Bookkeeping Tips for Singapore Startups

As you launch your first startup, you may have to do bookkeeping for the first time. Bookkeeping for startups is not just the act of keeping records and receipts within the company. The process itself involves a certain level of skill in managing and reconciling these records. If you are just starting out with bookkeeping, it is imperative to get your processes right to avoid future financial complications.

Here are a few pointers to consider:

Accounting Templates

There are basic accounting templates which you can download and use as a start. Such templates are helpful if you have no prior experience with accounting software or the process of bookkeeping. As you get more comfortable using these templates, you may want to switch over to bookkeeping software for more sophisticated functions.

Accounting Standards

Businesses around the world have to adhere to specific accounting standards in various countries. Knowing the Singapore Accounting Standards will give you an overview of the kind of financial reporting you need to produce. For startups, familiarizing yourself with the Singapore Accounting Standards for Small Entities will be particularly useful.

Software and Hard Copies

Bookkeeping software can be confusing if you do not have any experience using it. Keep multiple copies of your finance records in both hard and soft copies as you start out. Doing so enables you to make comparisons for a better understanding. After you gain confidence in using your software, you can gradually switch to software-only bookkeeping.

Bank Transfers and Credit Payments

Automated payments present a few advantages.  Credit card companies provide monthly statements, where transactions are broken down in detail. These statements give you a record that saves you time in searching for and compiling your receipts when doing your bookkeeping. These statements also ensures accuracy in record keeping, as it is not possible to overdraw an account when using transfers and credit cards.

Expenses and Revenue

When balancing your company’s books, there are two types of transactions – Expenses (debits) and Revenue (credits). Take time to balance your books after each transaction. A miscalculation can shift your company’s entire balance and compromise accuracy. Ideally, your revenue should exceed your expenses.

Accounts Payable and Receivable

Accounts Payable are outstanding bills that need to be paid by your company. Accounts Receivable are outstanding bills that need to be paid to your company. If your company provides goods or services to consumers, you will want to keep track of both accounts and ensure all invoices are in check.

Bank Reconciliation

The process of reconciliation simply means matching your company expenses with the company bank statements. When you are paying company expenses, cross out each expense and check that it is reflected in your cashbook. Deposits should also be highlighted and their source noted. Monthly reconciliation allows you to visually manage your company’s cash and keep your accounts in check.

Scheduled Administration

Assign a specific day of the week to do your administration and bookkeeping. Once seated with your statements and documents, ensure that all administration is cleared for the week. Open your mail, compile and file your finance statements, and keep track of your expenses. Weekly checks will spread out your workload, and will also help you keep tabs on issues to follow-up on.

Payment Cycles

With your systems in place, let your stakeholders know when they can rely on you to get paid. Once the cycle is set, remember to be consistent in your billing. Such a practice will not only allow you to keep tabs on your payments regularly, but also to earn the trust and loyalty of your stakeholders. This loyalty will come in useful during negotiations or when you need favours.

Professional Help

When you start a company, you may want to concentrate on your operations and profits. Since bookkeeping requires a certain level of effort, you may want to engage accountants on a contract or part-time basis to get on the right track. You should also be aware of the fact that there are certain ongoing and annual compliance requirements for Singapore companies. Hiring a bookkeeping firm in Singapore not only helps you to meet these requirements but also to claim relevant tax incentives for your company. You may also want to consider engaging such services for tax advice and accounting strategies to streamline your operations.