Back to Basics: Keeping good business records

DarnelleBusiness Process

Keeping good small business records mean so much more than knowing which records to keep and for how long. In many cases it means the difference between failure and success.

Why keep records?

Business record keeping should include setting up systems that allow you to easily monitor the progress of your business and track business performance. By tracking the performance of your business you will be able to make strategic growth decisions. The other reason is that you are required to do so by law.

By law they must be:

  • in English or in a form that we can readily access and use to work out the correct amount of tax you are liable to pay
  • kept for five years after they are prepared, obtained or the transactions are completed – whichever occurs latest.

Keeping good records assists businesses to:

  • complete activity statements, tax returns and fringe benefits tax returns
  • provide written evidence of tax related transactions
  • resolve issues relating to disputed assessments or adjustments.

How to keep good business records:

The ATO states that you can “keep your records on paper or electronically”.

At 542, we ONLY keep records electronically. Paper records are a non-no.  We work hard to make sure our clients have the right business processes in place to save time and money.

A variety of electronic record keeping packages are available on the market but we can’t go past Xero.

Want to know more about Xero?

Read our blog: The grass is bluer on the other side: Why everyone loves Xero or register for our free event Save Time and Money with Xero.

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