Start a Bookkeeping Business – Business Name Tips

We have already talked about choosing a business name which is positive, reflects what you do and will give you some goodwill in your business in years to come, but there are some other things you can investigate when doing research for your business name.

Search Engines, for example Google, MSN and Yahoo all have people looking for information on a daily basis. If you do some research you can see what people are looking for in your area when searching for bookkeeping services. If you can find out what words people use and use them in your name or as a component of your name it can help increase your search engine rankings.

For more information or to joint the free e-course click here.

Start a Bookkeeping Business – 2 Key Things

When you have your own bookkeeping business, or are about to start one, there are many things you need to do to start, run and grow a successful business. Did you know that there are actually 2 key ingredients to your business which can save you and your business from ruin?

Well thats ok, many other bookkeepers don’t know about the 2 key things either, or they know about they but don’t understand how vitally important they are to your business.

Discover these 2 key thingsand many other great tips to successfully start run and grow your own bookkeeping business. Join the free e-course today and get the tips you need direct to your in box.

Double Entry Bookkeeping

What is Double Entry Bookkeeping? I have had a great response from people signing up to the free e-course on how to start, run and grow your own bookkeeping business. i am thrilled to help people succeed and I have also had some emails from people who are just starting their careers in bookkeeping. I have had a few questions about double entry bookkeeping so I have put together this basic explanation which hopefully will assist.

I am not going into accrual or cash accounting at this stage, it is just a very basic example and explanation of debits and credits.

For every action there is an opposite reaction. The same can be said for double entry bookkeeping. For every debit there must be a credit. In bookkeeping, you can not have a one sided entry, that is, if you have a debit somewhere, a corresponding credit for that transaction must also exist.

If you think about a chart of accounts as a filing system, this is the easiest way of understanding what a chart of accounts is and what you will do to it with the debits and credits.

Think of two filing cabinets, one is called profit and loss and the other one is called balance sheet. Inside each filing cabinet are lots of folders with different labels like income, expenses in the profit and loss cabinet and assets and liabilities in the balance sheet cabinet.

If you have a debit there must be a corresponding credit, so lets say you have a telephone bill for your business and it is $100 and you have just paid for it. You would file the telephone bill in the profit and loss cabinet in the telephone section. There is your debit. Since you know double entry bookkeeping means there must be a matching credit somewhere, the credit will be filed in the balance sheet cabinet in your bank account folder.

As you can see there was a debit (in the telephone expenses) and a corresponding credit in the bank account Double entry bookkeeping is really that simple, a debit must have a credit. The most challenging thing is to know when to use a credit in an account or a debit.

Going back to our filing system analogy, the balance sheet and the profit and loss have special rules. Depending on the type of account will depend on if you use a debit or credit. Sometimes people get very confused about this, but it is quite simple.

An income account is a credit, so if you increase your income account, you use a credit. If you decrease it you use a debit. The expense account is therefore opposite to this. The expense accounts are debit accounts, so if you increase your expenses, you debit the account, if you decrease them you use a credit.

Looking at the balance sheet we can see the similar patter. An asset account, such as your bank account is a debit account, which means to increase your bank account, you debit the account. To decrease the account, you credit it.

Liabilities on the balance sheet are kept in a credit account, so if you increase your liabilities you credit the account, decrease the account you debit it.

Of course this has been explained as simply as possible, but if you remember the basic rules, it is quite easy to grasp double entry bookkeeping.

Being a Bean Counter is a Popular Career Choice

Even with the global financial crisis, some industries are still needed and even flourishing. Bookkeepers, or bean counters as we are often referred to, are often in demand due to the growth over the last 20 years in small business.

20 Years ago, bookkeeping was not really a profession of its own. It was somewhere between being a secretary and working in an accounts department. As a profession it has taken off over the last two decades and in particular in Australia, with the introduction of the Goods and Services Tax (GST) on July 1^st 2000, it has really increased in popularity. This is not only due to increasing small businesses, but also in the compliance work which was created with the introduction of GST.

 The new tax on goods and services meant that businesses suddenly needed to understand their accounts on a quarterly, if not a monthly basis. Although this is a great business improvement from a management point of view, it did increase the small business owners paper load and compliance.

On a positive note however these changes have increased the demand for bookkeepers and improved the profile of the profession and it is an increasing career choice for people. Instead of being told you can be an accountant or a secretary, bookkeeping suddenly gets offered.

Bookkeeping is also becoming recognized as a quasi profession. It is becoming more regulated and there are a number of professional organizations available for bookkeepers to join. Historically this was not the case as it was only offered to accountants. Now though, bookkeepers can join membership based organizations and improve their professional profile. Additionally these professional organizations also offer professional development and additional education to improve the members skills.

There will always need to be bookkeepers in small and medium business. Many bookkeepers even start their own business endeavors and become their own boss by starting their own business. This is often popular with mothers who stop their careers for family commitments and only want to continue working pat time. Rather than finding an employer they fall into their own business by taking on a few small clients and gradually grow from there.

Additionally, if bookkeepers want to start their own business, it is possible to still be employed part time by an organization and start working for themselves on a part time basis until they build up a client base which is sufficient to sustain their financial commitments and not need an employer.

Bean Counters Start Their Own Business

Creating your own business is not something to enter into lightly and a love of bookkeeping is not enough to be a successful business owner. Having your own business takes time, effort, dedication and a lot of perseverance. It is a challenge and building a business from the ground up is not as easy as people think. Statistics show that many small businesses fail in the first 12 months and you don’t want to become a statistic.

If you are realistic and commence with a thorough business plan though it will increase your chances of success. The age old expression of businesses not planning to fail, but failed to plan rings true.

It is important to understand that taking a love for bookkeeping and making it into a viable business which requires additional business skills to be successful. You will need to know how to start your business, how to select your name and what licenses you might need. You will also need to plan how to get clients and what services you will offer. You will then need to think about ways of marketing your services and through what channels. You will need to do a complete costing of your services so you know how much to charge. Additionally you will need to check the market and see if your rates are in the ball park of other bookkeepers to be competitive. You will also need to plan for growth and eventual succession.

Fortunately bean counters are extremely lucky these days. There are many small business opportunities where business owners cant do the bookkeeping themselves, or don’t have the inclination to, but they do not have the work for staff, which is where self employed bookkeepers have become more and more needed to service a growing industry.

Additionally, bookkeeping as a profession is not as regulated as other industries and it is easy to get experience and basic qualifications so you can then go out and start your own business. Although it takes a big jump of faith in your abilities, if you have a love for bookkeeping and a desire to start your own business, perhaps being a business owning bean counter might be the way to go.

Start a Bookkeeping Business – Review your Services

So far we have looked at different structures for your bookkeeping business, licensing or registration issues andnaming your business. The next thing to consider is what services will you provide. I know this sounds strange, you think well bookkeeping of course, but many organisations require different things when it comes to “bookkeeping”.

The smaller the organisation, the greater your involvement of the bookkeeping. If you work for a larger organisation, you might not get involved with higher level duties.

Whatever level the organisation you are interested in doing bookkeeping for you will need to know what services you can offer before going into any client meetings. You don’t want to be put on the spot and have them ask for a service you can’t or aren’t able to provide.

Think through your services, accounts payable, accounts receiveable, payroll and associated tasks such as employee records and superannuation administration. Bank reconciliations, general journals, adhoc reporting and perhaps maintenance of cash flow spreadsheets. Balance sheet reconciliations and month end work. Bas preparation, IAS preparation, work cover, payroll tax and other payments. Are you able to do all of this, are you experienced enough and have the right qualifications or professional memberships?

Only the BAS services need special qualifications or associations to accounting organisations, but if you are in your own business, often these things get bundled together as they are above and you need to know instantly what you can and are able to provide a potential client.

Think about your services and what you can offer. Look at any edge you may have over your competition like specific industry experience and work out exactly what you can provide before going to see potential clients or designing marketing materials. It will help make you look confident, professional and polished.

Sign up to the e-course for more tips and ideas on How to Start a Bookkeeping Business.

Start a Bookkeeping Business

To learn about how to start, run and grow your bookkeeping business, subscribe to the e-course.

It will give you details about -

What structure to choose, how to pick a business name, registration, licensing, what services to provide, marketing, getting clients, keeping clients, setting up systems, home office requirements, invoicing clients, insurances, franchising, succession planning and more.

BAS Agent Registration

With the proposed BAS Agent Registration legislation, many bookkeepers in their own business are thinking about their options. With the minimum qualifications set at Certificate IV level, experienced bookkeepers can look at gaining their qualifications through the recognition of prior learning and skills assessment.

This is an easy process for any experienced bookkeeper and depending on experience, you may even have enough experience to be awarded the full certificate.

The National Institute of Accountants has a skills assessment area. For a fee they can assess your experience against the requirements of the qualification. This is an easy way of getting the required qualifications sooner rather than later with out a lot of study.

For more information join the e-course on how to start, run and grow your own bookkeeping business.

Subscribe to the Bookkeeping Business E-Course

If you are thinking about starting your own bookkeeping business or you have a bookkeeping business and you are wondering how to grow, attract clients, organise your systems and build your business for the future, subscribe to my e-course.

I have put together a short e-course from core components of my book, My Bookkeeping Business, How to Start, Run and Grow. It will give you an insight into the book and will give you practical information for your own bookkeeping business.

Your Personality and Your Bookkeeping Business

Having your own bookkeeping business sounds wonderful doesn’t it. Being your own boss, working to suit your hours on the days you want. No more staff meetings and deadlines from nagging bosses.

 

Hmmm, sounds great, but the reality is you suddenly have a lot more “bosses.” Each client will want to feel like they are your only priority and instead of one deadline, you have deadlines for every client. The clients look to you to answer their issues and questions and you will be responsible for a lot more than just work load.

 

Running your business you suddenly have your own bookkeeping and administration duties to attend to and clients to juggle. But if you plan and get the right information and advice, have a drive to succeed and the personality to keep going when you feel like it is all too much, then you can create a wonderful business to suit your circumstances and have a rewarding career at the same time.

 

It is important to have the right personality to run your own bookkeeping business. Attention to detail, good customer service, reliability, professionalism, knowledge and honesty. These are all key to running your own successful bookkeeping business.