Bookkeeping refers to making a record of the monies received by a business as well as the monies paid out. It encompasses money a company owes to vendors, employees, tax agencies, contractors and any other individual or entity. Likewise, accurate records of amounts owed to a company by outside individuals and organizations are also recorded in a company's books. In layman's term, it is simply keeping track of the money that comes in and the money that goes out.
It is always a very good idea to properly manage your financing and implement effective small business finance accounting system right from the moment you start your business. When your business grow, you will realize how easy it is to handle your financing because you start your financing management the right way.