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Best Practices When Starting a New Business: Part 1 of 3

There are many best practices to keep in mind as you start your own business. These items can help turn a start-up business into a long-term business. The next few posts will discuss six key steps that can help bring success to any new business, especially if these steps are started from the very beginning. Two great starting points would include 1.) being sure that all business accounts are separate from any personal accounts and 2.) integrating accounting into the business practice.

  1. Separating business accounts from personal accounts.
    • Be sure that you use personal funds for personal purchases and business funds for business expenses. It is important that you do not co-mingle funds. Open a separate bank account under the business name once you’ve officially created your business.
    • Only use this account for business purposes – never personal expenses.
    • If you open a credit card in the business name, practice the same philosophy. Only use this for business expenses and never for a personal purchase.
  2. Integrating accounting into business practice.
    • Be sure that you have some type of bookkeeping plan, whether it be software (excel or QuickBooks) or a physical book to write everything down.
      • If you make a sale, make sure to record the sale as quickly as you can, as this will help ensure you do not get behind on your documentation.
      • Send invoices out on time, and make sure that you’re not allowing yourself to procrastinate. This has the potential to improve cash flow.
    • The best practice here is to make sure that everything is recorded and reconciled monthly at a minimum. This allows you to make decisions supported by accurate financial information.

We believe the steps discussed above can be very beneficial in helping your small business succeed. Stay tuned in the coming weeks for the next couple of posts!

Please contact us at Frankel Zacharia if you have any questions or would like more information.

Scott Weaver, CPA

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