Understanding the Importance of Bookkeeping and Accounting for your Business

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Understanding the Importance of Bookkeeping and Accounting for your Business

Let’s face it! The whole financial side of business can be intimidating and complex. However, the people at Andrews Datax aim to make that side of your business as easy going as possible. They take the time to get to know the ins and outs of your business so they could provide you with tailored relevant solutions and advice; allowing you to find ease and comfort so you could focus on areas of your business that truly need your time and energy.

Who Are They?

Andrews Datax Inc. is a Montreal based firm offering accounting, finance, and business services to their diverse clientele. Their loyal team has vast accounting experience and prides themselves on relieving you from the administrative burden that comes with bookkeeping, accounting and all other financial aspects related to your business.

What is Bookkeeping?

“Bookkeeping involves the recording of a company’s financial transactions. With proper bookkeeping, companies are able to track all information on its books to make key operating, investing, and financing decisions.”— Corporate Finance Institute

Bookkeepers keep track of the money your company spends and earns. They remind you of your company’s financial position and all transactions that take place within your business. Proper bookkeeping is significant for getting investors, financial institutions, and even governmental support; the collected data will determine whether to loan you money and how much.

What is Accounting?

“The accounting process includes summarizing, analyzing, and reporting these transactions to oversight agencies, regulators, and tax collection entities. The financial statements used in accounting are a concise summary of financial transactions over an accounting period, summarizing a company’s operations, financial position, and cash flows.” In other words, accounting is the means of tracking financial activity and analyzing the collected data. This information gives further insight into trends and opportunities that could earn your business more money.

Though they sound similar, accounting and bookkeeping are different. Bookkeepers oversee records and gathers data related to financial transactions within your company. While accountants are in charge of interpreting, classifying, analyzing, reporting, and summarizing the financial information collected.

Why is Bookkeeping and Accounting Important for your Business?

Accounting, bookkeeping, and other financial aspects of business are extremely crucial for strategic planning.

Benefits include:

  1. Tracking Your Progress
    Keeping track of your finances allows you to track your company’s progress. By analyzing where you were versus where you are now, you can witness the growth and success of your business’s financial gain and/ or modify your strategic organizational goals accordingly.
  2. Managing Your Cash Flow:
    Cash inflow tracks how money comes into your business (sales, investments, etc.) and how much money goes out (rent, bills, paychecks, etc.). The idea is to have more money coming in than is going out which is referred to as positive cash flow.
  3. Saving Time and Taxes:
    Because all your expenses have been noted and held on record, when tax season rolls around, the process can go along more smoothly. Bonus, you’ll realize you may have even accumulated some savings along the way!
  4. Estimating Your Upcoming Tax Liability
    Tax liability is the total amount of tax debt owed by your business to the CRA (Canada Revenue Agency). Simply put, it is the total amount of tax you’re responsible for paying. By managing your finances ahead of time, you can avoid any surprises.
  5. Making the Right Decisions for Your Business

By understanding your finances, you can be better prepared to make important financial decisions within your company such as knowing where to delegate funds, investments, and your business earnings.

  1. Providing Information Needed by Banks and Other Lenders
    The information gathered from bookkeeping and accounting are essential for receiving bank loans or other investments. Banks and lenders are less likely to give you money if you are unable to properly manage it.
  2. Avoiding Problems in Case of Audits
    If your books and records aren’t organized and complete, a government tax agency might not allow all your deductions. This could mean extra taxes, interest and penalties!

Size Doesn’t Matter

Regardless if you’re a small business, a growing business or a large corporation, bookkeeping, and accounting are integral components for the success and stability of your business.

  • For small businesses, Andrew Datax Inc accountants’ will set you up with the proper platforms, make sure you understand how to use them, provide ongoing support, serve as a voice of reason, and guide you if you choose to handle the work yourself.
  • If your business is currently growing and you’re too busy to deal with bookkeeping and accounting yourself, the professionals are right there to take over.
  • And if you’re already an established business, Andrews Datax has the expertise to handle large businesses. They work together with your team to deliver strategic advice and assistance to your existing accountant(s) and/or bookkeeper(s).

Why You Should Consider Outsourcing.

Being a business owner is tough as it is without having to worry about handling all the financial banter that comes with running a business. Afterall, you’re busy managing a company! You don’t need the extra stress and headache associated with financial management.

By delegating this work to experts like Andrews Datax who understand every aspect of business financing, bookkeeping and accounting, you can have room to breathe and trust that these crucial areas are being cared for properly. By outsourcing this work to the professionals you’ll have the freedom to focus on other areas of your business that truly require your attention.

Andrew Datax Inc. Services

Tax     Tax planning and compliance, tax savings, sales taxes, and even individual tax advice.  
Accounting     End-to-end accounting, financial reporting, budgeting and cashflow.  
Business Advice     Personalized advice related to business structures, management reporting and business consulting.  
Bookkeeping     Organizing records, managing books, and making your life so much easier!  

Andrews Datax knows that there are many other accounting firms out there claiming to be experts in the field, however many of them aren’t. They understand that your time is valuable, and you deserve advisors who know you are not here to waste your time, but to give some of it back to you! Contact Andrews Datax today!

By Makyla Coulombe