Many small business owners try to bookkeep on their own or internally. Often, they make common bookkeeping mistakes that are easily prevented by hiring a bookkeeper. In this blog post, we will discuss 4 of the most common bookkeeping mistakes small businesses make and how you can avoid them so you don’t lose any more sleep over your books!
Separate Bookkeeping & Running the Business
Mistake #1 is not separating bookkeeping from running the business. This is a common problem among small businesses because bookkeepers are not in charge of managing and helping run the day-to-day operations of your company. When you’re a small business owner and you spend hours of time working on the books you’re focusing on the past and not able to create future revenue! Your first order of business should be to focus on your business and not spend too much time bookkeeping!
Keep Up With Your Bookkeeping
Mistake #2 is not keeping up with bookkeeping. The problem here is that small business owners often think bookkeeping should be a once-a-year task when it’s really an ongoing process.
You need to balance your bookkeeping by doing at least one entry per day if not more! This will help you maintain accurate books and give you the proper information for making decisions. It also will prevent the massive mistakes from happening and cause you days of searching for that one rounding error you made months ago!
Looking At Your Financial Reports
Mistake #3 is not taking time to look at your financial reports after bookkeeping. A bookkeeping session is only as good as the data it produces. So if you don’t take the time to look at your financial reports after bookkeeping, then all of that work will be in vain. The key here is to use what bookkeeping tells you about your company’s performance and make changes or improvements where necessary.
Take Bookkeeping Seriously
Mistake #4 is not taking bookkeeping seriously. Bookkeeping is not a simple task to do on your own, and if you don’t take it seriously then the consequences can be disastrous for your business. Hiring good bookkeepers that are qualified means less worry about errors being made in bookkeeping and more time to focus on running the day-to-day operations of your business (and that means more revenue for you)
So to round it out, here are the 4 most common bookkeeping mistakes small business owners and leaders make:
Mistake #1 – Not separating bookkeeping from running the business.
Mistake #2 – Not keeping up with bookkeeping.
Mistake #3 – Not taking time to look at your financial reports after bookkeeping.
Mistake #4 – Not taking bookkeeping seriously.
There’s one simple way to avoid these common mistakes and all the other small mistakes that can happen when doing your own bookkeeping and that’s hiring a professional. Our team at Still Water Accounting & Consulting can not only get your books in order but can also get you the relevant financial reports to make informed decisions for the business.
If you want to have a conversation about being able to focus on your business future instead of sitting down for hours to review every transaction in the past you can get started below.