Keeping business records

Good records help entrepreneurs and managers know how a business is performing. A couple of readers have asked me to advise them on appropriate software they can use to keep financial records for young or start up businesses. Here are a few things you can do.

Customer information
The basic accounting software should enable you to record the name, address and contact person for every customer you deal with. If the customer is local, that is Ugandan, recording their Tax Identification Number is also important. The invoices issued, and payments or deposits received from the customer are important details. It is good to match every payment to specific invoices so that you can later tell which invoice(s) still has outstanding balance.

Supplier information
You should record the name, address and contact person for every supplier. You need to record the Tax Identification Number (TIN) for Ugandan suppliers. Finally, you need to maintain information on every invoice issued by suppliers and payments made to the supplier. Note that it is advisable to match each payment to specific invoices so that the accounting system can produce a proper statement for the supplier.

Cash information
Your accounting system should help you tell how much money you have at hand or in the bank. The cash record in the accounting system should help you to reconcile with your bank statement.

Non-supplier payments
The accounting system should help you record payments to employees and government entities such as the tax and social security authorities.

Other records
Other important records you need to maintain are money from or to shareholders, fixed assets and trading stock.
The accounting software is supported by documents such as cheques, receipts, invoices and contracts. Some of the documents are produced by the business while others are got from outside the business.

James Abola is a business and finance consultant.

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