Hearing the word start-ups charges you up because of the exciting opportunities it offers, especially regarding innovation. No wonder start-ups around the world grab a lot of eyeballs and funding from venture capitalists. However, in all the excitement of innovation and bringing a new product to the market, your clients ignore the most crucial aspect of any business, i.e., getting their finances right.
To get finances right, your clients will have to focus on bookkeeping right from day one which is not a glamorous job in a start-up but an essential one for long-term success. Start-ups usually get their bookkeeping handled through bookkeeping services offered by accounting practices like yours. But if they keep their finances in order, things will be better for them and your accounting practice. For that, the right strategies are required to be put in place. Here are some bookkeeping tips to help start-ups in maintaining financial clarity as they grow.
- Separation of Personal and Business Finances
Your start-up clients make one big mistake right from the start: mixing up their personal and business finances. Hence, it is important for you to guide your start-up clients to open separate bank accounts for personal and business purposes. By following this simple step, your clients will lay a strong foundation of transparency. It will be easier to track income, expenses, and profitability, file taxes, and prepare financial reports.
- Place Emphasis on Cloud-Based Accounting Software
Bookkeeping is important, and even more important is conducting bookkeeping activities according to the latest standards by investing in cloud-based bookkeeping accounting software. Since you are using this accounting software frequently, you can guide your start-up clients regarding its advantages, such as access to financial data from anywhere, collaboration with your bookkeeper or accountant, and streamlined tax preparation.
If you are unable to use the accounting software, you can partner with service providers offering their bookkeeping services and have experience operating this latest accounting software. This will give your start-up clients the confidence to focus on their business without worrying about their finances. Your clients may think bookkeeping and accounting is the same thing and use it interchangeable but that’s not the case, for more information please go through our detailed blog.
- Tabs on All the Expenses and Income
Accounting practices usually keep a tab on their start-up client’s financial transactions on their behalf, no matter how small. Having a clear record of expenses and income lets your clients, and you stay updated on the cash flow. This way they can claim tax deductions and you can prepare financial reports. Keeping a tab on even the smallest transactions is tricky for you and your clients. In such situations, you can enlist the help of accounting service providers offering bookkeeping services. Suppose your clients are located in a tough business location such as Coventry. In that case, the service providers accountants in Coventry can implement the tracking system by taking the business environment into consideration.
- Decide the Budget and Stick to it
Budgeting is essential for any business to maintain financial stability. With a clear budget in place, your start-up clients will be able to manage their resources effectively and avoid going over budget. You can help your clients make a well-thought-out budget by considering their financial health. You can also enlist the help of service providers offering bookkeeping services who will assist you in making a realistic budget based on your client’s unique needs and ambitions.
- Focus on Automation
By focusing on automation, your clients can save time and reduce human errors. For that, you will have to do the bookkeeping tasks using tools and accounting software. Accounting software will automate repetitive tasks such as invoicing, expense tracking, and bank reconciliation. Your accounting practice can implement this either by incorporating these tools or can partner with a service provider that offers bookkeeping services and automation. This will help in keeping your clients finances organised without any extra effort.
- Meeting Tax Deadlines
Filing taxes late or incorrectly with the HMRC will invite fines that could put your client’s start-up behind financially. UK start-ups usually delegate the task of filing taxes to accounting practices like yours. However, handling multiple tax responsibilities of start-up clients will overburden you. Hence, you must consider handing over this responsibility to service providers specialising in bookkeeping services and tax compliance. This way, you ensure that professionals handle your start-up clients’ tax filing.
- Monitor Cash Flow Regularly
Cash flow is the lifeblood of any business, and it’s important for start-ups to keep it positive to sustain their operations. You can help them by checking the cash flow statements on their behalf to understand the flow of cash, i.e., how much is coming in and going out. After proper analysis, you can present the details to your clients, who can then make informed decisions.
When your clients are working in competitive cities like Coventry or Oxford, they will require local help. In such situations, you can enlist the help of a service provider offering accountants in Coventry. They will provide your clients with valuable insights into how to improve their financial management.
Conclusion
Setting up a start-up in the UK requires considerable dedication, focus, and strategic financial management. By implementing the above bookkeeping tips from day one, your start-up clients can lay a strong foundation for growth and avoid future troubles. Your accounting practice can guide them in implementing these tips, but if you are overburdened with multiple tasks, you can enlist the help of service providers who offer bookkeeping services. They can help them stay organised, compliant, and proactive in fiscal management.
If your clients are conducting business in certain tough locations, such as Coventry or Oxford, which are budding cities, then we would suggest you get the bookkeeping services of a service provider offering accountants in Coventry. They will consider the location’s unique business challenges and devise plans that will equip your client’s start-up business to thrive.
