Skip to main content

What business records should i keep

Poor record keeping has kept many-a-small business from acquiring funding and other opportunities. Your word that business is doing great, stands no chance when it is not backed up by actual numbers. In most cases, because they are a one man show, many small business owners do not feel the need to keep proper records. At best, many simply keep track of the cash.... and that's about it. This article will answer the question- what business records should I keep?

Most of us dream of starting and running our own businesses. Many however are thrust into the world of business without a clue what to do and how to do it. I hope this will shed some more light and help you identify the necessary records for your business to keep.

The failure to keep a decent set of records could badly damage any business. We therefore need to understand the costs of not keeping business records.

THE COSTS OF NOT KEEPING BUSINESS RECORDS

Not keeping decent business records disadvantages your business in the following way:

1. No tangible proof of your operational track record. Many banks, lenders and investors require this information.
2. You miss out on critical decision making information.
3. You expose yourself to fraud and other business threats.
4. Conflict when memory fails and you resort to "he say-she say" to resolve matters
5. Inefficiencies that result from operating without sufficient information.
6. Weak client relations.
7. No basis for making future decisions. 
8. Weak legacy and historical record.

One of the greatest takeaways I got from my mentor some years back, was:

"Let the numbers speak for themself. You do not have to explain."

What this means is, if someone owes you money, have it on record. Have it in writing that they owe you. Get witnesses and additional documents like their proof of residence. When a transaction is made, have it documented in as much detail as possible so that even in your absence, the documents easily make sense to whoever views them.

This means the date, details, price, quantity, person responsible, time and any relevant information. Your company policies should not be ambiguous and employees should confirm their acknowledgement in writing. 

I generally discourage small businesses from starting off with fully fledged systems. Your business should guide you and tell you what records are to be kept. 

Do not keep records for the sake of it.

Let them become a strategic part of your business and eventually a competitive advantage. For example, instead of just recording a simple sale, you can structure your records to include a follow up. 

WHAT BUSINESS RECORDS SHOULD I KEEP

Depending on your type of business, the records to be kept will vary from one organization to the next. Some of the common records are:

• Accounting and book keeping records
• Bank records 
• Contractual agreements, permits and licenses
• Company records 
• Correspondence
• Employee records
• Forms
• Intellectual property
• Marketing and advertising records 
• Stock records
• Tax records


Record keeping checklist infographic


SHOULD I KEEP ELECTRONIC OR PHYSICAL RECORDS?

The trend nowadays is leaning towards paperless records, but I would recommend a combination of both. If you are maintaining online records, make sure that the security is tight and you have back ups. An easy way is saving documents in your google drive. 

Using your mobile device you can record transactions on the go and back them up on the cloud. There are a number of online accounting tools that one can use. The Business Builder App comes with a number of record keeping tools. In addition to the milestones and daily progress, you can create quotations, invoices, receipts, record cash transactions as well as information about various stakeholders such as customers, employees, strategic partners and more. You can download the Business Builder App here: 


As always, I wish you happiness, health and wealth. Till next time

Labels:

Comments

Post a Comment

Popular posts from this blog

Hip hop and RnB songs to apologize to your partner

Love is a beautiful thing, but it often goes wrong. This often leads to pain, suffering and sorrow.  Being imperfect beings, hearts tend to get broken all the time regardless how hard we may try to avoid it.  The heartbreak is often inadvertent but at times we find ourselves in the wrong. An oversight, a word unsaid or even a lapse in our judgement can cause our loved ones harm. This doesn't always have to be the end though. Oftentimes, relationships can be mended by simply uttering three simple words: "I AM SORRY". This article is a collection of some of my favourite 'I'm sorry' songs. I hope you'll enjoy these apology songs, but more importantly, I hope you will get a few quotables and some wisdom nuggets from them.  The best apology however, is to change behaviour (got that from a Jay Z interview) so as you apologize, please remember that it was your actions that hurt them. The best apology is one which involves you not repeating those same mistakes aga
Post a Comment
Read more

Php date: How to get the first and last day of the week

In this tutorial, I'll show you how to get the first and last day of the week in php. By default, in PHP the week runs from Monday to Sunday. However we'll cover two methods to get the first and last day for both those who consider Sunday or Monday as their first day of the week. We will be using 2 functions to achieve this: date() strtotime() We will use a combination of these two functions and store the result in a variable.  How to get the first day of the week If you want to get Sunday, use this method: $firstday = date('l Y-m-d', strtotime("sunday -1 week")); echo $firstday; If you want to get the date for Monday, this current week, use this method: $monday = date('l Y-m-d', strtotime("monday -1 week ")); echo $monday; How to get the last day of the week The following code will give you Saturday as the last day of the current week. $lastday = date('l Y-m-d', strtotime("saturday 0 week")); echo $last
Post a Comment
Read more

How to easily create background notifications in Sketchware(original)

How to easily create background notifications in Sketchware(original) One of the keys to building a successful app is to find mechanisms that will keep your users engaged. You can do this by using background notifications. This tutorial will show you how to do that in Sketchware. We will cover: 1. How to create notifications in Sketchware 2. How to show these notifications even when the app is closed.
7 comments
Read more