‘Proper Accounting System will Boost SMEs’ Access to Loans’
Taisha Associates, an accounting and management consultancy firm, has said that small and medium scale businesses that need finances for expansion from banks need to have proper bookkeeping methods.
The Managing Partner, Taisha Associates, Taiwo Popoola, said this during a virtual event while making a presentation titled ‘ABC of effective bookkeeping for MSMEs’ on Wednesday
He said, “Thinking of expanding your business? If you need financing of any kind, having well-kept books gives lenders or investors a clear idea of your business’s current financial state, and allows them to make financial projections about your company’s ability to pay off your loan in the future.”
To track business finances effectively, he said it was important to permanently separate them from personal finances.
He also urged the entrepreneurs to choose a bookkeeping system, categorize, organize and store documents transactions.
The financial expert said that if the bookkeeping duties were getting bigger, the SME could hire a professional to handle it.
According to him, proper bookkeeping helped to detect banking errors on time because if the SME waited until the end of the year to reconcile his financial transactions, he may not know if the bank made a mistake on the account and it would be more difficult to reconcile an overcharge with the bank months later.
“Bookkeeping is the process of tracking all of your company’s financial transactions, so you can see exactly where your business is spending money, where your revenue is coming from, and which tax deductions you will be able to claim,” he said.
Paying attention to financial statements was a great way to assess the growth of the business, he said.
Source:(Nike Popoola for Punch Nigeria)