3 Types of Bookkeeping Systems Suitable for Small Businesses

Bookkeepers in a small business tend to rely on managing bookkeeping manually. This is mostly due to the limited amount of data and the lesser number of payrolls to manage. However, regardless of the bookkeeping method they opt, their primary goal is the smooth maintenance of the records. Choosing the right bookkeeping system for your business is the first step that requires your whole attention when it comes to records management.

The nature of your business can give you the idea; a sense of which method can help you achieve your goals without having to face any mismanagement. With the global economy being digitalized, bookkeeping consultants and companies have introduced software programs to cater to the bookkeeping needs of small as well as large businesses. Keeping the whole scenario in view, there are three types of bookkeeping systems currently used by most of the small businesses for the smooth flow of records and book management.

Single-Entry Bookkeeping

The single-entry bookkeeping system is a common choice of small businesses because it is less complex to manage as compared to the other systems. Each item is entered into the system through a single-entry. It is important to mention that sometimes it becomes difficult to keep track of huge volumes of data in the single-entry system. The prime focus of this system is to maintain cash sales and business expense records. The system works only if the items are entered into the system when they are incurred. At the end of a week or a month, the recorded data will be compared with the bank accounts. The single-entry system is not suitable for large businesses because it can only keep a track of less complicated expenditures.

Bookkeeping Software

Business accounting solutions are not everyone’s plate of food. For many people, it becomes difficult to understand and operate accurately while managing bookkeeping services. To overcome this problem and to minimize the possibility of any errors, bookkeeping consultants and companies offer computer software that is specially designed to manage bookkeeping the way businesses like. This software is designed for both, small and large businesses. You can choose the right one by comparing your needs with the functional capacity of the software. You can keep a track of all the accounts and transactions with easy-to-use interfaces. If you are a small business owner and have basic bookkeeping needs, then there is no need to look for the software that allows customized services.

Virtual Bookkeeping Assistance

A virtual bookkeeper is an agent that operates online and manages your books virtually. Virtual bookkeeping services are a great alternative to an in-house bookkeeper or accountant. Because they cost way more than a virtual assistant working remotely but just as effective. An added advantage of a virtual bookkeeper is that you can ask him/her to manage anything related to bookkeeping as per your request and instructions. Typically, virtual assistants upon hiring request business owners to buy bookkeeping software to manage everything. They will have access to the bookkeeping software and can manage everything in a timely fashion.

Suggestions

• The primary goal of using different methods or systems of bookkeeping is to maintain a smooth flow of records management.
• There are several systems used by small businesses to manage bookkeeping effectively.
• The three commonly used and suitable bookkeeping systems for small businesses are Single-Entry, Computer software, and Virtual bookkeeping.
• The single-entry bookkeeping system is a common choice of small businesses. Because it is less complex to manage as compared to the other systems.
• Each item is entered into the system through a single-entry and the focus of this system is to maintain cash sales and business expense records.
• Bookkeeping software is designed based on the needs of small as well as large businesses.
• Business owners can compare their requirements with the software’s functionality and choose the one they need.
• Virtual bookkeeping services are a great alternative to an in-house bookkeeper or accountant.
• They cost way less than an in-house bookkeeper but just as effective.
• An added advantage of a virtual bookkeeper is that you can ask him/her to manage anything related to bookkeeping as per your request and instructions.