Top Bookkeeping Software Startups

Let’s dig into the basic steps required to DIY your startup’s books. Startups need more than a robot to reconcile the accounts, they need a trusted advisor who is in tune with their unique growth path. An outside bookkeeper provides a fresh and unbiased perspective on your financial situation, providing you with alternatives and options you may not have considered. More than just being good with the numbers, an accountant must also stick to best practices in their profession. In particular, you will want someone who is well versed in the Generally Accepted Accounting Principles (GAAP).

Among the ledger’s customizable features are account types, types of transactions, and reporting. Furthermore, you can automate various processes, such as workflows, transaction matching, and journal entry posting. In this way, you will not have to worry about having inaccurate financial records. It’s common for startup business owners to confuse accounting and bookkeeping.

Set up a table of accounts

Its application is available for both Android and iOS devices. As your startup grows and makes more revenue, your recordkeeping system will become more complex and crucial to maintain. This is why starting with a well-organized system as you run your business is essential. You can use simple and intuitive accounting software for startups to automate the accounting process and get an up-to-date view of your cash flow.

Your accountant will know where to find information about the relevant jurisdictions you operate in and keep your system always accurate. If you can find an accountant certified in multiple jurisdictions, even better. When it comes to income taxes, you can still take advantage of certain tax credits even when your business has no taxable income. Finding opportunities to defer tax credits can help save you money down the line. However, this doesn’t mean you shouldn’t concern yourself with taxes.

How to prepare your financial statements

But at the end of the day, your accountant’s job is to organize your finances and keep you tax compliant. Throughout this article, we’ve said that your accountant is able to give you advice on lots of things. Through their experience, your accountant will have seen lots of different arrangements around financing, accounting methods, startup strategies and more. Your accountant can help you determine how to put together a roster of services to carry out the administrative side of your business. They will have a working knowledge of the cost of various options to help you arrive at a solution that fits your business plan and your budget. While you may find accounting or ERP software that manages this for you, you’ll still want the eye of an accountant to confirm that you are always in compliance.

That’s why bookkeeping and accounting are so important, particularly for startups. Meanwhile, the accrual method recognizes revenues when you earn them and expenses when you incur them. It requires that you track accounts receivable and accounts payable, which often means you have to do more bookkeeping work by hand. Contrary to popular belief, there are multiple ways you can choose to maintain your financial records.

Cash Runway

As a result, company founders need to be highly strategic with their resource allocation, especially in their earliest days. Maintaining clean financial records is a lot like keeping a clean house. You’re better off doing bookkeeping for startups a little bit of work consistently than putting it off for months and trying to get everything done at once. It’s perfectly acceptable and much more efficient to keep a digital copy of each receipt, invoice, or statement.

Before you do anything else, take the time to establish separate accounts for your business. Most startups opt for one dedicated bank account and one business credit card to start. Most startup accounting also involves organizing separate ledgers for assets, liabilities, revenue, and expenses. Well-run businesses usually keep a general ledger, which is a combined record of all company transactions.

Whichever accounting software you choose, you will need to customize it to suit your business. This process includes first setting the software to use either cash or accrual basis accounting. In other cases, even if you are an educated accounting professional, you still might want to hire a professional to assist in your company’s accounting and bookkeeping system. Having an expert in business finances can help with journal entries and set up great accounting systems. They can give you and the other business owners the freedom to focus on your products and services’ growth path instead of slaving over tracking each line of data. Kruze clients used to almost exclusively use bill.com, which is a provider of accounts payable for companies of all sizes.