And that means setting up a payroll system to pay your weekly or monthly salaries to staff. Once the business grows to a certain size, youвЂ™ll need to take on employees. Get the details right вЂ“ invoicing mistakes can be a challenge, so ensure youвЂ™re sending each bill to the right contact, for the right amount and with the right payment terms.ДЄutomate your invoice chasing вЂ“ chasing late invoices takes time, so use the benefits of automated credit control apps to automatically chase up late-payers. So keep your invoicing online to maximise the benefits and added value. Keep the process digital вЂ“ most accounting platforms now include online invoicing as standard. To create a streamlined invoicing process: These days, online invoicing takes all the heavy lifting out of the process, allowing you to quickly raise an electronic invoice and email it direct to your clientвЂ™s accounts payable team. The good news is that invoicing has evolved in the digital age! But, historically, invoicing used to be a time-consuming task, with invoice templates to populate, hard copies to print and envelopes to be addressed. Small business invoicingД®fficient invoicing is a key feature of your streamlined finance set-up. Link payments to your bank account вЂ“ many accounting platforms offer live bank feeds, so you can easily match incoming payments to your invoices.Д¬heck your aged debtors вЂ“ running an aged debtor report shows you who hasnвЂ™t paid, so you can quickly chase up late-payers and get that money in through the door. Offer the best payment options вЂ“ think about how your customers pay you, and offer the simplest and most hassle-free way for you to get paid. As a modern digital business, you can choose from online card payments, Direct Debit and payment gateways such as PayPal etc. And creating the most efficient payment set-up is central to this. The easier you make it to get paid, the faster your customers can pay you. Listen to the experts вЂ“ expert cashflow tips help you to maintain the perfect balance between income and expenditure, so you achieve the ideal positive cashflow position.ДЄim for intelligent cashflow вЂ“ cashflow forecasting apps, like Fluidly, provide smart tools for predicting and managing your cashflow status, and keeping you in control. Get to know your cashflow statement вЂ“ your accounting platform can produce a cashflow statement that shows you all the cash inflows and outflows within the business. To manage cashflow effectively in your business: Cash is king, so staying in control of your cash inflows (income) and your cash outflows (expenditure) is crucial for driving the financial success of the business. The importance of cashflow management really canвЂ™t be underestimated.

Use real-time reporting вЂ“ real-time information gives you a totally current view of your finances, so you can see the impact of expenses on your cashflow and working capital. Keep bookkeeping up to date вЂ“ by keeping your bookkeeping timely, you have the best possible real-time overview of your expenses and running costs. By creating codes for every expense, you can easily track your expenditure. Tailor your Chart of Accounts вЂ“ your Chart of Accounts is the list of codes used in your accounting. When you know what youвЂ™re spending, you have more control over where that money is going вЂ“ giving you the information needed to get proactive about reducing those costs and boosting profits. Tracking what youвЂ™re spending as a business is good accounting practise. Part 2 of our small business accounting 101 looks at managing your finances effectively. That means tracking your numbers, streamlining spending and getting in control of your cashflow management strategies. Having the core financial elements in place means youвЂ™re building the company on the most solid of accounting foundations вЂ“ and thatвЂ™s important for your continued success.ДЄccounting isnвЂ™t always easy but once youвЂ™re comfortable with the basics, you can dive into the deeper financial management of the business. Setting up a small business accounting system is a vital part of starting your business.

Small business bookkeeping 101