How to Do Bookkeeping for Small Business in 3 Steps

Bookkeeping sounds more complicated than it needs to be. Strip away the jargon and it really comes down to three things: connect your accounts, import your transactions, and categorize them.

That's it. Do those three consistently and you have a working set of books — no spreadsheets, no manual data entry, no accounting degree required.

Step 1: Connect Your Bank Accounts and Credit Cards

Link your business bank account and any business credit cards to your bookkeeping software. This is a one-time setup that lets every transaction flow in automatically instead of you typing each one in from a statement. If you're using a personal account for business spending too, this is also the moment to start routing everything through a dedicated business account — it makes every step after this one easier.

Step 2: Import Your Transactions

Once your accounts are connected, your transactions import on their own — no downloading CSVs from your bank or copying numbers into a spreadsheet. New charges and deposits show up automatically, ready to be sorted.

Step 3: Categorize Every Transaction

This is the part that actually turns raw transactions into books. Each one gets assigned a category — rent, software, contractor payments, client revenue — so that later, when you (or your accountant) need to know what you spent on ads last quarter, the answer is one click away instead of a forensic search. Do this as transactions come in rather than saving it up; a few minutes a week beats an afternoon of guessing what a charge from three months ago was for.

And Here's How to Do It in Sphere

That's the whole process, shown start to finish — connecting an account, watching transactions import, and categorizing them as they come in.

Start Bookkeeping in Sphere for Free

Questions about setting up your books? Book a demo and we'll walk through your specific setup.