With so many duties in their hands, bookkeepers, accountants, or those truckers who are in charge of their own bookkeeping may need the help of the following tips to get on top of their business.
1. Update Your Books Daily
When should you organize your accounting books and how often is appropriate? Monthly? Weekly? Or just whenever you have time to spare? The advice is that it’s best to do bookkeeping every day. There are days when you think nothing much is going on so it’s alright to leave the boring task of sorting out receipts and bills for tomorrow. But chances are that you may be busy the next day, and by the time you get to do it, you will have forgotten some details of the transactions. Make it a habit to finish bookkeeping before you call it a day so that you don’t need to worry about such a problem!
2. Choose The Right Software
The abundant availability of bookkeeping and accounting software nowadays might make you spoiled for choice. For trucking businesses, a cash-based accounting system is a popular option because it allows you to record transactions when money is received or paid, offering a clear picture of your current income and expenses.
It’s also important to consider the unique features of truckers’ bookkeeping practices when trying out and deciding on the one software that matches your needs. For example, some trucking management software has tools that assist with dispatching and calculating IFTA taxes, those functions that will be definitely welcomed by many truckers.
3. Go Paperless
However organized you are, keeping physical documents can take up lots of space and make bookkeeping a burden. The solution is not difficult to find in this digital era. Scan your receipts and invoices with mobile applications such as Shoeboxed or mail them using our Magic Envelopes, and leave the rest to us. You will be surprised at how fast retrieving and categorizing data can be, regardless of whenever and wherever you are. Discover many more useful functions for trucking bookkeeping at Shoeboxed.
4. Have A Different Credit Card For Business
Trucking owner-operators or small businesses tend to make the mistake of not separating their business account from a personal account. If you want to keep your business records in order, do yourself a favor and get a business-exclusive credit card. The last thing you want is to lose track of important paperwork, complicating the management of business records and finances in general.
5. Bank Checks? Check Them Twice
Like any other financial documents, bank checks must be kept in your books and preferably on the cloud too. But before that, it’s advisable that all contents of the checks are reviewed with care to prevent misinformation or fraud. Your signature should be clear and legible enough to be recognized, but it will be a problem if it’s too easy to forge.
6. Use A Banking Account With A Month-end Cutoff.
Closing your banking records at the end of each month can benefit the business in several ways. Since all the transactions that occur within that month have been fully recorded and reconciled, we can ensure that the accounting data is complete and accurate. Properly organized data not only helps to simplify other accounting procedures including tax filing and audits but also informs the decision-making process.
7. Manage Your Cash Flow
Keeping your books properly will be a lot easier once you understand the ins and outs of cash flow. Even though your business is making profits, if you don’t manage cash flow well there are chances that you will be in the red because the available money at one point is insufficient to cover urgent expenses. Bookkeepers in trucking businesses should always keep an eye on cash flow, acknowledging its impacts on smooth operational activities that bookkeeping is part of.
8. Get Your Records Ready For Audits
Audits accept both paper and digital documents, so fear nothing if you have everything at hand to substantiate all the transactions of your trucking business. You can carefully save and classify each receipt and invoice by yourself or entrust them to professional services like Shoeboxed, which turns your physical records into verified data that are ready for tax season.
9. Learn About Tax Deductibles
It’s a good idea to look into what can be deducted when you do bookkeeping. For example, if you are self-employed, expenses that are related to your business are generally tax-deductible. They include vehicle expenses (tolls, parking, maintenance, fuel, registration fees, tires, and insurance), specialized work gear, electronic devices used for work, work-related fees for drug testing, dispatch fees, leasing costs, etc.
10. Seek Professional Advice
Despite being equipped with the right tools to support your bookkeeping and accounting practices, unless you are confident in your knowledge of finances it is necessary to have your questions or problems solved by a professional. Even when your business is doing well, advice from a pro who knows the trucking industry will give you valuable insight to improve the overall performance. Try to have your business financial health checked by experts in the field and you will see the difference that it can make.
Learning the ins and outs of bookkeeping from scratch may be a real challenge, but you can start with these simple steps that we have compiled just for you. Remember, good bookkeeping – happy driving!