Accountrail, LLC | Bookkeeping & Taxes

The Price of Bad Bookkeeping

Oct 12 15 at 06:58:04 PM There are a lot of great bookkeepers out there, but there are also a lot of really bad bookkeepers Not keeping your books up to date is as bad as hiring a bad bookkeeper Without a full understanding of your finances, you may quickly find yourself adding to the number of failed businesses within a few years of your start up A bad bookkeeper or the lack of a good bookkeeping system can affect your decision making, whether you qualify or not for a loan, as well as saving on taxes and avoiding penalties

How can you avoid these issues? What are your options as a business owner? Unfortunately, for new and small business owners with low funds or a tight budget answering these simple questions can be challenging Some may argue that your best option is to hire a professional I don't necessarily agree with that Spending money on hiring a full time bookkeeper when those funds are needed in other areas such as sales and marketing can get you out of business faster One way around this problem is to hire a part time bookkeeper with experience in your industry to guide you in the right direction Depending on the transaction volume and the amount of time needed for other tasks, such as getting new clients, you could take some bookkeeping courses and learn how to use accounting software like QuickBooks or Peachtree Whether you do your own bookkeeping or you hire someone to do it for you, you should have a basic knowledge of bookkeeping and accounting in general What type of bookkeepers to avoid? » A bookkeeper that doesn't reconcile your bank and credit card accounts on a timely basis To have accurate financial reports you need to reconcile your accounts first Knowing that you are not making enough profit on the sale of a product or paying for marketing that is not bringing you new clients three months later is not a smart way of running a business » A bookkeeper that stares at you blankly when you ask a question In general, stay on top of your financials As a small business owner you should know the basics, if you don't go online and do some research or take a class