Common bookkeeping issues (and tips to resolve) for small businesses
Running a small business can be demanding. From getting the right resources to overseeing finances, there are numerous challenges that small business owners must navigate to thrive.
Small businesses frequently encounter similar bookkeeping issues as large corporations. Nevertheless, they must be prudent with expenses to avoid unnecessary risks. Without sound and robust bookkeeping practices, small businesses often struggle with the following challenges:
Inconsistent Cash Flow
Cash flow refers to the available cash within your business. In absence of a well-structured cash flow system, keeping track of outstanding payments and accounts receivable becomes a complex task.
It’s also common for small businesses to make cash flow errors, such as making purchases without considering alternative funding sources, which can subsequently impact your cash flow.
Tip 1
Keep your Xero file up to date. It will give you a estimate of what income you expect to receive on a week–by–week basis
Tip 2
Create an Aged Receivables policy and implement it. There is nothing worse than having to chase long outstanding debts. Stay on top it by being in constant contact with your customers/clients.
Managing Payroll
As per Australian Taxation Office (ATO) guidelines and the implementation of Single Touch Payroll (STP), maintaining accurate employee payroll records is crucial for regulatory compliance.
Consequently, businesses must retain specific records containing identifying details for each non-exempt employee, including information on hours worked and wages earned. Failure to comply may lead to substantial penalties.
Managing this can be complex, considering the newly announced PayDay Super requirements that will come into place in 2026, therefore, it is advisable for small businesses to consider outsourcing their payroll management tasks to experienced consultants.
Tip 3
Setup Xero Superannuation. It will get you in the habit of paying employee superannuation obligations on a weekly basis well prior to the implementation of PayDay Super.
Tax Planning
Missed quarterly estimates, under withholding, missed deductions, and improper filings are just a few examples of common bookkeeping issues. There are many small business owners out there who have trouble meeting these demands.
If your accounts are not accurately kept, there’s a possibility that you will be paying too much in taxes. It’s always advised to find bookkeeping experts to manage books and help in tax preparation.
Tip 4
Keep your Xero file up to date and that will allow our experienced staff to make accurate decisions in relation to tax planning on a quarter-by-quarter basis.
Looking for experienced and trusted bookkeeping service? Let’s get the conversation started! Our friendly team is always up for a chat. Stephenson Partners are here to answer any tax questions you may have and discuss bookkeeping solutions for you.
We have offices located in Grafton (02 6642 5900), Maclean (02 6645 1880), Iluka (02 6645 1880) and Gold Coast (+61 412 282 280) and service area from Brisbane to Gosford.
