You need to do this is because
- The ATO insists you send them reports of your income and expenses on a regular basis, so they can determine how much GST and income tax you need to pay.
- Your accountant wants accurate figures at the end of each financial year to prepare your financials and tax returns.
- It helps you prepare budgets and forecasts. If you don’t know where you have been, how can you know where you are going?
There are various ways of keeping records of your income and expenses, from simple manual ledger books or Excel spread sheets through to powerful and expensive accounting software.
I am going to assume that you are not a large organisation, with expensive software, so I am going to concentrate the small to medium business area.
These days bookkeeping and accounting software is readily available in a range of formats to suit just about every business need. There are online programs from about $25 per month that are relatively simple to use.
But, before you leap in, you have to consider if you want to do your own bookkeeping, employ someone to do it or outsource it.
I recently met someone who runs a training and communications business. She was looking for help with her bookkeeping because, as she said, she can run a training workshop and loves it, but doesn’t know the first thing about bookkeeping and doesn’t want to learn.
I would suggest your first step would be to contact a reputable bookkeeping business and get a no obligation assessment of your needs and recommendations of the best suited software. There are a number of places you can go to find qualified business such as Institute of Certified Bookkeepers or Australian Bookkeepers Network