Almost every entrepreneur plans to grow their business and reach unattainable heights. However, not everyone manages to do so and there is one common obstacle behind it that is Bookkeeping and accounting.
Whether it's a start-up firm or an established organization, bookkeeping is important to every business's success. However, some small companies usually don't have professional bookkeepers, despite knowing all the pros and cons of bookkeeping.
Almost 6 out of 10 business owners believe that they don't have bookkeeping companies that have knowledge and expertise on small business accounting and corporate payroll services concepts. And can lead to common bookkeeping mistakes that can cause harm to their business during its initial stage.
In simple terms, Bookkeeping refers to organizing and preserving your financial and accounting details which include tax planning, tax records, payroll details, ledgers, etc. Hiring a bookkeeping and accounting company can effectively do financial assessment and management. It also eliminates the risk of obtaining an audit from the CRA and it allows business owners to keep track of growth and profit on an annual basis.
So, here are some of the bookkeeping that businesses need to avoid:
1. Lack of Business Plan
Planning is a must for starting or running any business. Building a strong business plan ensures that the organization is prepared and ready to be in operation. Your business plan should include your financial goals, payroll management and of course accounting process. It should layout the schedules and the staff who are responsible for taking care of each task. This way, there will be a balance as to when certain financial deliverables should be ready and who should be responsible for creating them.
2. Failing to Maintain Records
The recent advancements in cloud technology have made the corporate bookkeeper's job easier because there is a more secure and feasible option available in cloud hosting. It does an excellent job to make sure the data is accessible 24/7 regardless of the time and location. But there could be some problems for starters, technical glitches can prevent you from getting business reports, bank statements, and other important documents on the cloud server. This is why you should maintain a digital backup of every record.
3. Getting Rid of Receipts for Small Purchases
Buying several stationery items, spending a few dollars on a RO water system and many other small purchases often do not have records in the books. Many small business owners or start-up founders disregard such expenses receipts and it could create difficulties in budgeting and assessing cash flow if these small expenditures might amount to a hefty sum.
It is advisable to maintain receipts for all the business expenses amounting to less than $50.
So, to avoid these mistakes you need to outsource bookkeeping services. Hire the UHLENBROCK CPA team to get a customized accounting system that allows you to make strategic business decisions. You can get in touch if you want a small business CPA in San Antonio.
