Read our beginner bookkeeping guide to help get started with your business or personal accounts. Knowing where to start is difficult, but going through the stages will help.
There are so many reasons why bookkeeping could be useful to you, including running a small business, charity accounts or personal accounts.
Beginner bookkeeping – where to start
Depending on the size of the project you are working on will depend on how you complete your records, there are several different choices:
Excel templates – can be an excellent start to get you up and running. We have some free Excel templates, including a cash book and a budget template. These are suitable for personal or small business.
Accounting book – If you are keeping track of simple accounting, then a book may be the answer. It will include columns for listing detail and analysis of income and expenditure. An analysis book is a manual way of completing the records.
Accounts software – There are lots of different software available, most now are all online, so there is no upfront fee. They range from Wave and Pandle, which are free to QuickBooks, Sage and Xero; all have a monthly fee. The advantage of a software package is it will grow with your business, but you may need help in getting started.
Do I need a Bookkeeper or Accountant?
I would suggest getting you started to speak to a bookkeeper or accountant; they will be able to recommend the best set up to record all your information. If you can complete the bookkeeping yourself, it may be that you require their services at year-end to ensure the records are correct to submit to either Companies House or HMRC.
You may want to use the services of a bookkeeper regularly; this will leave you more time to run your business knowing that the accounts are in safe hands.
Beginner Bookkeeping – Keeping Records
You will need to keep records of all your transactions from sales invoices and purchase receipts to expenses. Lots of payments are online, so it is worth printing off receipts as you spend money.
Depending on the amount of paperwork depends on the filing system needed. If there are only a few records, then a folder or you may need a lever arch file to keep the sales and purchase separately. You will need a filing system which can either be month by month are alphabetical by supplier and customer.
How often should I complete Accounts? How frequently you complete the accounting records depends on the size of the information you are recording. A large business will need information daily and will have a team to do the work. A small business may only have a few records and needs to get the figures for the year-end. Most require the information on a weekly or monthly basis.
Accounts each year will have to be submitted to either Companies House for Limited Companies, or HMRC if you are self-employed.
Beginner Bookkeeping – Single Entry or Double Entry
A single entry system is a simple record of all your income and expenses shown in a book or spreadsheet.
Double entry is more complicated and records transactions twice in the system. A couple of examples are that you purchase some stationery; the transactions will post to both the expenses and bank balance. The double entry will produce both a Profit and Loss account and Balance sheet, which most businesses will need.
Lots more information can be found on this site to help get you started, take a look at our bookkeeping basics for further details.
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