- Outsourcing your accounting and bookkeeping frees up your time to do what YOU do best!
We've met hundred of business owners over the years and have seen hundreds of accounting systems during this time. So we have a pretty good idea of what happens when business owners keep their own books. Granted there are examples of owners that have had impeccable books and records. Unfortunately some of those went out of business or floundered. Why? See reason number 3 below. Read on for or Top 65 Mistakes Business Owners Make When Keeping Their Own Books.
1. Financial Statements Are Not Produced in a Timely Fashion
Timely financial information is critical to your business. You should have financial statements within 20 days after the end of the month so you can review such indicators as cash flow, profitability, expense trends, labor costs, material costs, etc. Possibly the only thing worse than financial statements that are not timely is financial data that is not accurate.2. Financial Statements Are Not Accurate
If financial data that you use to run your business and for tax planning is not accurate, you are asking for trouble. Not only does it prevent you from understanding and improving the operations of your business, it could prevent a bank from approving a bank loan, or cause a surprise tax bill when you complete your tax returns.3. Your Focus is Diverted From Improving Business Growth, Profitability and Cash
Flow
The business owner who focuses their time on the wrong activities is not focusing on what they need to do to grow the business and take a more strategic viewpoint. People get into business for a variety of reasons. Some start a business because they know how to run a restaurant. Someone else has a great idea for a new product. Another has a passion for manufacturing and knows what it takes to produce products better than anyone else. I have yet come across anyone who got into business because they love keeping the books. Most admit they dislike that part of the business but know it's critical to their success. But by stealing valuable time for the bookkeeping is keeping them from focusing on their companies vision, sales growth, profitability, and cash flow. They are working IN their business, not ON it.4. Don't Understand How to Read an Income Statement, Balance Sheet and
Statement of Cash Flows
We see many business owners who toil over keeping their books, spending hours and hours of their valuable time on bookkeeping, only to produce reports they have no idea on how to use.
When we handle your books, you will be trained in how to interpret and use a balance sheet and statement of cash flows,
in addition to the income statement, to monitor your business, improve profitability, and manage cash flow.
See a sample of
what we provide to our clients every month.5. Do Not Have a System for Keeping Records
If the IRS were to select your business for an audit, would it withstand the intense scrutiny an IRS agent can put you through? Do you know which records you must keep to prove various types of expenses? Do you know which records must be maintained to prove a deposit into your checking account is not income?6. Don't Have An Advisor They Can Use to Their Benefit
When a business owner is keeping their own books, it can be a lonely place. With no place to turn for valuable advice throughout the year, you may rely on counsel from family, friends, acquaintances; individuals who many times are not trained in all the financial and tax aspects of a business. We have heard far too often that "my buddy does it this way," or "I heard from my brother-in-law..." Most often this advice is incorrect or misleading and can get a business owner in trouble.When we handle your bookkeeping, your financial data will be accurate, timely and reliable. You will be in control of your finances and understand what drives your profitability and cash flow. You will have access to advisors in a moments notice - just a phone call away. Download our info sheet on how our process works. Or contact us today at 815-788-5114 or use the form below to get started.