Making the decision to gain control of your accounting system is one of those things often added to the "someday" list. You know your company needs accurate accounting... but maybe it feels like a task that can wait. Other business activities always seem to take precedence. Perhaps the fear of change and the unknown is holding your back.
Does this sound familiar? 8 reasons to stop procrastinating TODAY :
CREATE/CONTROL BUDGETS
Accounting helps business owners create and control company budgets. When you know how your money is coming in and going out, you are better prepared to monitor business budgets. A company without budgets is like a ship drifting at sea without a captain; accounting helps ensure your business isn't heading for a Titanic-style iceberg.
FORECAST REVENUES
Business owners who pay attention to their accounting are informed and better able to forecast revenues for their company. Revenue forecasts help you understand whether current marketing efforts are working or whether changes need to be made. If you can't forecast revenues for your company, you won't know whether it is safe to make business-related expenditures.
MAJOR BUSINESS PURCHASE DECISIONS
Speaking of expenditures, accurate accounting helps business owners consider the ramifications of making major business purchasing decisions. From a new building lease to company vehicles, major expenditures can have a significant impact on monthly cash flow. When you monitor your company's accounting on a regular basis, you can make an informed decision on purchasing new assets for your company.
TRACK BUSINESS EXPENSES Accounting helps you to track your business expenses. Whether you are attending industry conferences or fueling your vehicle to make sales calls, monitoring your business expenses is an essential part of owning a company. Little expenses can add up over time; a wise business owner tracks these expenditures on a daily basis via their accounting software. It’s a good practice to snap a picture of every receipt you receive and send it directly to your accounting software.
MONITOR BUSINESS FINANCIAL HEALTH
Accounting helps you to monitor the health of your company. Too many expenditures without an adequate cash influx spells trouble for any company. If detailed accounting isn't part of your modus operandi, how will you ever know if your company is succeeding or failing? Investing in detailed accounting helps you keep your finger on the pulse of your company's financial health.
PERSONNEL DECISIONS
Accurate accounting records can also help you make personnel decisions. Knowing when to bring on additional staff, or when to lay off employees, can mean the difference between having a profitable year and being in the red or not. When you understand how much your business is spending on payroll (including payroll taxes), you are better prepared to make growth decisions for your company.
ACCURATE RECORD KEEPING FOR FINANCIAL INSTITUTIONS AND/OR TAXES
Accounting also helps you keep accurate records for financial institutions and tax preparation. Applying for a business loan will require detailed company financials. If you don't provide accurate business books to your tax preparation team, a complete fiscal tax audit could be in your future. Not only does accounting help you grow your company, it helps prevent damaging events like fiscal audits.
MONITOR BUSINESS GROWTH
The ability to monitor business growth is one of the top benefits of detailed business accounting. When you know your assets, liabilities, and on-hand revenues, you can easily track the growth of your company. You'll know whether sales targets are being met, whether your social media and content marketing strategies are working, and whether your accounts receivable and accounts payable obligations are being met.
