Running a small business involves operating on a small budget and as such maintaining proper bookkeeping method is critical to prevent any unnecessary loss or financial expenditure. Bookkeeping is more than just recording financial transactions in a ledger and any negligence in maintaining it in a proper way may even result in the falling apart of your small business.
To put things in a nutshell, it is essential to hire bookkeeping services near me who has expertise in maintaining your bookkeeping accurately and can provide you the reports that reflect your business activities aiding in insightful decision-making.
Caution! These 5 Bookkeeping Mistakes Can Cost You a Fortune!
Bookkeeping services for small businesses are necessary to avoid any mistakes in the proper maintenance of financial records. If proper measures are not adopted, the following mistakes can be anticipated:
1) Confusion pertaining to major purchases with immediate expenses
The immediate expenses such as purchasing stationery items (pens, papers, pencils etc.) should not be tied up with major purchases such as a microwave oven for your employees. And as a thumb rule, such items or equipment should be recorded as an asset due to its potentiality for use over a long span of time.
2) Failure to keep receipts for smaller expenses
Another type of common mistake that you as a small business owner are making with your bookkeeping records is a failure to keep track of receipts of expenses incurred for small purchases. For instance, small business owners often incur expenses on minor purchases such as gas for travel; lunch on the road and for extra office supplies at the end of the year and the right approach is that the concerned business owner should account for anything and everything for claiming such expenses. Failure to keep or maintain receipts for these expenses may end up in paying higher tax bill without sufficient proof to back up the spending.
3) Being unwilling to delegate
Most small business owners are not ready to delegate their bookkeeping to experienced firms involved in providing bookkeeping services who will have the expertise in handling the activities pertaining to the concerned businesses’ core competencies. But remember that you will need the expert advice and the services of experienced accountants involved in providing bookkeeping services in order to maximize your incomes and minimize your taxes.
4) Failing to take bookkeeping seriously
A vast majority of small business owners fail in giving priority to bookkeeping functions. Keeping detailed and accurate financial records is a necessity rather than a choice for the success of your business. Never overlook even small purchases, sales, or other expenses. For, failing to take care of good accounting records in even one area of the business may create a domino effect on the accuracy of all the financial records.
5) Poor communications
Improper or poor communication between you as the business owner and your bookkeeper can result in serious mistakes in accounting records, filing reports resulting in serious issues such as failure in the reconciliation of statements to inaccurate key financial data.
Get professional help
In order to simplify your bookkeeping needs, Billah and Associates Inc., one of the reliable bookkeeping services in Mississauga, Toronto, Ontario can be your trusted partner. With customized solutions that meet your specific needs, our bookkeeping services for small businesses will no longer be a hassle.