Top 3 Bookkeeping Mistakes
- Sara Goldin
- Apr 25, 2019
- 2 min read
Many small business owners, like yourself, do their own books. Sure, it's not everyone's favorite, but you have small business, so why not.
Unless you have background in accounting, there are some common mistakes that we all make. Here are list of a few mistakes and how to fix them.
1. Not Separating Business and Personal Expenses
This a common mistake for many business owners, they need to get something for the business and then they swipe their personal card. Sure, you have the best of intentions to get that money accounted for later as a business expense. If you are ever audited by the IRS, this is a big no-no. And it starts a confusing pattern in your accounting. Your best option, is to always purchase business expenses through your business account.
2. Not Keeping Receipts
You have the best of intentions, you will remember what that $17 item was at the one store the other day. Then when you are reconciling your account at the end of the month, now you can remember what that small thing was. These missing transactions add up quickly! What if it was something you could have used a deduction?! My best advice is to take a picture of that receipt, and make a note of what it was. You can use an online notebook, or even just email it yourself for later. Just don't lose those receipts!
3. Doing it Yourself
You business isn't that "big" or have "too" many transactions, sure, you can handle it yourself! You join Quickbooks Online, or Xero, or one of the other "easy" accounting programs. Yes, they are easy to use, and will help streamline the process, but if you don't have a background in accounting, there are so many details that can be missed. Also, as a busy business owner, you are busy growing your business, not doing mundane accounting data. So 1 month pass, then it's 3 months, then you are so far behind you have no idea where to start. Bookkeepers are more efficient, and have a better understanding of all the ins and outs of accounting, and will help keep you focused on what you do best.
Now take these tips, and work towards building a better business! Have questions? Feel free to reach out and ask!
Comments