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How to Make MSME Financial Bookkeeping Easy and Fast

For MSME actors, recording business income and expenses and monitoring business development can be done by keeping financial books.

One of the most important business activities that must be carried out by business actors is financial records. This part is often forgotten, so many business people don't know whether their business is profitable. It's a good idea to find a way to get your financial accounting up and running quickly.

No need to get too complicated. The financial records that you keep must include records of expenses, income, and stock of goods that are still available in your warehouse. Then don't forget to make a profit and loss report to see how your business is progressing.

Learn how to make financial accounting for Small and Medium Enterprises (MSMEs) a key factor in the success of your business. Here's the review that we will give you below!

What is Bookkeeping?

Finance is one of the main problems faced by many MSMEs in Indonesia. The reason is that MSME owners lack the ability to manage company finances, resulting in not recording the company's financial income and expenses clearly and regularly. As a solution, you can start with bookkeeping.

Bookkeeping in this context refers to simple financial bookkeeping or the activity of recording the day-to-day business operations to measure business growth and profitability.

This simple record can have a big impact on business development, because it allows us to know the situation and development of the company, including the company's profits and losses. Bookkeeping serves as a yardstick for shaping future business strategies.

The Benefits of Doing Bookkeeping for MSMEs

Business Evaluation Material

One of the benefits of small business bookkeeping is that it can be used as a business valuation tool. Bookkeeping allows you to measure the success of the company. The trick is to look at the number of items sold. You can calculate the number of product sales from the amount of deposits and withdrawals.

If you want to know the financial transactions of your business, you need to make a business book. Can be used as an appraisal tool and as business evaluation material, using clear bookkeeping as a document for all types of financial transactions.

Know Transaction History

The next advantage of MSME bookkeeping is as a tool to find transaction history. You can record your business transactions by creating a ledger. Bookkeeping helps to record in detail all transactions within a company. 

This allows you to easily monitor the number of incoming and outgoing transactions and not worry about missed transactions. Business processes run smoother when they are well organized and clearly laid out.

Knowing Profit and Loss

Knowing the pros and cons is an advantage of small business bookkeeping. Choosing the right steps to manage your business finances can be difficult if you don't know the advantages and disadvantages. 

For example, if your business is profitable, you might be able to push more promotions to attract more customers. On the other hand, if you're losing money, you may need to cut advertising spending so that your business capital isn't being strained.

How to make MSME bookkeeping 

Maintaining financial bookkeeping for MSMEs is actually not complicated. As pioneers in your business, we recommend that you keep financial records of your company from the start.

Large companies usually turn over their financial records to professional and experienced accountants who can be hired to do the bookkeeping. However, for those who are just starting a business, cash flow calculations can be done alone.

Here are some tips for compiling financial books for MSMEs who are just starting a business.

Collecting All Daily Transaction Evidence

Proof of transaction is the first step you need to take. Proof of transaction can be Well, invoice, or a receipt from an EDC machine. Digital wallets can also be used for many transactions. So don't miss proof of that one transaction either.

Evidence of this transaction must also be original and can be read clearly starting from the amount up to the transaction amount. This makes it easy to start bookkeeping later.

Separating Expenditure and Income Bookkeeping

The next step is to record your daily expenses and income. However, these financial expenses and income must be recorded in separate accounts. In fact, there are still many economic actors who record their income and expenses directly in the spreadsheet. 

Maybe this type of recording is a bit more practical. Unfortunately, recording income and expenses directly in accounting only increases the risk of miscalculations and double posting at a later date. By keeping various records, there is no confusion in determining whether the transactions that occur are income or expenses. Please date each note and verify the transaction receipt at face value. 

Record every transaction, even the smallest. Try to record your expenses and income after working hours every day. Make sure no transactions are left behind or forgotten.

Create Key Cash Flow Records

After separating income and expenses, the next step is to combine the data into a cash flow dataset. You need to create a cash flow record with two columns, debit and credit. The debit column shows incoming payments and the credit column shows outgoing payments.

More Coverage:

Add a balance sheet column to the right or bottom of each book. In this way, you can find out the financial situation of the company that is being implemented. Credit score shows whether you lose or gain.

Create Stock Items and Inventory

Financial bookkeeping is also related to inventory. These items are used to start production for sale. Therefore, we need to know which items have been released and which inventory has been upgraded. 

In addition to inventory, inventory must also be recorded. This inventory includes assets, grants, and contributions from other parties. In this way, you can monitor all commodities in your company.

Make a Profit and Loss Report

An important bookkeeping step that must be carried out is the preparation of an income statement. This report allows you to see the financial status of the company being managed. After making a profit, you can see the total net winnings you received.

This income statement should also be prepared to monitor the use of capital during the period. From this income statement, you can also see the debt obligations that you have to pay. Then you can start determining a new strategy for the next period.

Knowing how to make a small business financial book above will help you manage your finances better. Hopefully the above article can help you manage your finances from the business you are currently starting.

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