Regardless of whether you have a consultancy company, a cafe, or a construction firm, one thing you need to get right is the accounting side of your business. Nevertheless, this can be much easier said than done. A lot of companies today are making accounting errors without even realizing it. Are you one of these businesses? Read on to find out five of the most common business accounting errors you need to avoid.
Being On A Different Page As Your Accountant
Have you hired an accountant? Do you thoroughly understand what your accountant is providing you with? Don’t let your accountant confuse you with complex jargon. Speak your mind – you need to know where your money is going.
Failing To Record Cash Expenses
Tracking each and every expense is of huge importance, no matter how small it may seem. From China carbide parts to notepads and pens, there is no telling what sort of expenses your business has. But you need to record them all. This includes cash costs. You can use so many different tools to track debit card and credit card activity. Nonetheless, nothing can track cash, apart from you.
Losing Track Of Your Receivables
This is definitely a huge mistake that a lot of companies make. You may end up with big cash flow issues if you do not make sure you are paid efficiently and keep track of your receivables. You are going to find yourself wasting lots of hours, overpaying on your taxes, and suffering from big debts if you do not track your funds that are incoming effectively.
Failing To Keep Expense Receipts
Do you hold onto all of your receipts? If most people are honest, they don’t! After all, it requires a bit of effort, doesn’t it? But if you fail to hold onto copies of any receipts for business costs, cash flow issues will come to the fore, as well as problems with accounting and taxes. Plus, this merely scratches the surface of the bad things that could happen. You could be in a lot of trouble if your company is ever audited and you have no receipts to back up the expenses you have claimed for.
Tax Blunders
Tax mistakes can cost you in so many ways. Not only could you miss out on deductions but you could end up on the wrong side of the law. This is why it is often a good idea to hire an accountant to take care of all of this for you.
So there you have it: five of the biggest accounting mistakes your business needs to avoid! If you are currently making any of the mistakes mentioned in this blog post, try not to get too stressed about it. You still have plenty of time to put things right – it is all about acknowledging where you have gone wrong and take action.
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