The Importance of Keeping Accurate Records for Small Businesses


Reporting accuracy is essential for all businesses, and all business owners should strive to achieve this with their records. As a small business, keeping reports up-to-date could be what you need to secure investment and reach your objectives. But why is this? Below, we will take you through the importance of accurate records. 


1. Track Business Growth

When investors come knocking and ask you to expand on how your business has grown and evolved, you need to be able to back up your claims with some solid proof and explanations! Accurate reporting enables you to track how your business is performing, identifying areas that need improvement and where you excel. 


2. Prepared Financial Statements

Save yourself time and stress by always keeping your financial records updated. You can achieve this by reporting your income, sales, expenses, and other financial transactions as they occur for maximum accuracy. When the time comes, this information will be on hand and ready to be fed into the financial statements, making your accounts much easier to complete.


3. Easier Tax Processing

Navigating tax as a small business owner is challenging, so you should do all you can to simplify the process. Having all your business finances in one account or a group dedicated accounts, with accurate records (invoices/receipts/contracts) to back up claims and reporting to account for different periods, will prevent you from guessing any figures while also making the process more streamlined at tax time.


4. Better Management 

As a small business, you must build an excellent reputation to increase your chances of success. Keeping accurate records ensures you pay contractors and employees on time while helping you chase up any delayed outstanding payments. 


Do You Need Help with Your Company Records? We Can Help 

If you’re a small business struggling to maintain and manage how your company keeps up with recording financial information, we can offer support. Get in touch with us here at Glance Consultants today to learn more about our services.


Understanding Financial Statements for Small Business Owners


No matter the size of your company, you will need to understand how to read financial statements that reflect your business’s economic activities. As a small business, you may need clarification regarding the ins and outs of financial statements, ensuring you know what is required. Keep reading to learn more about financial statements. 

Overview of financial statements

Financial statements record the financial activity, financial status, and performance of a business. The purpose of these records is to give a better insight and indication into a company’s financial activity and performance, whether for investment, tax, or financing purposes or to assess the future of a business.

Financial statement structure 

Financial statements follow a specific layout consisting of three components. 

  • Current balance sheet: Presents assets and liabilities. 
  • Profit and loss statement: The recording of revenues and expenses in a given timeframe.
  • Cash flow statement: Provides an insight into how proficient a business is with managing cash and covers financing, investing and operational activities.

When combined, these three components deliver an easy-to-follow rundown of the current condition of a business’s finances, providing better performance indicators for the business’s financial future. 

How to create a financial statement as a small business

Along with the structure laid out above, your financial statement should also include an income statement, in which you will detail your business revenues, cost of sales sold, and other expenses in a specified time, following a vertical format. Small businesses must include an income statement, as this section will provide insight into the company’s current financial performance and economic prospects. 

Need assistance with your business’s accounting & bookkeeping? We can help

We hope the above information has helped you understand why financial statements are essential for small businesses. Still, we recognise that you may need extra support when preparing financial statements for your business. Get in touch with Glance Consultants today for help with your financial reporting. 


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