Accounting Or Bookkeeping Requirements Of Startups

Accounting Or Bookkeeping Requirements Of Startups

Accounting has always been a need for businesses to record all the business transactions and maintain proper books to show assets, liabilities, capital and profit and loss. Up-to-date records help businessmen to compare current financial information to past data. Businesses are here to earn profits and to know whether a business is earning profits, one must prepare a profit and loss account, which will ultimately show the results of transactions. 

One of the major reasons for startup bookkeeping and accounting is the preparation of files of tax returns on income tax, sales tax, wealth tax, exercise duty, tax on dividends, value-added tax, import and export duties, and many more. A businessman should always be aware of his business's financial position in the market. A statement called a balance sheet has all the information of the assets and liabilities of the company and thus helps in knowing the business's financial position. When a business wants investment from financial institutions, they have to show the necessary information in accounts, such as sales, profitability, and financial position. Start-up bookkeeping and accounting help maintain the records of all the employees through the payroll accounting management system. 

Accounts have all data on sales, stocks, profits, losses, and expenses. This data of own company and other competitions helps a businessman to variances of the Business Activities and thus take effective control over the business. The creation of an account is needed to ensure investors' safety of their money and also ensure employees of the business growth, which ultimately will benefit them in an increase of income. Accounting information is also needed to fix the company's budget and to do an analysis, cost control, and decision making by referring to accounts. 

Accounting and bookkeeping requirements of startup 

  • Reconciliation of statements: In today's world, bulky bank statements have been replaced by online banking. However, this does not reduce the need to reconcile bank accounts. Reconciling statements from time to time helps balance the general ledger, accounting for any bank fees and finding any bank statement errors. 
  • Credit card statements: Preparing credit card statements must be made just like any bank statement. Companies who have credit cards in their name that their employees use must make a note of every transaction on the credit card statements. Since credit card fraud is real with a lot of small charges on every transaction, the companies must have a backup for every charge on credit card statements. 
  • Payroll management: Every company with employees must maintain a proper payroll account. The account should record every single record from employee personnel to retaining employee time. One can also outsource payroll services to manage payroll records. 
  • Providing invoices: A company or a startup must provide an invoice to the users of their product or services as it is a sign of trust and a way to retain customers. And invoices can be generated from any purchased accounting software application and must follow up on every invoice given. 
  • Expenditure: According to IRS, a startup can deduct up to $5000 in organizational costs for the year it has become operational. And cost exceeding the deduction amount will be amortized. 
  • Receiving Payments: Irrespective of the mode of transaction, the company or startup should record and file the payment transaction done to the company and, at the same time, should be attached to the customer's invoice and filed. 
  • Paying Bills: A new startup must pay their bills due on time as this will build a good relationship with suppliers. And every time a bill is received, it should be properly examined and kept tracking it weekly after being added to the accounts to ensure timely payment.
  • Maintaining financial statements: A startup should maintain the financial statement either quarterly or monthly. If maintained monthly, make sure to add bank reconciliation so the balance in the general ledger and bank balance match—the details in the financial statement help to know a lot about a business.
Cost for accounting services 

Being a startup, the owner must try to reduce the expenditure from whichever part it can. And outsourcing accounting services is a great cost-effective option to cut down on expenses. Outsourcing accounting services are lower in cost than employing a full-time or part-time in-house accountant. The cost of accounting services varies widely depending on the size of the company/startup and what accounting services they want. The cost of bookkeeping and accounting services is usually charged on an hourly basis. However, a bookkeeper charges less than the accountant as the bookkeeper has less involved tasks. 

However, as a startup, an owner should hire accounting services costing an estimated value of $150 per hour rather than the one who would charge an amount as high as $160. The cost of an accountant may vary as per their experience and qualifications. So when choosing an accountant, one must look into the size of their startup, their needs, and the fees of the accountant as to why they bear the unnecessary expense.

Especia has been a start-up bookkeeping and accounting service provider for 11 years and is a cost-effective option to avail start-up bookkeeping and accounting service for businesses. It allows you to outsource any segment of your bookkeeping or accounting work that you feel is time-consuming or beyond your capabilities. It aims to build a robust foundation for any organization by implementing the latest technology and innovations to improve their tax and accounting services. It has an exceptionally experienced group of professionals working with them that helps companies associated grow significantly at a cost-effective price, regardless of their size and type. They offer their services across India as of now, intending to support clients at every stage of their business lifecycle to ensure the business remains compliant and growing.

So if you are struggling with your start-up bookkeeping and accounting management, get in contact with us today and enjoy the benefits of world-class start-up bookkeeping and accounting services from our highly professional experts.

Contact Us for Bookkeeping Services Outsource Accounting ServicesCFO ServicesESOP Services  in Delhi, Noida, Gurgaon, and all across India: write to us at accounts@especia.co.in. Or Call On :(+91)-9711021268 +91-9310165114

- Share this post on -