8 Mistakes Small Business Owners make with their Bookkeeping

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8 Mistakes Small Business Owners make with their Bookkeeping

So proud and loud at the premier top spot has to be doing it all yourself, so then;

  • Either you or your spouse/parnter doing it all yourself with no previous knowledge, although you were good at maths, so think that this will help you do it all correctly.  Hang on though, didnt you start this business as you were good at doing something and could make some money from it? And was that bookkeeping?  Think you get my point!
  • So number two has to be buying things on your credit card or cash and forgetting to put them in the system – then sitting and trying to work out why your accounts cant be reconciled, which again is something that must be done on a regular basis so that you know what is in the business and what is not.
  • Number three – Employees – ok so they only worked for me for three weeks, I don’t need to bother with paperwork etc do I?  WRONG, keeping accurate records means keeping HMRC off your back – do it!!
  • Ok, so half way through then, number four – bank reconciliation – how many understand what this means? How many understand the importance of it?  I rest my case milord!
  • Backup sits at number five – do you keep backups of all your records? Does it cross your mind that if something was to happen, do you really want to sit at your machine for three days solid, inputting the information all over again – I mean it took you long enough last time to understand where everything went – do you think you will remember?  So backups backups and more backups!
  • Number six – yep nearly at the end now – bank accounts – do you have one for the business and one for you? No??!!! Heck, do you really want to have to provide the Revenue with explanations and copies of all the major purchases you have done personally, but show up on the account as you decided there was no harm in using your personal account – good luck!!
  • Penultimate one then has to be VAT – oopps, sorry did I swear then?? Are you on the right scheme for your business (at this point some glaze over as they aint got the foggiest that there were different schemes), do you understand what you can and cant claim for? The last one alone is a good enough reason to get someone else to do it for you.
  • Ok, so finally then, yep we made it to number eight – losing paperwork …. arrrggghhh I hear cries of, ring any bells?  Yep HMRC to be polite, request (ok more order really) that you keep all your reeipts and statements and anything basically that moves for a minimum of six years – yep, six years of boxes full of paper that can stretch to many boxes, oh and don’t go and store them where the mice live – they like tearing up pieces of paper and having babies in them – there is a simple solution to this though – did you know that the Rev will allow you to store it all electronically now?

Ok so here comes the shameless plug then – well you knew it was coming – www.ftzaccounts.co.uk are mighty fine bookkeepers or if you are merely looking to get your receipts scanned in and formatted in a pdf and excel spreadsheet, might I recommend www.shoeboxaccounting.co.uk and on that cheerful note, I will leave you to ponder on why you didnt think of these!

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