Audit Proof Your Small Business Part 1

Audits are an unfortunate fact of life for small business owners. While the chance of an audit in any given year is low, there's a decent chance that over the life of your business you'll be subject to at least one type of audit of your business records. Here are eight tips to ensure you're prepared in case of an audit: (1) choose a strategy and stick with it! Are you going to use technology, a professional, old fashion paper ledgers? Figure out what works for you and keep it up. (2) Know what to track: income, expenses, assets and liabilities. Make sure your strategy covers all items. (3) Store your information in one place. You need to keep information for at least seven years, so get organized with your documentation system, whether that's a filing cabinet or the cloud.  (4) Keep your business and personal accounts separate. If you do one thing for your small business recordkeeping, do this. Tune in next time for the rest of the tips.