How Small Business Owners Can Manage Their Accounting

When running a small business, you should have a basic understanding of accounting. Knowing the basics will make you feel confident about the future of your business, and you’ll have better knowledge to plan for your long-term financial success. As a small business owner, accounting helps you track and manage your money effectively, especially if you’ve just launched your business recently.



If you have any questions about your business accounting, please contact one of our certified public accountants (CPA), and we'll make sure you have all of the information you need to make sound financial decisions.

Organize your books

Begin by making a habit of compiling bank statements, recording transactions such as purchases, sales, and cash receipts, and learning how to categorize them. As a new business owner, you can manage your bookkeeping needs by using a simple spreadsheet that allows you to categorize the various streams of income that your company has. Using a spreadsheet, on the other hand, can be confusing, time-consuming, and prone to human error. Furthermore, as your company grows, using a spreadsheet is no longer recommended. As a result, you may want to use invoicing or bookkeeping software like Quickbooks. There is also the option of hiring or outsourcing a bookkeeper or accountant. You must organize your company's finances in order to monitor the cash flow in your business, set a specific income goal, and lower your taxable income by tracking and deducting business expenses when filing taxes.

Choose Your Recording System

Once you've established an organized bookkeeping system, you can choose whether to record financial transactions using the cash basis or the accrual basis of accounting. The cash method of accounting involves recording income and expenses at the time they are received and paid, whereas the accrual method involves recording income when you make a sale and expenses when you have them. Although the cash method is simpler, it is preferable to use the accrual method because it is more widely used and provides a more accurate picture of income and expenses over time.

As soon as your company starts making money, open a separate bank account from your personal one so you can keep track of your company's finances separately.

Your small business may begin as a one-man show at first. When the time comes to hire an employee, you must set up a payroll system and ensure that the proper taxes are withheld. You can look into accounting software that includes payroll.

Hire an accountant

When you become overwhelmed with doing and managing your small business accounts, you should seek advice from financial professionals. An accountant is one of the financial professionals you can consult.


Accountants can do many things in your small business and these include the following:

  • Form your business and make a business plan
  • Help open new bank accounts
  • Audit cash flow and manage your inventory
  • Manage debts and chase down payments
  • Plan budgets and find cost-cutting opportunities
  • Advised business strategy and recommend business tools
  • Prepare year-end reporting

Get Your Accounting Questions Answered by Accountants in El Paso, TX

If you’re looking for a reputable CPA firm in El Paso, consider calling us at Marcus, Fairall, Bristol + Co., PLLC! We’ll answer any and all of your accounting-related questions. We offer our clients a variety of accounting services such as the following:

Marcus, Fairall, Bristol + Co., PLLC

Full-Service CPA Firm
230 Thunderbird Dr. Ste G
Phone: (915) 775-1040
Location: El Paso, TX, USA

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