unting (and small business) //
A bookkeeper is essential for every small business. However, few businesses take advantage of accounting.
Accounting can be used to transform organized books into insight. Particularly:
- It can assist us in making decisions. It is best to ignore data that doesn’t help you make a decision. Granularity doesn’t always mean better.
- It helps us understand our cash flows. We know very little about a company at any one time. Over time, however, we are able to see how assets and expenditures flow. This gives us insight into what we have, its worth, and what we could do better (see #1).
- It can create trust systems. Once we know who is spending what, when, and why it is easier to stop micromanaging and instead focus on #1.
- It is possible to predict the future better than we can now. Budgets that are based on past experience are more accurate than budgets made in the present.
