Starting a business is an exciting venture, but it can also be an overwhelming one, especially if it's a one-man show. It can also be an overwhelming experience when it comes to dealing on how you should manage your finances that can be challenging at times due to various reasons.
Healthy financial goals can only be achieved by practicing some essential accounting practices that evolve around managing your finances effectively ... and these include the following:
- Keep track of your financial transactions – Record all financial transactions, including income and expenses, in an organised and accurate manner. This information will help you understand your business's financial health and make informed decisions.
- Financial projections and budgeting – Set up a budget/financial plan that helps you track and manage your expenses. It's essential to create a realistic budget and update it regularly to ensure that you're on track to meet your financial goals.
- Use accounting software – An accounting software like Xero can help you manage your finances effectively. This can help you save time while reducing the risk of any unwanted errors.
- Seperate personal and business finances – Keep your personal and business finances separate. A good practice is to open a separate bank account for your business, and use it solely for business-related transactions. Professional advisors can help you get introduced to banks or electronic money institutions.
- Monitor cash flow – Monitoring your cash flow will help determine how much money is moving in and out of your business account. This will help you predict any future financial issues and make good financially informed decisions.
- Hire an accountant – Consider seeking advice from professionals in the field. Hiring an accountant to manage your finances, can provide you with valuable advice, but most importantly, this will help you avoid costly mistakes. A professional will also guide you to access any funding opportunities that are related to your business.
- VAT registration and compliance – An accountant will also assist you in anything related to VAT and taxes in Malta to keep abreast with all latest updates and ensure that your startup won't miss any important deadlines that might lead to penalties.
The above are just a brief guide of start-up essential tips. By managing your bookkeeping and accounting from the very first stages of the business setup, you can gain better control of your business finances. The team of accountants at Fairwinds Management Limited is specialised in startup support from the pre-launch stage of the business to the entire duration of your business journey. Our team will ensure that your business stays ahead of the accounting perspective and that you are compliant with VAT and tax regulations in Malta.
Fairwinds Management Limited is a MFSA licensed firm offering Business Solutions in Malta. As part of our services, we offer Accounting, Administration, Corporate and Legal solutions. Fairwinds Management also manages the brands Accounting Services and Admin Genie.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.