Bookkeeping begins with the question “what financial information do we need to run our business?”
Because, although every business has sales and purchases and many have payroll, bookkeeping needs to be bespoke and not standard.
Financial transactions flow into financial reports and, to be extreme, if all of your costs are recorded as “general business expenses” then you won’t know how much is being spent on staff costs, premises, marketing or anything else.
And you won’t know your profit margin.
And what you don’t know, you can’t improve.
So a bespoke approach to bookkeeping from the beginning is necessary your financial information is to be useful.
Bookkeeping should also mirror and keep pace with the technology your business uses. A business that sells only online will have different requirements to a business that sells services.
But remember – technology is the servant and not the master
Having figured out what your business needs, the next question is ”how to do it?”
Bookkeeping is a continuous activity, a never-ending story, and the more up-to-date it is, the more useful it is.
Don’t be the business that only does its bookkeeping every three months, just in time for the VAT return.
Be the business with its finger on the financial pulse.
Cloud accounting software, such as FreeAgent, Xero and QuickBooks, means bookkeeping has never been more accessible and more connected to your colleagues, customers, suppliers, bank, HMRC and to your accountant.
If you’re using accounting software in-house then make sure those using it are properly trained.
And if you outsource your bookkeeping then make sure your bookkeeper / accountant knows how to use the chosen software and also has a thorough understanding of your business.
Essentially your year-end accounts should fall out of your bookkeeping software – with no surprises!
It’s useful to wait two or three months just to make sure everything has been accounted for properly and sometimes there can be events in the new financial year that need to be reflected in last year’s accounts.
Often overlooked, but absolutely essential, is that the numbers in your bookkeeping software agree exactly to your annual accounts.
Amazingly, this isn’t something that accountants are very good at checking!
Your annual accounts will contain a provision for the amount of corporation tax payable on your profits. An estimate of your corporation tax liability must be paid nine months and one day after your year-end so it’s sensible to produce your tax return at the same time as your accounts.
Accurate bookkeeping gives you a real-time picture of your business performance. It shows where your money goes and helps you make confident decisions. Without it, you’re flying blind — a bit like trying to navigate London without a map.
Up-to-date bookkeeping also makes tax compliance much easier. VAT and the Quarterly Updates required by MTD are quicker to do and easier to get right.
Up-to-date books mean your year-end accounts should contain no surprises almost take care of themselves. You’ll always know how much tax is due and when.
If you’re self-employed or a landlord, digital bookkeeping is essential for HMRC’s Making Tax Digital (MTD) rules.
Yes — and if you’re VAT-registered, it’s mandatory. Modern tools like Xero, QuickBooks, or FreeAgent save time and reduce errors. We can help you choose and set up the right system for your business.
You can — and many do. If you’ve got the time and know-how, it’s cost-effective. But poor bookkeeping is a false economy. If numbers aren’t your strength, it’s better to outsource to professionals.
Yes. Many clients let us handle everything so they can focus on running their business. You’ll still need to share invoices, receipts, and statements promptly so your records stay accurate.
Yes — a hybrid approach often works best. You can handle tasks like invoicing while we reconcile accounts, prepare VAT returns, review the numbers and produce reports.
Reports are the reason for doing your bookkeeping. They show you how your business is performing and where improvements can be made.
Make sure the right reports go to the people who can act on them and make sure everyone understands the financial reports they’re receiving.
We don’t believe in forms, we believe in talking to people, finding out your needs and tailor-making a solution just for you.
Give us a ring on 020 7125 0270 or email us at info@bluedotconsulting.co.uk
Specifically South West London, including:
“Blue Dot have been our accountants and bookkeepers since the very beginning of our business, and have been nothing short of outstanding throughout.”
“Michael and the Blue Dot team have been an essential part of our journey from startup through to being an established company, and we look forward to continuing working together long into the future. They have always been on hand to offer support and sound advice whenever it is needed.”
“I’ve been delighted with both the service and expert advice I’ve received from Michael and his team. They take the weight off my shoulders when it comes to my business’s financial requirements, allowing me to focus on building and managing the company.”
