Businesses generally have a tendency to struggle with balancing hectic schedules. It is the tough love nature of running one and it is what keeps the competition going. As a consequence, it is usually the bookkeeping tasks that are being constantly being postponed. The thing is, bookkeeping does mean the difference between remaining in business and going under.
Cash flow and tax problems are just some issues that we can find ourselves in. If we are falling behind on our accounting tasks, we need to step up our game. Otherwise, we could fall victim to many of the problems such a situation will inevitably lead to. Here are some key points to go over.
#1. Identifying the problem
This is the first and easiest step to make. If you are reading this, chances are that you are already aware of the problem. Or at least, that there is some kind of problem. Just in case we are being proactive and are reading this article before the train wreck, what are the indicators to look for? There are plenty of them, depending on the type of business we are in.
If we cannot pull a profit and loss statement on demand, it indicates that there is a problem. Any excess of paper and receipts at our desks, invoice systems that are not integrated our accounting systems, redundant entering of transactions, and many more. The list can go on forever.
Whenever we feel uncomfortable with our bookkeeping performance, we probably already have some sort of problem.
#2. Catching up and setting things right
If we have been proactive, that would be the best solution. If not, we need to find ways and motivation to remedy the situation. Generally, there are two reasons that might have an influence on our decision-making in a hastily.
It is either deemed too costly and/or difficult to remedy, or we have not felt the full extent of the consequences a bad accounting system can bring us. There are plenty of businesses that have invoices from a long ago that were never paid. These can accumulate over time and can bring with them unnecessarily added interest.
Basically, we lose more money than previously intended. Other than financial, we can face other types of expenses. For example, in the form of time and psychological well-being. If we allow ourselves to experience accounting and bookkeeping problems, we will spend more time chasing paper, entering data, and generally cleaning up the mess. In today’s world time is money, and we can always spend it adding value to our product or service, rather than plugging holes.
#3. Avoiding mistakes
Running even a small business is complicated. Accounting and bookkeeping are a separate, dedicated science that people go to schools for. Hiring experienced bookkeepers from reputable organizations can relieve us of the stress associated with everyday accounting tasks. Luckily for us, there are plenty of companies that offer these services like the IMT Accountants & Advisors.
This is the most overlooked but also the best option to go with. The reasons being are that to outsource such a delicate trait to professionals as early as possible will save us money, provide insight for future endeavors, and negate any legal problems.
Our bookkeepers need to have all the information they need to maintain accurate records. Also, they need to keep the lines of communication open so no data is accidentally omitted or transferred incorrectly. They can integrate our systems and reconcile transactions regularly. Another thing we mentioned, they can provide us with financial insight. This means regular and on-demand financial reports.
These are important for us to make future decisions based on accurate current states of our company. Can we invest as the new financial year starts, or do we have to be conservative? These and many more are the questions that accountants and bookkeepers can help us find answers to.
Some businesses can fix their own mess up to a point. This is especially true for smaller and startup companies. Doing it ourselves can be pretty tricky, particularly if we do not come from an accounting background or know someone who does. As our company grows, we begin to recognize the need for our accounting and bookkeeping department to be staffed with professionals.
They will save us a lot of money, time, and will minimize the chances for us clashing with the law and the dreaded internal revenue services. No matter what path we choose to take, our goal should always be the same. And that is fixing our problems in a way that is focused on the future and growth of our company.