Keeping Track of Dollars Makes Sense
Best Bookkeeping Practices for Visually Impaired Entrepreneurs
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Keeping Track of Dollars Makes Sense
Tom and Susan have a small family web design business
that is off to a good start in spite of being little
more than a year old. The couple launched it on a
shoestring, using just the somewhat-elderly computer
they had and contacts in small businesses Tom had from
former jobs. The simple elegance of their designs and
their reasonable prices have already generated several
clients for them. Now that they have had a taste of
success and know they have a viable business, they are
realizing that, in their early, tentative efforts, they
skipped many of the steps a wise entrepreneur often
takes at the outset.
Tom and Susan are worried about the statistics. They
have heard that as many as 80 percent of new small
businesses fail. They know there are several reasons
for startup failure: lack of business know-how, too
little money from the start, lack of attention to the
bottom line and problems with cash flow.
But they also know that a key component in business is
keeping track of the money that comes in as income and
the money that goes out as expenses. In addition to
needing this information to satisfy government
regulations and taxes, "Poor bookkeeping will prevent
you from being in control" of such important elements
of business as healthy growth and responsible allocation
of resources, according to the Australian Small Business
Network.
Neither Tom nor Susan was certain how to begin
building a sound bookkeeping system. Since Tom is
totally blind and Susan has low vision, they were also
concerned about how they would keep track of the bills,
invoices, receipts and all the other financial details
of a small business. But they did their homework. Here
they share 10 "best bookkeeping practices" they've
developed while doing their research and running
reality checks on what they found through their own
enterprise.
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Best Bookkeeping Practices for Visually Impaired Entrepreneurs
Here's what works best for Susan and Tom:
- Keep separate financial records for your
business. Tom and Susan could have chosen to form a
business partnership, but they elected to take
advantage of being a married couple to set up the
simpler sole proprietorship status for their web design
business. Although in most countries income from a sole
proprietorship is considered personal income, it is
important to maintain separate personal and business
financial records.
To keep financial matters relating to your business
entirely separate from your household finances, open
one checking account in your name and another in your
business's name. Deposit all monies received from
business activities and pay all bills related to the
business out of this account. While you may hesitate to
pay the extra business checking account fees, separate
accounts are important for your future success.
- Try not to "co-mingle" business and personal
purchases on the same credit cards. Consider getting a
separate credit card for business use, either in the
business' name or in your own name. This is important
for record-keeping purposes as well as for allocating
interest charges and other credit card fees to the
business.
Tom and Susan applied for a separate business credit
card and used it to purchase a newer computer and set
up DSL for their Internet use.
- Separate assets, including all property and
equipment, you use in your business. Again, for record
keeping and accounting purposes, it is important to
separate non-monetary assets as much as possible.
Consider setting up a separate telephone line for your
business calls. (It will also add an air of
professionalism to your operation if your kids don't
answer this phone.)
As much as possible, your office equipment (computers,
copiers and other equipment) should be dedicated for
business use only. At a minimum, you will have to
determine what percentage of the time you use a given
asset for business use. The rule of thumb here is that,
if you intend to deduct expenses related to use of your
equipment from your income for tax purposes, you will
need accurate records.
Tom and Susan decided to use their new computer for
business only and the old one, with traditional dialup
Internet access on it, for personal pursuits. Since
their communications are all done by e-mail, they
elected not to get a second phone line and do not
factor telephone expenses -- other than the DSL access --
into their business expenses.
- Get and keep receipts for everything you buy
relating to the business. Try not to lump them together
with personal purchases. Doing this can be as easy as
going through the checkout line twice: once for the
personal things and another for the business things.
Tom and Susan are careful never to use their business
checking and credit card accounts for anything but
business. They don't add even a pack of gum to the
basket.
- Remember that you can deduct the costs for adaptive
equipment or services (such as a reader) you use for
business purposes. Again, keep all receipts relating to
such expenditures. Susan decided she is going to
purchase a CCTV to help her with graphic design and
will be sure to track it as a business expense.
- Check your insurance coverage. Your homeowners or
renter's insurance may not cover you for business-
related activities. This is especially important if
clients or customers come to your home. The same is
true with your health insurance; it may not cover
conditions arising from your self-employment.
Read your insurance contracts, or check with your
agent. You may have to get separate insurance to cover
your occupational activities.
No client will set foot in Tom and Susan's home, so
that type of coverage may not be necessary. However,
they have purchased supplemental insurance to cover
their business equipment and are looking into whether
their health insurance would cover such occupational
hazards as repetitive strain syndrome.
- Keep your accounting system simple. Accounting for
your business activity need not be a complicated
affair. A simple double-entry journal in which you
record income (debits) and expenses (credits) may be
all you need. You will, however, need to be able to go
back and "summarize" your expenditures and income by
categories (consulting fees, postage, office supplies
etc.). Make sure your journal entries include
sufficient descriptive information so you can identify
each expenditure later on. You should also have some
documentation (such as receipt) for every entry in the
journal.
Neither Susan nor Tom can see well enough to use a
paper journal. They found accessible software, however,
that will do the job. See the next section under
"Bookkeeping Software."
- Familiarize yourself with the tax requirements for
the area in which you live. In some cases, you may have
to pay your taxes quarterly or twice a year to avoid
penalties. Don't be tempted to underreport income or
overstate your expenses. Tom and Susan learned this the
hard way when April 15th, tax day, rolled around and
they were penalized for underpaying their quarterly
taxes.
- Keep your paperwork organized. This includes any
licenses or permits, tax information, business
correspondence and receipts. File these in a safe
place, organized in some logical fashion such as by
date. You can purchase accordion folders with separate
compartments for each month. Before filing each item,
Susan puts a large print and Braille label on it so
either she or Tom can easily find it.
- Keep your bookkeeping up-to-date. Use a calendar or
calendar program to set reminders for yourself to post
income and expenses to your journal. Make sure that you
include any required filings of taxes or other
documents.
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Find the Tools That Work for You
Since Susan's vision is low enough now that she can't
rely on print or handwritten records and since Tom
wants to share the bookkeeping duties, they have been
searching for accessible tools to track their income,
expenses and other financial performance measures. Here
are some of the simple methods and high-tech tools they
found.
The Bank
In the United States, all banks and other financial
institutions are required to provide blind
accountholders with accessible checks and check
registers. Checks, for instance, come in large print
and with raised lines. Sometimes bank personnel will
not have been well trained about this, so, if you are
dealing with an employee who is not informed, ask to
see a manager. You can also check the bank's web site
for any information.
Susan had to bring a printed copy of the accessibility
section of her bank's web site to educate the staff
about the raised-line checks she and Tom use. These
checks generally come with a large print register. They
are also available at most low-vision aids stores.
TravelVision reports, "The Deluxe Check Company, one
popular check printing company, makes large print
checks and deposit slips available to partially sighted
customers. Check your bank's product line to see if
they offer a series of checks and deposit slips in
large print, high contrast and with tactual cues
indicating the areas to be filled in."
In addition, most low-vision stores carry paper or
plastic templates to place over checks. This option
would take care of both Susan and Tom's needs, if they
had not found acceptable checks.
Kirsten Schmidt at the McDowell Center Low-Vision Aids
Store added that many blind people she knows use audio
tape to record transactions. They record check numbers,
payees, amounts, dates and notes about the purchase.
ATM access is improving. Tom laughs about the Braille
on the one at his bank. The Braille, he says, doesn't
help him with what's displayed on the screen.
"(Talking ATM) technology will give voice instruction,
via headphones, to users who cannot read information on
the ATM screens. The ATMs will have audio jacks to
deliver voice information privately to protect the
security of users," according to Center for Accessible
Society. Such machines are growing in number. Contact
your bank and ask whether it will have talking ATMs
soon.
Bookkeeping Software
The traditional paper ledgers and journals available
from any stationery store are not an option for Tom or
Susan. They checked into ordering large print ledgers
or having very large print journals made for them but
decided that the expense was not warranted, since there
were less expensive alternatives and ones Tom could
use, too.
For most small, home-based businesses, the
spreadsheets that come with popular office software
packages are sufficient for business use. One caution,
however: Make sure you set up the spreadsheets to do
calculations properly. An incorrect formula can cost
you a lot, both in money and grief.
There are also numerous small business accounting and
tax preparation software packages that simply ask you
questions and then prepare the books and forms
automatically, such as Quickbooks, one simple question
and answer bookkeeping application that does the
sorting and reporting for you. But, as for
accessibility, Lan Nguyen at SightConnection.com in
Seattle reports that Quickbooks is not very popular
with the JAWS for Windows user.
Ken Gould, who has a high-end audio/video business
called Audio Nexus in Summit, N.J., says QuickBooks is
very unfriendly to blind people, and only extraordinary
efforts can make it work for them. He says it's very
difficult to use with any screen reader and is
impossible to script or configure for general use.
Having said all that, he adds, "it is possible to make many important parts of QuickBooks work for you.
I know this because I had to do it for my business, and
I have, in fact, succeeded. However, it is a difficult and
challenging task to say the least, and it requires an
advanced knowledge of scripts and frames."
Steven E. Marks, a blind accountant at Maid To Clean
in Warsaw, Va., is more encouraging, however. "The
accessibility has improved greatly with JFW 3.7.
Version 3.7 is designed to work with Quicken 2000 and
this carries over into Quickbooks," he says. "After
labeling the graphical radio buttons and the check
boxes, JFW will read very well after you learn the
program. You will also need to be very efficient in
using JFW."
Other software, such as Quicken, PeachTreee and Simply
Accounting, receive the same mixed reviews. One of the
best ways to get a sense of how well a certain product
will work for you is to join an online discussion
group, many of which are on Yahoogroups, for a specific
accessibility software and then search the group's
archived messages and post specific questions.
In any case, Gould recommends getting a good
accountant (perhaps one who also helps you with your
taxes), who will explain how to set up your bookkeeping
system when you start your business. That can save you
a lot of extra work and grief.
Other Bookkeeping Tools
Calculators and adding machines are readily available
with large print or speech output. Your computer
already has a built-in calculator. Check the
Accessories directory in Programs. I found SmartSum, a
free calculator/adding machine application which has
printing ability for download at Freedownloadscenter.com.
That site also has other business and accounting
applications as shareware or freeware, giving you the
opportunity to try each with your own accessibility
software. Look for calculators at any low-vision store
or via the Maxi-Aids or Independent Living Aids catalogs.
The Small Business Administration web site has
numerous business forms, including tables, about how to
calculate depreciation of business equipment. It also
provides downloads for financial shareware.
Tax forms are available in electronic form, such as
software. You'll need to do the same type of research
about obtaining the right accessible tax forms as
getting the right accounting software often requires.
Susan and Tom decided to use a combination of their
state's online business tax reporting forms and the
IRS's PDF versions of its forms, which can be accessed
with screen magnification and optical character
recognition (OCR) software. The couple does not sell a
product, but, should they at some later date, there are
similar sales tax reporting tools as well.
The Internet in general is a great source of useful
forms. But, says Neal Williams, CEO of CORDA
Technologies, "The valuable information contained in
charts and graphs can't be understood unless that data
is converted from graphics into text form. We are
pleased to be the first company to provide this
valuable functionality so that those with visual
impairments can have the same opportunity to utilize
the potential of the Internet."
Not to be underestimated in importance, filing systems
are as vital as they are easy to make accessible. It's
important to keep everything -- invoices,
correspondence, receipts, bills and checking account
information. Organize it well so you can lay hands on
any one item, if called upon to do so. Here are some
easy adaptations:
- Mark every receipt, bill, invoice or other
business-related item with a large point, Braille or
recorded note with the date, amount, nature and source
of the transaction. Can Do Recorder cards from
Independent Living Aids can be stapled to items.
- Buy one or more accordion files from an office
supply store and decide how you will organize your
papers: by month, by category, by client etc. Use
large print and/or Braille to label each compartment of
the file.
Be downright obsessive about keeping the papers
filed. The more you let it slide the more likely it is
that a slip will not be identified in a way you can
read and will be of no use to you.
Tom and Susan are well pleased with their efforts to
get their business finances in order. They've been
working on their system for a couple months and find
that it all runs smoothly with a commitment to keeping
it current. They can relax now, knowing they have
accurate and timely information for evaluating how well
their web design service is doing and complying with
all local, state and federal government requirements.
Now they can concentrate of doing their web marketing
and design, confident that they have the financial part
of their business under control.
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