Soup.io
  • Home
  • News
  • Technology
  • Business
  • Entertainment
  • Science / Health
Facebook Twitter Instagram
  • Contact Us
  • Write For Us
  • About Us
  • Terms of Service
  • Privacy Policy
Facebook Twitter Instagram
Soup.io
Subscribe
  • Home
  • News
  • Technology
  • Business
  • Entertainment
  • Science / Health
Soup.io
Soup.io > News > Business > Common Accounting Mistakes Small Business Owners Make
Business

Common Accounting Mistakes Small Business Owners Make

Cristina MaciasBy Cristina MaciasMay 15, 2022No Comments3 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Common Accounting Mistakes Small Business Owners Make
Share
Facebook Twitter LinkedIn Pinterest Email

As a small business owner, you’re forced to wear many hats, especially at startup. But the experience of performing every function that makes your business run is invaluable and provides an excellent foundation for successful entrepreneurship. The key is knowing when to ask for help.

Accounting and bookkeeping are great examples of crucial business functions an entrepreneur will often do themselves, especially when trying to save every dollar they can. However, consulting an accountant in Toronto for small business every once in a whileis well worth the money. Having them look over your tax returns can save you money in tax breaks you don’t know about and give you peace of mind that your returns are done ontime and by a professional. An accountant can also prepare the financial statements you need to help your business grow.

In the meantime, take a look at these common accounting mistakes small business owners make so that you can avoid making them yourself.

Table of Contents

  • Unorganized Paperwork
  • Putting Off Your Bookkeeping Until the Last Minute
  • Not Knowing Where Your Business Stands Financially

Unorganized Paperwork

The success of every business depends on its financial health. Your business’s financial health depends on having accurate records. Not to mention that failing to maintain adequate records is an offence under Canada’s Income Tax Act. While chances are that you won’t end up in jail for not keeping accurate financial records, once you come to the CRA’s attention, you can expect more scrutiny from them going forward.

Not keeping receipts for all expenditures, not recording petty cash expenses accurately on the day that they’re incurred, not putting money aside for taxes and GST/HST remittance, not having a separate account for GST/HST remittance and mixing personal and business finances are common documentation mistakes small business owners make.

Putting Off Your Bookkeeping Until the Last Minute

Not doing the books regularly is also a common mistake, and the repercussions can be fatal to a small business.

Because small business owners have so many things to take care of, many will put off doing the books until the end of the week or monthor longer. This is a risky thing to do because your business depends on maintaining the proper flow of cash going in and out for its survival. Not paying your bills and taxes on time can cost your business more money, as can not finding mistakes on your bills or invoices in a timely manner. And, of course, not staying on top of your accounts receivable jeopardizes the lifeblood of your business.

These are just a few of the reasons why bookkeeping needs to be done every day. Also, it’s a lot easier to stay up-to-date on your books than it is to catch up on your bookkeeping.

Not Knowing Where Your Business Stands Financially

Whether you own a restaurant, a hair salon or a personal training service, knowing how your business is performing financially and how it can improve are crucial to its success.

It can be difficult finding the time to take a step back and look at your finances from different perspectives, but it’s the only way to know which financial decisions are the right ones for your business. It’s also crucial to know that you always have enough money in your account to keep your business operating and that your business isn’t wasting money by finding financial inefficiencies. This is why businesses frequently prepare financial statements like balance sheets, income statements, and cash flow statements.

Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
Previous Article5 Times When Your IR Tech Needs a Critical Upgrade
Next Article Getting Your Credit Mortgage-Ready to Enter the Toronto Housing Market
Cristina Macias
Cristina Macias

Cristina Macias is a 25-year-old writer who enjoys reading, writing, Rubix cube, and listening to the radio. She is inspiring and smart, but can also be a bit lazy.

Related Posts

3 Tips for Getting the Best Possible Price for Silver

June 24, 2022

Tips on Saving Tax for Employers 2022

June 23, 2022

What Is An Aluminium Profile, And Why Should You Consider It?

June 23, 2022

Subscribe to Updates

Get the latest creative news from Soup.io

Latest Posts
Reason why you need Cash for Car Services
June 24, 2022
Things to Consider When Visiting a Toronto Plastic Surgery Clinic
June 24, 2022
Best Family Reunion Custom T-Shirt Design Ideas
June 24, 2022
3 Tips for Getting the Best Possible Price for Silver
June 24, 2022
Tips on Saving Tax for Employers 2022
June 23, 2022
How to Cope When the News Leaves You Stressed and Depressed!
June 23, 2022
5 Things You Should Never Say to a Friend with Depression
June 23, 2022
What Is An Aluminium Profile, And Why Should You Consider It?
June 23, 2022
Track Your Four-Legged Friends, With One App Designed, For Their Safety
June 23, 2022
Kuvera – The Best Share Market Platform
June 23, 2022
Make Your Own Deepfake Videos with DeepSwap
June 22, 2022
How to add a new domain/website to your VPS (cPanel/WHM)
June 22, 2022
Follow Us
Follow Us
Soup.io © 2022
  • Contact Us
  • Write For Us
  • About Us
  • Terms of Service
  • Privacy Policy

Type above and press Enter to search. Press Esc to cancel.