Common Mistakes Business Owners Make When Handling Their Bookkeeping
The Business Butlers share the top three common mistakes business owners make when handling their bookkeeping. Being aware of these mistakes can help business owners make changes to their bookkeeping practices.
1. Get books current and daily maintenance
Most business owners choose to do bookkeeping during the early stages of the company. However, as their business thrives and grows, owners cannot keep up with the daily maintenance required for bookkeeping. This causes business owners to scramble and get their books in order before tax season. They are too busy with day-to-day operations to spend time on bookkeeping. When the books and financial reporting are not kept current, this error is costly to the business. Tax penalties and paying for an extension cost the businesses 5% of the taxes due. In addition, lending organization require current financial reports for business seeking a business loan.
2. Payroll Management
Payroll is a big job and requires attention to detail and very time-sensitive. In addition, to quarterly and annual tax filings, payroll requires managing new hire paperwork; workers compensation; tracking: sick, vacation, holiday, garnishment, retirement and health premium payments. Business Owners are focused on the day-to-day operations and may not be current on payroll tax changes. Errors made to employee paychecks are a duplication of effort and timely. Businesses missing their quarterly payroll tax filings are penalized 5% of the taxes due.
3. Knowledge of QuickBooks
Businesses that use QuickBooks, know simple tasks, when done incorrectly, can create errors in financial reporting. Some examples: from setting up and syncing bank accounts incorrectly; categorizing transaction as an expense vs. asset, or creating an invoice undercharging of services. These errors impact the financial health and decision of the business.
Our team at The Business Butlers are highly knowledgeable in all areas of bookkeeping. Our team specializes in both QuickBooks Desktop and QuickBooks Online, Payroll, and administrative support. To learn more about the services we offer, please click here. To get in touch with us, please click here.