Accounting is one of the biggest challenges for small business owners, so it’s no surprise that 40% cite bookkeeping and taxes as the worst part of owning a business. Yet, there are so many reasons to keep your books in order – from knowing your cash flow to satisfying a potential audit, the reasons for staying organized and maintaining thorough records are innumerable.
Here are five of the most common small business accounting mistakes we see and some tips to help avoid them…
Avoiding bank statement reconciliation
You have a to-do list that’s running off the page and it’s easy to let things slip by, but by reconciling your bank account on a monthly basis, you will stem a slew of headaches down the road. If finding time is an issue, schedule a one-on-one with your bank statement by picking a date that’s just after you receive your monthly statement. You’ll be able to reconcile discrepancies quickly, detect any overcharges if they happen and avoid important lapses of data collection.
Bonus: Commerce Sync offers automatic reconciliation for Stripe and Xero users by pairing bank feeds with transfers in your ledger.
Using a shoebox to file receipts
If your business receipts are piling up in an old Zappos box under your desk, it’s time to find a new process.