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Five Accounting Mistakes that Put Your Business at Risk

Five Accounting Mistakes that Put Your Business at Risk

Stressed business woman running out of money - stock and market down

Even good people make big mistakes. To err is human and the mistakes that we all make can be insignificant or have enormous consequences. Accounting is the language of business, so if you make big accounting mistakes, it could affect your business significantly. ABSS accounting software can help you to minimise accounting mistakes and lower the risk to your business. ABSS accounting software is simple, easy to manage and helps save you time by improving productivity with fewer errors. Risk is everywhere. Even small risks can sink your small business, don’t let this happen. It usually takes more time to correct a mistake than to get it right the first time. It is also less costly to identify and correct mistakes early in a project rather than waiting to correct the problem later. Correcting mistakes also takes time. Save yourself time and reduce accounting mistakes with ABSS accounting software.

 

Five Common Accounting Mistakes:

Failing to follow accounting procedures

Putting in place formal, detailed procedures for managing bookkeeping and professional accounting will help prevent accounting mistakes. So get started by developing standardised forms and checklists to complete that ensure consistency and accuracy. You may want to document a process for setting up new vendors; you will probably need a vendor’s name, address, telephone number, and Identification Numbers as well as other documents when you are doing business. The less paperwork, the better. So when you use ABSS accounting software, all you need to do is enter this information into your accounting software then process payments.

 

Data entry errors

“I can’t believe I did that!” We have all thought this to ourselves at some stage as we sit and look at the screen in amazement. Yes, unbelievable errors happen so you should have the policy to perform various reconciliations in a timely manner that ensures that data entries can be detected quickly and can be corrected if necessary. ABSS software can help you do this easily.

You will need to perform monthly, or even bi-monthly, bank reconciliations, as well as accounts receivable and payable reconciliations. Unusual transactions should be reviewed to ensure that no data entry mistakes have been made. 

 

Failing to Back Up Your ABSS Accounting Software

You need to back up your business’s accounting software and other data regularly. Don’t forget to upgrade your software too. Many small business accounting software programmes have a feature that lets you set up a backup of your accounting programme. Use this to help your small business. Try out free accounting software and cloud accounting software packages that allow you to double-check your backup files. Sometimes files corrupt; sometimes you do not back up all the data you need. More, common mistakes. Oops! ABSS accounting software can help you with back up.

 

Outsourcing errors

Making mistakes yourself is annoying. Other people making mistakes in your accounting can be infuriating. Whilst outsourcing accounting services tasks can add value to your company, mistakes made by others can be really risky. Your tax accountant is likely to be better versed in tax law than you are, so outsourcing tax planning and preparation to your accountant may help you to lower your tax liability, increase tax compliance, and leave you with more time to focus on growing your business. ABSS software does this for you. It saves you time without losing control. When you make mistakes, you only have yourself to blame. 

 

Failing to Categorise Income and Expenses Properly

All money coming in and going out of your business must be assigned to the appropriate category. Your cash flow is vital for your business. Business owners who stay on top of their accounting records should not run into mistakes. ABSS accounting software will you to know who was billed, when, how much for, and whether or not the customer has paid. You should also find your year-end tax preparation will be much smoother than trying to reassemble the records you need to prepare your business’s tax return right before the return is due.

Use ABSS accounting software to reduce your accounting errors. Make your SME accounting easier. 

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