We will begin by explaining minimization. Minimization means that it was reduced down to something tiny or insignificant. Minimization is different from organizing minimalist. Although minimalists put a value on keeping what is most important to them and are somewhat on the right path to avoiding hoarding. However, function is what we need and if we do not have what we need to function and produce efficient and productive results then we have eliminated too much. I can have a home full of the things I use and that would not make me a hoarder. A hoarder collects things out of fear and the spirit or obsession. So how does this apply to bookkeeping?
I wanted you to first understand that I am not speaking about minimalist but minimizing. People use minimization to reduce something down to something less than basic. Did you know that simply derives from the word simpleton? A simpleton is not a good thing to YAH. We are living in a society where people love to skip steps. "What is the easiest way?" Is the number one question that I receive and staples did not help with the "easy" button. I am not saying all things need to be complicated by no means but there is a difference between easy and simple. There is a difference between easy and incomplete. Steps are involved in building anything of worth that you would like to sustain. Having or gaining knowledge takes wisdom. The same thing with bookkeeping.
Since we confuse easy with simple people skip steps. Easy is what happens when you get a routine (foundational processes) down. Routines get us into what we call the "flow" as it just becomes part of your day or the process. Meaning it becomes a workflow and therefore it becomes easy. Have you heard the saying, "Keep going it will get easier?" Yes, that saying does not go, "oh well, if it is hard cut out steps." Most simpletons do not want knowledge or wisdom but those that want to come out of the state of being a simpleton do. YAH says, "The unfolding of words will give light to the simple." YAH references building as he laid the foundations in Genesis 1. YAH goes on to reference building, setting roots, and setting foundations all systems that take root or a firm standing (KANA) multiple times. I will share that on another blog.
Bookkeeping is "simplified" to tracking receipts and data entry." While bookkeeping is more than this process. Data entry on the front end of operations automatically creates bookkeeping and the correct name for this process is called using your tools for business management. Such as creating a bill before payment is due is monitoring payments. On the front end, new bills are entered in or scanned in and then added to the software beforehand not after you make the payment. Once the payment is made the bill is updated with the payment and is updated in the bank that is paid through. The banks are added in to download the transactions that match to the operational process. Learn more about this process on this blog: "Automatic" Bill Payments
Most people get their bill via mail and that is fine but that sits on their desk until they make payment. The bill may get lost over time and especially if it is auto-debited or drafted from the bank. The bookkeeper never gets the full paperwork needed. What happens? People want the bookkeeper just to add it in" using the downloaded bank transactions. The information does not reflect properly under the accounting reports for the profit and loss statement and the balance sheets. Also, if the purchase pertained to inventory the inventory numbers are impacted as they are correctly updated. Soon I will have my training guide available for inventory management to assist with this process. Bookkeeping is not the action of recreating past events. Bookkeeping is the process that occurs from the front in accounting processes more commonly known as business management. Learn more about implementing accounting into your business.
Today bookkeeping is looked at as an after-the-fact recording process. Operating in business and then hiring someone to catch up and update the books. Business owners can hire businesses that will cater to this process and business owners look for people that "fill in" the holes. Most people think the bank account is enough information so with software developers leading people to think all they need is to link their bank that is it and they can set automatic rules and go. Did you know you still have to follow up? Do you know you will need to match your bank downloads to the front operation tasks? Most people do not even think they need up-to-date books to do taxes when they own a business. Accurate accounting records lead to better tax estimation and planning that creates a better outcome on taxes or it gives you the ability to prepare payments as in savings. Bookkeeping is the result of optimized accounting business processes that help you create an accounting process to best steer your business. Soon you will see that bookkeeping is more than collecting receipts. Accurate books are the result of optimized accounting business processes.