{"id":7981,"date":"2023-01-05T08:00:00","date_gmt":"2023-01-05T13:00:00","guid":{"rendered":"https:\/\/www.sage.com\/en-us\/blog\/?p=7981"},"modified":"2026-02-12T04:24:06","modified_gmt":"2026-02-12T09:24:06","slug":"small-business-accounting-5-steps-to-start-your-books","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-us\/blog\/small-business-accounting-5-steps-to-start-your-books\/","title":{"rendered":"Small business accounting: 5 steps to start your books"},"content":{"rendered":"
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\n\t\t\t\t\t\t\tMoney Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
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\n\t\t\t\t\t\tSmall business accounting: 5 steps to start your books\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

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\n\t\t\t\n\t\t\t\t\"\"\t\t\t\tOwen Sweeney<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t<\/div>\n\t\t<\/div>\n\n\n\n

Are you a small business just getting started? Getting started with your bookkeeping or accounting can be stressful for any new business owner.<\/p>\n\n\n\n

5 steps to start your books<\/h2>\n\n\n\n

This guide will cover the following essential steps to ensure you don\u2019t forget anything during this exciting time:<\/p>\n\n\n\n

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  1. Open a Business Bank Account.\u00a0<\/strong>Open a bank account for the sole purpose of your business. You don’t want to mix your business expenses with your personal ones.<\/li>\n\n\n\n
  2. Gather Receipts and Paid Invoices.\u00a0<\/strong>Gather your receipts and paid invoices.\u00a0 Apps, such as AutoEntry<\/a>, can help you keep track.<\/li>\n\n\n\n
  3. Enter Your Expenses. <\/strong>Our\n\n\t bookkeeping template <\/a>\n can help your keep track of the money you spent and the money you made.<\/li>\n\n\n\n
  4. Enter your Paid Invoices.<\/strong> There are two methods of recording the money you made: the cash method and the accrual method. Read this article to understand the difference<\/a>.<\/li>\n\n\n\n
  5. Double Check Your Work aka Reconciliation.\u00a0<\/strong>This last step is so important, and yet it’s often skipped.\u00a0 Compare your records with your bank statements.<\/li>\n<\/ol>\n\n\n\n

    Download your free cash ledger bookkeeping template and follow along with the video.<\/strong><\/p>\n\n\n

    \n\tGet it now<\/a>\n<\/div>\n\n\n\n\n

    Small business bookkeeping vs accounting<\/h2>\n\n\n\n

    Accounting and bookkeeping are two terms that are sometimes used interchangeably. But they don\u2019t mean the same thing.<\/p>\n\n\n\n

    So what\u2019s the difference between bookkeeping and accounting?<\/p>\n\n\n\n

    Bookkeeping is simply the process of recording all the money that goes in and out of a business. It used to involve entering information into ledger books \u2013 hence the name \u2013 but most businesses now do it using accounting software<\/a>.<\/p>\n\n\n\n

    Besides recording all income and outgoings, bookkeeping tasks also involve collecting and storing financial information such as receipts, invoices, and bank statements.<\/p>\n\n\n\n

    It involves paying bills and staff, reconciling bank statements, data entry, and paying taxes. Every business, from self-employed freelancers to major global corporations, must perform bookkeeping tasks.<\/p>\n\n\n\n

    Bookkeeping sits within the world of accounting and it\u2019s often seen as the first step of a bigger process.<\/p>\n\n\n\n

    Business accounting is about interpreting complex financial data and using it to create reports and forecasts, generally in order to understanding the financial health and performance of a business.<\/p>\n\n\n\n

    While your business is still fairly small, it\u2019s worth focusing on getting the basics of bookkeeping right since you have a legal obligation to record financial data.<\/p>\n\n\n\n

    Business accounting will certainly help in time but your priority should be to get on top of your books first.<\/p>\n\n\n\n

    Starting your books for the first time can often be a daunting task, but it doesn\u2019t need to be! With our Quick Start Guide, we\u2019ll help you get your books up
    \nand running in just five easy steps!<\/p>\n\n\n\n

    Download your Quick Start Bookkeeping Guide below.<\/strong><\/p>\n\n\n

    \n\tDownload now<\/a>\n<\/div>\n\n\n\n\n

    Looking for more Sage Advice on managing your small business finances? Check out these articles:<\/h3>\n\n\n\n