Our Guide To Business Finances
When managing a business and the finances that come with it, it is important to keep track of payments coming in as well as going out. But this can become difficult when there are several transactions all at the same time. Here, we are going to give you some of our top tips for managing your business finances.
Stick To Your Budget
When managing business finances, it is crucial to stick to the budget that you have for that financial year. This is crucial as your funds will need to be monitored to keep track of outgoing and in going payments. This is essential, especially if you are a smaller business as stretching the budget can leave you in a financial emergency.
Although there are loans to help you in these financial emergencies, it is important that you are aware of every aspect such as understanding APR on short term loans to help you when faced with such a financial emergency. In addition to this, sticking to your budget will help you to meet the repayments and pay off the loan in no time.
Invest In Software
Another way that you can organize your business finances is through investing in software. This keeps all the ingoing and outgoing payments in one place, allowing you to monitor every aspect of the business. This information can then be put into charts and graphs and printed off to bring into monthly finance meetings, helping to better understand the companies spending habits and seeing where they can cut spending.
Keep Copies Of Invoices
In addition to this software, it is also beneficial to keep copies of all invoices that are either inbound or outbound. This is vital as this will help you to keep track of the overall spending and keep track of who has paid you and who hasn’t. This can be done either through a digital software of all invoices or paper copies to ensure that there are multiple records of all invoices, should one become corrupted or lost. These should all be stored in a secure location and should only be held for as long as needed due to GDPR regulations within the UK.
The final way that you can monitor the business finances is through regular business meetings. Whether this is just the finance team and the CEO, or the rest of the business, this is a benefit to the company as everyone will be aware of the budget that they have remaining as well as where it is being spent. This ensures that everyone in the company is on the same page and is aware of the current financial state. This is vital to the moral of the business as everyone will feel as though they are one team.
Regardless of how you eventually end up monitoring your finances, it is important to stay on top of everything as this can have a profound effect on the company should you begin to overspend. Where will you begin?