Regardless of the goals of a business, there will be one that many share, and that is sustaining a profit. Although every company has the best intentions of managing its funds correctly, other aspects of the business can mean that some of the bookkeeping is overlooked, and mistakes are made.
The ramifications of the mistakes can vary but being aware of the most common can ensure that the business is in the best position to sustain a profit and meet its financial obligations.
No Business Plan
In some instances, a business overview can seem straightforward, but this does not mean that a business plan should not be created. A business plan allows a company to have a clear overview of its goals and includes contingency plans when obstacles arise.
Not Keeping Business Income Separate
The early days of a business can be difficult, and a lot of work needs to be carried out. Opening a business account may not seem important, but the longer it is left, the more problems can arise later.
Having a separate business account ensures that there is less work that needs to be carried out and that money is not being spent that should be reserved for business costs.
Even those operating as a sole trader can benefit from a separate account, as there will still be costs and liabilities that need to be accounted for.
Not Keeping Track of Petty Cash
As with other aspects of the business, petty cash can seem insignificant compared to other aspects of the company. However, keeping track of petty cash from day one means that all income and expenditure are accounted for, and petty cash is not being misused.
There can be instances when several people are using the petty cash, and not keeping track of these transactions could lead to complications when finalising the business accounts.
Keeping Track of Employment Status
The way employees are sourced for a business will vary. Some will only use full-time employees, while others may use the services of freelancers. A company that ensures that they have an up-to-date record of the status of all employees, ensuring that no mistakes are made when filing accounts.
Not Enlisting the Services of a Professional Bookkeeper
It is understandable why some people feel that taking care of the bookkeeping themselves is a good way of saving money. However, there can be a series of demands a business has to face and keeping track of accounts can become more time-consuming as the business grows.
As such, enlisting the services of a professional bookkeeper as soon as possible helps the business make money in the long term. As well as ensuring that all income and expenditure are accounted for, it also ensures that there are never any issues regarding filing dates and keeping track of company profits.
If you’re still to take advantage of using a professional bookkeeper, then why not contact ProBookkeeper to discuss your needs in more detail?