What is bookkeeping?
Bookkeeping is the process of routinely documenting a company’s financial transactions. By keeping track of all the information in the books, bookkeeping assists with operating, investing, and financing decisions. People that manage all of a company’s financial data are called bookkeepers. Without bookkeepers, businesses would be unaware of both their current financial situation and internal transactions.
Importance of bookkeeping
Bookkeeping helps the management in getting an idea about the following matters:
- How your company is doing in terms of finances
- Where it is spending extra and where it is spending less
- How it can save money
- How it can generate more revenue
- Which department or operation needs more money
- Effective means to manage your taxes (VAT)
- Reliable measure of performance
- Provide information to make general strategic decisions
- Benchmark for its revenue and goals
Common signs that you need bookkeeping services
Bookkeeping services in UAE plays an important role as a result of increased number of companies. Below are some common signs that you need to hire a bookkeeper for your business:
When your books are out-dated
The most crucial factor is that your books must be current in order to gain a sense of your financial status. If your books are out of current, they will display outdated material and could lead you astray. In this scenario, you need employ a bookkeeper for your company to ensure that all financial records are constantly updated.
When things get rushed during tax season
As a company, it is your obligation to pay corporate tax at the end of each year and as per the new laws, you are also required to charge VAT. For the purpose of calculation of taxes, you need to access your books of account. If at the end of the financial year, everything gets rushed, then you need to hire a bookkeeper to avoid the rush as well as any inaccuracies that involved in it.
When you have no idea about your cashflow
A business has a constant flow of cash coming in and going out. You should create cashflow statements if you want to understand your cash situation (that is, how much cash you have coming in and going out).
If you don’t have access to someone who can prepare a cash flow statement for you, you might only have a very vague sense of your cash position, which could be bad for your company. Therefore, in this circumstance, you must employ a bookkeeper for your company.
Poor technology
If you use your own systems for bookkeeping or accounting purpose, there are chances that you may not be using the right software or updating your systems. If you hire a bookkeeper, you can be assured that the right technology is employed to handle your finances, which in turn means accurate and timely results.
From the above, it is clear that bookkeeping services in Dubai is necessary for any business. So, before any problems occurred, you need to hire a bookkeeper who can keep your books in a systematic manner.
