Having a strong accounting framework in place is an integral part of managing your organization. The COVID-19 pandemic has highlighted this need and demonstrated just how important it is to have a professional manage the firm’s finances. Accounting is a complicated task; the numerous entries, paperwork, and ever-changing regulations can be hard to organize if you don’t have the relevant skills and qualifications. Business owners often decide to do their own books to cut back on cost. Below are three specific reasons business owners could be hurting themselves by doing their own books.
You’re Sacrificing Valuable Time
Business owners wear many hats and have to manage various operations throughout the day. Recording all entries and managing the company’s finances are added work for them. Since accounting requires attention to detail, entrepreneurs may feel like they are drowning in work. If you decide to do your own books, you will be responsible for managing everything from recording entries, paying bills, sending invoices, and reviewing financial statements.
You’re Creating Potential Liabilities
Financial records are crucial for filing taxes and making future plans. Thus, the highest level of accuracy and precision is required. If the books are not accurately managed, it will limit your ability to tax plan and increase the chances of penalties due to inaccurate tax filing.
Your Inability to Plan
A lack of accurate information can cause major oversights in day-to-day operations and future financial decisions. The ability to quickly gain a feeling for the business from reviewing the financial statements and then putting together a plan based on those statements and company goals is an important part of every successful business. Those statements however are only helpful if the information in them is current and accurate. If they are not, decisions could be made that take the company in the wrong direction.
Fox and Partners provides worry-free accounting for business owners, freeing them up to focus on growth and success. Contact us today to learn more!