Why Are Accurate Financial Records Important for Businesses?

Business owners need to keep track of a lot of information, and staying up-to-date with financial records is an important part of that. Accurate financial records will help you understand the health of your business, and will also make it easy to ask the bank for a loan if you’re thinking about expanding.

Make sure you keep the following financial documents up-to-date:

Income Statement
An income statement shows the performance of your business during specific accounting periods. It includes your sales revenue, cost of goods sold, and expenses, and shows your profit and loss.

Balance Sheet
Your balance sheet summarizes all of your assets, liabilities, and equity. This is an important document to give to any lenders or investors when looking to get a loan. Your assets could include cash, accounts receivable, and your inventory. Liabilities include accounts payable and any long or short-term debt you may have. Equity includes stock or retained earnings.

Cash Flow Statement
Plain and simple, a cash flow statement shows the cash flow in and out of the business. If you have interested investors, this is a financial document they will want to see. A cash flow statement is transparent and shows the true performance of your business.

Here at Ryder & Company, we can provide you with all of your bookkeeping needs, including preparation of the above statements. If you are looking to outsource your bookkeeping needs, contact us today. We would be happy to talk to you about all of our business services.

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