What Is Bookkeeping?
Bookkeeping is the recording of financial transactions of a business. It is an important part of any business.
It is important to keep a good financial record of all income and expenses in your business. These records need to be kept up to date and accurate.
But, What Is Good Bookkeeping?
Good bookkeeping can be anything from a regularly updated Excel spreadsheet to an accounting software package that is well maintained.
Knowing what method will suit your business will depend on your business.
For example, if you have a high number of purchase and sales invoices, you might be better investing in accounting software.
Or, if you have very little invoices, Excel could be perfect for your business.
Books And Records
Businesses and individuals must keep any supporting paperwork used for calculating VAT and Tax.
You should keep a record of all sales and purchases as well as any money received and paid out by the business.
Your records should contain the relevant details to explain transactions if Revenue was to ask.
Your books and records should be kept accurately so your accounts can be prepared correctly.
What Books And Records Should I Keep?
- Sales Invoices
- Invoices or Receipts for Purchases
- Invoices or Receipts for Expenses
- Bank and Visa Statements
- Wages Sheets
- Stock Reports
- Nominal Ledgers
- Physical Accounting Books
How Long Do My Books, Records and Receipts Need To Be Kept?
How you keep your records relies on how an invoice is generated. If your client gives you an invoice in paper form, you should keep the invoice in paper form.
You can keep a physical or digital copy of your books, records, and invoices.
If Revenue asks to see your invoices, it is not enough to have invoices that are uploaded to your accounting software. You must have a physical or digital copy. If you keep digital records, they must be maintained securely.
You should make it a priority to continuously update your records. We would always advise making a routine to update your books, this could be every week or every month whichever suits you.
Your records should be maintained within Ireland and should be written in either English or Irish.
What Should My Accounting Books And Records Look Like?
Someone with good records should have a binder or online folder with the following;
- A sales book or copies of sales invoices.
- Purchase invoices for purchases of materials, categorised by date, supplier or by reference.
- Bills and receipts for business expenses, categorised by date, supplier or by reference.
- Copies of bank statements.
- Wages book.