31 Aug 3 most common accountancy mistakes businesses are still making
Accountancy in business is a process that’s as difficult or as simple as you want to make it. Businesses of all sizes often complain about the trouble they have balancing their books, but at the same time all too often they’re making one, or all, of these three common mistakes.
Be aware of them and avoid them to make accountancy as stress-free as possible.
Accountancy is only as accurate as the records that you have kept. It’s as simple as that. Many businesses neglect to invest any thought or effort into improving the organisation of their bookkeeping, which results in headaches every year.
Put the extra time into developing a neat and orderly filing system that you understand, and then actually use it. The small amount of effort required to make sure you have the right receipts, the correct records, and the ability to track your income versus your expenses will save you stress in the long run.
Going it alone
This is something that plagues SMEs. When you’re a single-person operation, it’s easy to think that you’re saving money by not hiring an accountant and doing your bookkeeping yourself. It may seem like you’re saving money, but in reality you could be costing yourself more than you’re saving.
Hiring a good accountant is an added expense, but one that should yield returns. Not only do you get the peace of mind of knowing that your taxes are properly paid and your business is in good standing, but your bookkeeper may also be able to bring to your attention certain areas of tax relief and claimable allowances you didn’t know existed.
A lot of businesses seem to think their accountant has the power to read their minds: this is of course not the case. Your accountant will only be able to work with the information you provide or that you allow access to, so make sure provide as much information as possible.
This means regularly keeping records, digital or paper, about your income and your expenditure. This will prevent costly oversights occurring when it’s time to submit your returns.