The double entry method leaves less room for error, making it the better choice for balancing complex books. With the help of cloud accounting software for small-business bookkeeping, you can pretty much automate the process. Online bookkeeping uses software that takes care of most of the calculations and data entry for you. A program like QuickBooks cloud accounting software, for example, can help you track income and expenses much faster than you could with a traditional ledger. The double-entry system of bookkeeping is common in accounting software programs like QuickBooks. With this method, bookkeepers record transactions under expense or income.

In that case, you must keep the records for six years after the year of the asset’s transaction, as they might be relevant for capital gains calculations. Our top recommendation is QuickBooks, but if you want to see a full review of various software for bookkeeping, we already have a detailed blog post about the Top 7 Bookkeeping Software for Small Businesses. A business plan may be required business bookkeeping if you plan to apply for business financing from banks or investors. Unlike the requirements to become an accountant, the training required to become a bookkeeper is less strenuous. There may be additional steps required if you plan to hire employees for your business. For instance, California requires workers’ compensation for all employers, regardless of the number of employees.

Small Business Bookkeeping Tips

If you’re searching for accounting software that’s user-friendly, full of smart features, and scales with your business, Quickbooks is a great option. Along with reading this page to get a quick bookkeeping overview, we always recommend meeting with a CPA (certified public accountant) or bookkeeper before you open your doors. A financial expert can give advice specific to your unique business and give you a more in-depth look at basic bookkeeping principles.

Most of the time, a qualified professional can correct or document these errors. The specific amount of an emergency fund may depend on the size, scope, and operational costs of a given business. Regardless, work with your bookkeeper and accountant to ensure the amount of cash left in the bank is sufficient for unexpected costs. Finding the right level of cash to be kept on hand requires a proper cash flow forecast and cash monitoring.