Accounting Tips for Startups in Singapore
You may have read that ACRA issues summon thousands of business owners over bookkeeping and accounting mistakes in their annual filings. A large number of them are first-time startup owners. The fact is that experienced providers of accounting services in Singapore can help you overcome such issues for your new startup.
5 Key Accounting Tips for a New Business Owner
You will think that experienced business owners know better than play with their business’ compliance. You may look up to them for guidance. However, they too occasionally fall prey to such misadventure harming their branding and credibility.
You need to understand that securing business’ statutory compliance is a never-ending game. You have to watch your every step by being prompt with the bookkeeping and accounting. This is where you can benefit from the industry-wide knowledge of the reliable accounting services in Singapore. Here are a few important accounting tips for you.
1 Plan Your Major Business Expenses
Business owners face challenges every day. And you, as a startup owner, can vouch for the turmoil you endured over justifying an expense over another. There are times you need to go over budget and spend large amounts on essential items even when something inside you screams at you to stay within budget.
The expert advises appointing an experienced accountant or accounting services provider right on Day One, the day you start Singapore startup. If you were to follow them, these professionals would advise you to first list all the major expenses you know of and predict a few more. It will help manage your cash flow and the optimised use of your working capital.
2 Watch Your Small Expenses
You need to keep a careful eye on your small expenses. You hardly pay attention to these as they, individually, represent small amounts. They have the potential of slipping under your radar. And they can pile up into a huge total that you can ill-afford.
Your provider of accounting services in Singapore, during bookkeeping, can go through your business expenses and segregate them into essential and non-essential. Once the picture becomes clear, you need to exercise complete control to eliminate non-essential ones.
As you know, ACRA insists on the regular updating of books. The digitised records are reusable and can be used to prepare financial statements and management reports. An experienced accountant can go through them and give you deep insights into your business’ financial standing.
On the other hand, you can also use project management software to streamline and standardise your cash flow management. You can track your expenses, create proposals and manage sales leads.
3 Update Business’ Books of Accounts Regularly
Updating your books of accounts is an ongoing task. And you have to be prompt with it before the transaction slips to the back of your mind and out of your memory.
You need expert assistance when it comes to classifying your inbound money. Because not all the large amounts coming into your business are income.
Classifying each of them as your business’ income can impact and increase your tax amount. It is why you need to appoint an accounting services provider to assist you in keeping your records straight and accurate.
4 Treat Taxes as Your Business Expenses
How do you pay business’ corporate tax amount? Some small and mid-sized business owners dip into their income to rustle up the amount. They keep a part of their monthly income aside to pay their business’ corporate tax. However, doing so affects the overall understanding of their cash flow. And when you are busy with the other things, you may easily forget to keep the amount aside.
Experienced accounting services providers advise treating your tax amount as an expense. It means you must plan and provide for it in the budget. The actual tax amount may differ from your predicted amount. However, you can make a good guess based on your past performance and tax history. Ensure that your tax amount comes from your working capital like any other business expense.
5 Keep Business and Personal Expenses Separate
When you are a sole business owner and a multitasker, you tend to dip your hand in your pocket to pay for your business and personal expenses. However, this doesn’t seem right and leads to confusion when preparing accounts.
The experts advise maintaining your business and personal expenses separate. Doing so gives you more control and understanding of business’ cash flow. It is why many providers of accounting services in Singapore assist owners in opening a corporate bank account for their new business.
Accounting is an essential business process. The experts employed in accounting services in Singapore can go through it and reveal the hidden opportunities for you. And you have to keep at it as it is a part of statutory compliance. On the other hand, the data collected can give you insights into the business’ financial health.