4 accounting mistakes new and startup businesses must avoid
While you should be excited to be taking a new step in life, starting your own business can be a challenging and frightening process. You need to make sure everything is in order, from employee performance to hitting those all important sales targets.
One area that should never be left unsupervised, especially during the early days, is your accounts. Too many startup businesses fold due to simple, avoidable mistakes. Here are four accounting mistakes you must avoid to succeed.
Not knowing your accounting software
Too many businesses invest in accounting software but don’t take the time to understand how it works. Learning your accountancy software is paramount to its performance within your business and will help create more accurate reporting. Without having full working knowledge of software like Xero or Quickbooks, you could end up making costly mistakes. Have a look at our online accounting packages that could help you save time and stay up to date with your business finances.
Not keeping track of your expenditure
The first few years as a new business are strenuous and trying to keep track of all your business activity can be tiring. Losing receipts, failing to make expenditure entries and fluttering money is unacceptable when you’re trying to get your company operations up and running. You need to be vigilant of your spending. You may be hit with major penalties if you don’t account for all your expenditures during an HMRC audit.
Making simple mathematical errors
This might sound silly but heavy fines are often levied as a result of simple math mistakes. Mathematical errors can also seriously alter figures, which can snowball into a larger problem further down the line when completing tax returns and payroll. Always double-checking any math solutions will help eliminate this problem.
Hiring an inexperienced accountant
While you may need to cut corners at first, hiring someone untrained for bookkeeping is not an option. Startups that hire an inexperienced family member or friend to do their accounts are often the first to fail. When it comes to money, hiring someone with the right training and knowledge is essential to your success. Working with a chartered accountancy firm, such as ourselves, could help you and your company in the long-term.
If you’re a new business in Sussex, our chartered accountants can help you today. Contact our offices in Seaford or Uckfield for more information.
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