Summary

Establishing the Business Accounting System for a new Business

Goals

To set up the Business Accounting system of this newly established business and provide a financial years data to their Accountant.

Business in Profile

This Business was established by a person working from home who had developed their own system to guide investments on the share market.  The start up money came from not only this business owner, but money also invested by a friend.  Money was added to the business as it was required.

Challenges

There was a full year of data that required processing. Most of the investment data was in American Dollars, requiring conversion according to the exchange rate on the day of the transaction.  The investment account statements were in a very complex format, involving every trade on a daily basis. There were multiple     investment accounts, about 50% of which were shared with another business person.  The owner had not kept records of any business expenses and much of the documentation was missing.  The Accountant had still not processed this persons previous year’s taxation.

Strategies

Gather all the required raw data that was available and enlist the assistance of the business owner to follow up where possible to obtain   statements, receipts etc that had not been gathered during the previous year.  Place all data into date order. Convert all money amounts listed in American Dollars into Australian Dollars.      Systematically process the data from the start of the financial year in all of the relevant areas.  Constant contact was necessary with the business owner who was required to legally validate information and provide any further information or documentation needed.

Outcome

The full financial year was completed and the data sent off to the Accountant for taxation submission.  A system was setup for the owner to keep the necessary records for future processing.  Despite since moving to the other side of        Australia, this client has retained the services of Avatar  Bookkeeping.