Keep Basic Financial Records

It is long since I had this feeling of insufficiency in simple financial matters, and worse more in a church. I had really an interesting moment in church last Sunday. The management of the church has decided to carry out a simple survey on how the members keep basic financial records and hence induct them on setting priorities in personal business finance.

So, just as I was about to warm my chair, I was handed a pencil and a questionnaire to fill. Besides bio data, which was an optional field because the purpose of the study is to induce self-realization in this life’s important component, the form directed one to declare debt levels, both structured through financial institutions like banks or other, to informal like shylocks. More importantly was the part of listing spending avenues, and of course if this was planned or irregular. So, as the clergyman insisted that we needed to be honest with the whole exercise as much as possible, I found myself developing heat and I could feel the reality check all over me.

Record keeping is an old art, first perfected by legal world, kingdoms and religious teachers to preserve history as well as decrees and contracts. Records, no matter how simple or minute they are, can help one remind themselves of previous happenings, status and help predict or plan for the future.

In personal and business finance, this is one of the pointers to success. You cannot know where you are going without knowing where you are. As a business person for example needs to keep himself appraised on all parameters of the business like stock levels, profitability, expenses etc. all these can be easily deduced from records. A lot of business people realize they are on a negative growth trend a little late, particularly in the absence of record keeping. In such times also, managing process flows becomes a challenge since for instance it is not easy to determine when to replenish stock or not.

Besides, every other institution around us really needs a detailed day to day documentation of activities. KRA relies on our own records to tax us. The banks are asking for business records to compare with account statements for us to access credit facilities. It makes sense therefore for any single business person to initiate and entrench record keeping as a vital tool for business success.

I liked that our church encouraged us to carry around a minute booklet, the size of ATM card, that helps monitor our spending by recording every single spend, and checking the total cost at the end of a particular month. I found this very practical particularly for personal finance management. It is easy to know what your priorities in terms of spending are. So, for those who do not keep records of expenses and income, here is a simple tool, and it makes sense to keep it that simple until a point when the business grows. One can then hire people for this purpose and even engage book keeping software to automate the whole process.

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Zak Syengo is the Senior Manager Marketing & Communications at Rafiki Microfinance Bank


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