We’ve all either done it or know of someone who has. By this I mean starting a new business. Some have gotten into the game by buying or taking over an existing business or by buying into a franchise. Yet others have started it from scratch bringing nothing more than a skill set and, hopefully, a business plan. Regardless, even for an established business, the personal imprint of the new owner or owners must and will come into play. New owners bring a renewed sense of vitality to the business whether starting from scratch or taking over something already in existence. Exciting times!
Things would invariably start with opening a dedicated bank account (a must for new corporations) and managing the early cash flow brought in from things like personal investments, loans, the sale of shares, etc. A fresh bank account with proper signing authorities is pretty much a given. With this may come the need to set up credit cards, lines of credit and other means of moving the money around. If staff are to be involved from the get-go, a means of paying them must also be in place or established quickly. The financial side of things is only the beginning.
For what it’s worth, my advice from having dealt with the books for many startup and young businesses is to keep the finances between business and personal as separate as absolutely possible. It is possible to keep track of it but history shows this to be a difficult thing to do at best for most business owners. Many owners and managers have run afoul of Revenue Canada by poor accounting between business and personal. We can help with this.
The myriad other things that may or may not come into play in the early going could include such things as:
- Picking a suitable and allowable location to set up shop for the kind of business being undertaken
- Making sure all necessary permits are in place
- Setting up suppliers and bringing in inventory
- Setting up an office with phones and other necessary services and supplies
- Hiring staff if this is vital to the startup or early functioning of the business
- Taking care of advertising to let the world know the business is open or about to be
- Setting up and managing all things internet including websites, email addresses, social media sites, etc.
The list goes on and on with the above points only scratching the surface. I haven’t even discussed the unique things that the business is created for, set up, and ready to take care of. Needless to say, the early life of a business is anything but boring. With a bit of luck, the new owners will have help in getting everything up and running. It makes sense to enlist the assistance of professionals that can take care of things that there isn’t the time, staff or expertise to deal with it in the early going. This is where we at Fiscal Performance can be of service.
One of the upsides of getting the books set up and taken care of from the get-go is that they can reflect and help manage the finances of the business when things are still relatively simple, straight forward and under control. A mistake we have seen all too often is the neglect of the books right from the start. This leads to stressful catch-ups and cleanups when government, banks, investors and others come looking for answers and money. A clean and up-to-date set of books can remove this stressor and also give an ongoing report on how the startup is proceeding and how the money is holding up.
If you are involved in a startup or know of someone who is and could use some assistance with the accounting end of things, I’d be more than happy to have a look and advise on what we can do and what we have to offer. All it takes is a connection to get the ball rolling.
May you be enjoying all that summer has to offer.