Let’s face it—as a designer, bookkeeping will never be the most exciting part of running an interior design firm. However, it is one of the most critical elements to grasp if you want a financially secure and long-lasting business. Having a solid understanding of your firm's accounting and financial functions is a defining factor that can set your business apart in the interior design industry.
While bookkeeping can be complicated enough, combine it with your unique needs as an interior designer, and you can quickly feel frustrated or overwhelmed. In addition, generic bookkeeping software doesn't always have every tool you need, leaving you searching for new tactics or additional software to manage your clients and staff.
Take a deep breath! There are ways to manage interior design firm bookkeeping, and it's much easier than you think. Continue reading and discover our four solutions to take the stress out of bookkeeping.
1. WORK WITH AN ALL-IN-ONE SOFTWARE
To efficiently manage your books, you need software that can become your ally. Having all your financial needs addressed in one place gives you a holistic view of your business and its fiscal situation.
This "dream software" might seem too good to be true, but it's available to you and your team right now. It is now possible to manage all the project-level information and functions in the same system as your business expenses, tax reporting, and financial statements. When you think about it, it makes sense for both sides of an interior design firm (project management and accounting) to be managed within one system because, naturally, they feed into each other.
With an integrated system, you can manage proposals, invoices, purchase orders, and company reports from the comfort of one program. And because all of these business functions exist in one system, it ensures minimal data entry, as there is no need to enter the same data multiple times across different systems.
For example, suppose you have the ePayments feature setup, and clients use this function to pay you online. In that case, these payments will automatically register within DesignDocs and post to the accounting side of the system. This ensures that all your financial reports are accurate and up-to-date. Better yet, if you have received an overpayment, the excess will automatically be placed on account for future use. Likewise, if you have received an underpayment, the remaining amount will stay in the invoiced items screen for later.
Having information like this presented in real-time is crucial for good bookkeeping operations that allow your business to thrive.
2. STAY ORGANIZED
Lax or negligent bookkeeping can hurt your business, from audit risks to over or undercharging clients. Staying organized helps simplify the bookkeeping process for interior designers. If the books are unorganized, your business is less likely to grow and run smoothly.
A practical way to stay organized and take the stress out of bookkeeping is by incorporating routine accounting functions into your business-as-usual tasks. For example, bank reconciliations are an essential step in the accounting process. If you're reconciling at regular intervals, it is a much easier and stress-free process in the long run.
Whether you handle your reconciliations or your bookkeeper handles them for you, DesignDocs makes the process pain-free. Error amounts shown in the reconciliation summary make it easy to see if an amount that appears on your bank statement has not been recorded in DesignDocs (i.e., bank fees, etc.). In addition, the reconciliation summary means incorrect vendor payment entries can't go unnoticed.
Another vital element of good bookkeeping practices is ensuring your data is kept safe. Utilizing robust cloud-based software for bookkeeping ensures that all your files remain backed up. However, don't just assume your software provider takes care of this; we recommend you ask about the practices they employ to confirm your data is secure.
DesignDocs is a cloud-based system; therefore, we employ a system-wide data backup strategy that continuously archives the entire database, plus twice daily complete data back-ups. All data is backed up and stored on a remote cloud-based server with multiple layers of security for added protection. Read more about the security and backup measures across all areas of DesignDocs here.
3. IMPLEMENT ITEM-BASED ORDER TRACKING
Reading this, you might first ask, "but how does item-based order tracking help me with bookkeeping?" The answer is simple with DesignDocs. If each of your projects consists of various items, you can begin to imagine projects systematically and logically. Whether those items be soft furnishings, millwork, installation, or professional fees, they are all added to a project's item management screen and become the project itself. From this item management screen, it's effortless to move the project along. You can easily add items to a client proposal, raise purchase orders with vendors, invoice clients, and keep track of paid and outstanding items. In this way, an item-based order tracking system is a reliable method of ensuring that project items have been ordered, invoiced, and paid for as they should be. This means less chance for billable project expenses to go un-invoiced.
Investing in a system like DesignDocs where project management integrates with accounting means that all your firm's financial information (such as costs, margins, budgets, and accounts payable and receivable) automatically feeds into the bookkeeping function. So, regardless of whether you handle the accounting yourself or hire someone else, the information is instantly there without having to lift a finger. Plus, you can count on the fact that it's 100% accurate.
4. DON’T BE AFRAID TO ASK FOR HELP!
Bookkeeping isn't a function that you can just feel your way through – there are various rules and regulations to adhere to and several tools that can simplify or complicate the process. Therefore, you should never hesitate to ask for guidance.
The DesignDocs team is always here to help field your questions and point you in the right direction. As a company, we were founded by a chartered accountant, a designer, and two software and technology experts. Built out of an industry need for online financial management software for design professionals, DesignDocs targets and solves unique project management and accounting challenges facing interior design firms.
With over 80 years of collective professional experience, our team is here to offer support, whether you're new to the software or a long-time customer. We are always happy to share bookkeeping knowledge and tips so your firm can run as efficiently as possible. Schedule your free software demo, or get in touch with us today.
