Bookkeeping Mistakes Small Businesses Must Avoid

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Bookkeeping isn’t a strong suit for most small business owners. Many don’t even think about the headache it can cause when they open a business because they’re so excited about starting their new passion.

The bad news is that bookkeeping is the only way to ensure your business stays afloat. The good news is that it’s not as hard as you think, and there’s plenty of help available when you can’t do it yourself.

For now, let’s focus on the top bookkeeping mistakes you must avoid.

Not Keeping Receipts

The first mistake is not keeping receipts. I know it gets tedious, and no one likes a shoe box full of receipts lying around.

But today, it’s much easier to store receipts electronically. So you’ll be glad you did when we’re able to find ways you can deduct those expenses. No amount is too small; keep everything. If it turns out you can’t deduct it, get rid of it, but until then, hang onto them.

Procrastinating

No one loves bookkeeping, but it’s necessary. Plus, guess what?

If you don’t do it regularly, it becomes even more painful because you will have to catch up. So now, instead of spending a little time on bookkeeping, you’re spending hours on it, losing time you could be working on your business.

You should reconcile, record, and follow up on accounts receivable at least twice a month, if not more often. I know you don’t like it, but you’ll like it even less if you put it off.

Not Reconciling

Another task most business owners hate is reconciling, yet it’s important. Don’t just toss those bank and credit card statements in a pile. Instead, make them a priority and reconcile your accounts. You’ll be glad you did.

What if there are errors or charges you weren’t aware of? You don’t want to bounce your funds or prepare incorrect financial documents, do you?

Not Outsourcing Your Bookkeeping

You don’t have to hire a full-time employee to handle your bookkeeping, but outsourcing it is essential.

Not only will you not have to be tasked with the bookkeeping yourself, but you’ll save a lot of money and know that it’s done right. Why risk making mistakes, overlooking the need to do the bookkeeping, or waste money hiring a full-time employee? Instead, outsource and get the best of all worlds.

Final Thoughts

Bookkeeping is essential to your business, so don’t ignore it. It’s okay if you can’t do it yourself, but be sure to outsource, so it’s done right. If you have questions about bookkeeping or want to get started with outsourcing, contact me today to learn more.