Record keeping: What you should keep, How to keep and for How long to keep records?

Record keeping: What you should keep, How to keep and for How long to keep records?

Recordkeeping is quite a complex as well as a tedious practice. Though, it is an imperative part of every small or large business. You need to invest time and resources in record keeping. When you don’t handle the bookkeeping precisely, it can lead to multiple errors, such as – risk mitigation, future planning obstacles, and fines. 

Record keeping is beneficial for your firm because: 

  1. It helps the company to monitor its development, so it becomes ready to settle on excellent decisions.
  2. Allow the business to meet its compliance deadlines. 
  3. Ensuring better cash flow management. 
  4. Enable them to show their monetary situation to banks or different loan specialists.

What business records you must keep? 

As a bookkeeper, it is your duty to keep records of your company. The types of transaction record you store relies upon the tax responsibilities of your firm and the structure of your firm, whether it is Sole Trading, Partnership, Trust or a company.

As per the guidelines of the Australian Taxation Office: 

  1. The records of firms can never be changed and have to be stored in a manner that restrains the data from getting altered or the record maligned. 
  2. The firms are obliged to save most records for a 5 year, beginning from when you arranged or acquired the records, or finished the transactions. 
  3. Firms must show the ATO their records whenever they request them. 
  4. The records have to be in English or ready to be effectively changed over to English.

How can a business keep records? 

The ATO always advises the business to store and prepare their record in electronic form. Because of the continuous trends emerging and new policies regarding taxes, keeping records electronically makes processes less complex for businesses. Also, using electronic tools for bookkeeping purposes can save time and money. 

When utilising accounting software for bookkeeping, the ATO doesn’t ask for paper copies unless a specific principle or regulation demands one. 

The ATO also keeps all the copies in its highly-secured and encrypted storage systems. These electronic copies of records are verified and true.

The businesses must make sure that they record everything in a safe place and conduct a timely backup. For these purposes, business owners can leverage cloud-accounting technology. With cloud storage, your employees can access the data anytime and from anywhere. 

For how long, you must keep records? 

As per the ATO, a business must keep records for at least 5 years. Various times you should hold the transaction records for more time because of multiple reasons, like – if your business had a capital gains event. 

You know ATO also offers an app named “myDeductions”, that makes the recording of income and expense transactions safely in one place. You can also use different accounting software like – XERO and QuickBooks etc. 

How Outbooks can help? 

Businesses have to shift towards a more advanced record-keeping approach in order to keep up with emerging trends and government compliance. The Australian Taxation Office frequently introduces different policies to support small or medium-sized businesses. 

When you hand over your accounting and bookkeeping work such as – payroll management, tax filing and boring data entry, you can get more time to focus on important client satisfactory tasks. Our expert team will complete all your bookkeeping tasks on-time with accuracy and provide you with the best results. 

Have some doubts? Reach out to us at

Contact number: +61 861182913 &

Email: [email protected]

What are the benefits of lodging transaction records on time?

What are the benefits of lodging transaction records on time?

When you have a proper framework of record-keeping and lodging transaction records on time, it provides few advantages like improving productivity, better risk detectability, and guaranteeing consistency. A record-keeping system permits businesses to ensure their staff has total admittance to exact data in a convenient and financially savvy way.

Financial reports detail a business’ cash flow management and its monetary wellbeing at a given time. In this way, if you want the data to be helpful, it needs to arrive at the client on schedule. Clients of bookkeeping data need their financial reports as soon as possible to guarantee that their monetary choices depend on refreshed and exact data. 

Just picture the issues of late data presented to the clients were good financial sponsors or the government that required it immediately. Obviously, they both won’t want to see your month-old financial statements to understand the value of your firm. 

Also, during the covid time, the Australian government gave many grants to numerous sectors of the economy. Various firms could’ve taken advantage of this opportunity but just because they did not lodge by the due date, they couldn’t cherish the opportunity. 

The Australian Taxation Office has the rights and authority to put an FTL (failure to lodge on time penalty). 

Let’s take a look at some benefits of lodging record-keeping on time in Australia. 

Better cash flow management 

The primary justification to lodge transactions in time is to guarantee you have a good look at your daily cash flow. No one at any point needs undesirable expenses and this incorporates your clients too. While paying fixed monthlies or one time instalments, your record-keeping must never be more than what you anticipate. With correct bookkeeping, you guarantee transactions are right and don’t bring any issues. 

Government Compliance 

The ATO is quite strict about its compliance requirements. You have to be very careful while lodging your tax returns and other things. When you record every entry daily, weekly or monthly accurately and file tax returns before the deadline and strictly adhere to the government rules or regulations, you will be able to run your business smoothly. 

Save your expenses

Recording transactions on time can help you to streamline your business workflow and enhance your ROI massively. You should record each transaction and make sure the invoice has been generated for every transaction with the correct amount. Payment of clients must be recorded precisely to avoid any errors and wrong forecasting. 

Excellent financial decisions 

As a bookkeeper, you must provide accurate records of your business to the decision-makers. It helps them in making better choices for the future of business and helps them remain competitive in the market. Also, potential investors, shareholders and financial institutions rely on these records so when you don’t give them the right data on time, how can you expect them to make an investment in your business? 

How Outbooks can help? 

The significance of recording every transaction must not be belittled by a business. In the past few years, more and more accounting firms have started giving their tedious tasks to outsourced bookkeeping agencies. The team of Outbooks is glad to give guidance with precise and proficient bookkeeping services for all accounting organizations. 

Call us today at +61 861182913 or fill in our form to learn more about outsourcing accounting services. 

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