The four biggest bookkeeping mistakes everyone has made
For many, keeping company books and records up to date is a real chore, but it doesn’t have to be! As accountants, we see hundreds of business accounts every year, each one with different approaches to bookkeeping.
Below, we’ve outlined the four most common mistakes we see from day to day. The occasional slip-up is inevitable, especially when you’re first starting out, but by avoiding these pitfalls you should see a huge change in the way you do your bookkeeping and the benefits you see from it.
- Never reconciling
Reconciling isn’t just for your bank balances. By doing regular reconciliations on your balances, whether that be for PAYE, VAT, Loans etc you’ll ensure your books represent the true position of the business.
The reconciliation process is often where errors are found, ones that if left unchecked could cost you heavily down the line. The good news is that this process has never been easier. New cloud accounting systems are heavily geared around helping you reconcile your bank. Now many include automatic bank feeds, it becomes a walk in the park. But if you’re not sure about how, or when to reconcile, we’d be happy to help.
- Letting the paperwork build!
It’s a pretty tiresome phrase, but little and often really does pay dividends when it comes to keeping your books in check.
Keeping everything up to date also has other benefits beyond just your stress levels. Keeping track of what customers owe you becomes easy when your books are in order, and you can make informed financial decisions when you know the position of your business. Automatic bank feeds are taking the hassle out of bookkeeping for many of our clients, and allow them to log in regularly and see their accounts change in real time. Moving your books to the cloud really has never been better.
- Treating bookkeeping as admin
When you receive your year-end accounts, the numbers shouldn’t be a surprise. Successful businesses have one thing in common; they know their position and performance.
What is your bottom line for this month? Are you chasing customers effectively? How is your cashflow management? A well-kept and effective bookkeeping system should be something that gives you timely and useful information. We offer a number of cloud accounting systems that have been designed with that in mind. Read about it here, or contact our cloud specialists to learn more.
- Trying to do it all
It’s tempting to think that you’ll save money doing the books yourself. But it’s worth thinking, is my time really best spent updating my books? Letting a qualified accountant handle your books not only frees up your valuable time, but it means you avoid costly mistakes, especially with HMRC. Our qualified bookkeepers can take the work off your hands – contact us to learn more.
Follow these four tips, and managing your business finances will become a lot easier. As with any financial matters, however, speak to your accountant to see what’s best for your business. They’re in the best position to advise you on what system to choose, and how to implement it.
If you would like more information on managing your books, or are interested in our cloud accounting systems, contact us and speak to one of our qualified accountants.