February 7 saw the due date for end-of-year income tax for 2014. The week or two before that deadline can be a difficult period, especially if your small business is successful but concise record keeping isn't necessarily a strength.
More New Zealand businesses are speeding up payment processes than ever, only further highlighting the need to make sure all of the information centred on company capital is kept in check.
To that end, here are the things to keep in mind if your small business needs to improve its record keeping:
The burden's on the business
When it comes to filing tax returns and making sure the authorities are kept in the financial loop, the burden of proof will always fall upon the enterprise.
Keeping track of deductions and expenses is crucial, especially when those deadlines loom. At the end of the day, bad record keeping could lead to government sanctions, so improving it at every opportunity will always be the best practice.
Simplify the process
Businesses that use the 'out of sight, out of mind' mentality when it comes to their finances will often do so because they believe managing data effectively is an overly complicated process.
Implementing small business software such as CashManager from Accomplish can keep things simple and improve the accuracy of records in equal measure.
Everything from budgets to forecasted cashflow can be managed, making the whole process that little bit easier when those tax return deadlines are on the horizon.
Encourage investment
If you really want to grow your small business, finding the right people to invest can be essential. Companies that keep poor records and are scattered in their approach will likely be the ones that are overlooked.
Thinking long term in this regard is important. If you reach a tipping point and want to sell your business five, 10, 15 or even 20 years down the line, there will be very few potential buyers who forgive historically poor record keeping.