should use well-organized process of document management to ensure high efficiency of a record-keeping system which reduces the number of mistakes and increases responsibility for a document creation. Businesses should know exactly where business documents are located, what kind of templates needed and how to use them.
- Separation of business transactions
Separation of business and personal finances gives businesses professional looking. Entrepreneurs can do so by opening savings accounts in personal name and opening current account in business’s name.
- Proper Presentation of Financial Statements
Use of proper format for presenting financial statements which helps in providing true and fair view of the business’s financial health.
- Choose Accounting Software
Businesses should make a list of accounting features (inventory management, merchant account support, tax reporting and others) they need to narrow down accounting software choices. Using online accounting software which is built specifically for small businesses can help. To understand how the things work businesses can start with free accounting software like Zohobooks,Wave, TurboCash or cloud-based ZipBooks.
- Get professional accounting support
Everything changes with the growth of business. A qualified accountant will help to handle growth transitions, set up a company structure that best suits your business model, gives recommendations and more.
Many business owners think bookkeeping is a monotonous work, but if a person understand and effectively uses the data bookkeeper collects, bookkeeping in Dubai can be very useful.
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