We often find that business owners wear many hats: operations, marketing, HR, salesman, accountant.
It takes a lot to get a small business off the ground, and implementing good accounting practices from the beginning can make that process even easier. However, one must be extra careful when it comes to keeping up with their business books. Here are some common mistakes that plague business owners and can have major consequences.
Lack of Budget
When you’re balancing several tasks at once, and it seems like everything is an immediate need, it can be tempting to take action and worry about consequences later. This can be detrimental to your finances. We suggest creating a budget for your business and sticking to it. This will allow you to have a simple, realistic outlook of your business’s finances and allow you to set goals and save up for big purchases.
Data Entry Errors
Small clerical errors can lead to very large consequences. Just one added zero can throw off an entire budget. While eliminating human errors completely is not truly an option, we suggest having a trusted advisor or alerts in your software to detect irregularities and keep you on track.
The Little Things
As you’re making purchases for your business, it can be easy to write off small purchases. A few supplies here, a lunch there, or a roll or two of stamps may not seem like a big deal at the time, but all of these added together can become a big expense. It’s important to pay special attention to details big and small.
Technology is not perfect. We’ve all encountered a time or two when our computers or phones have failed us. It’s vital that all of your financial data can be backed up. While most software has an automatic backup, you can truly never be too careful. Speak with an accounting professional on which backup services can be trusted.
Always ensure that the bookkeeper or accountant for your business has processes and procedures in place that leave little room for errors and mistakes. Contact one of our staff members if you have questions about your accounting practices or want to learn more about how our firm can help.