Dear Entrepreneur, This Is Why You Need Basic Accounting Skills

Are you an entrepreneur? Do you have any basic accounting skills? If not, then you must aspire to have some or sit and watch your business venture going down. The sustainability of your business must start with you.

The best way to grow your business is to understand its financial soundness. You cannot be aloof of how your business is financially and claim to be in business.

As an entrepreneur, you must always be the first accountant to your business before delegating complicated tasks to others. Other than just knowing the numbers in your bank account, you need to know whether you are making profits or running an expensive venture.

Stats show that in five years to 2016, more than 2.2 million small-medium enterprises (SMEs) closed down their businesses. This translated to 450,000 SMEs annually and 1,000 SMEs daily. This should worry us.

The SME sector is the backbone of Kenya’s economy. The sector employs 86 percent of Kenyans and contributes about 45 percent to Kenya’s GDP.

Some of the factors that are leading to the majority of SMEs going down can be avoided. For instance, very few SMEs know how to keep records of their transactions. The majority of them do not know basic accounting skills such as defining what cash flow and general use of their cash.

Here are 4 things that you must have as an entrepreneur:

Understanding Basic Accounting and Bookkeeping

You must learn to keep proper financial records, prepare your own financials and be able to interpret simple financial statements with ease.

Master Corporate Budgeting and Budgetary Control

You must learn to prepare your own performance-based budgets, flex them and monitor their implementation and control.

Understanding Statutory Compliance: Understanding the Missing Link

You must be able to identify compliance areas that you often do not give much thought about and act to become fully compliant.

Master Effective Management Control in Business

You must master and appreciate the importance of effective management controls and implement them.

If you need to learn all the above for free, then visit ZENUHA and let them pass you through them.

This piece has been written by an expert from ZENUHA.