Busted! Don’t Believe These Bookkeeping Myths!
A bookkeeper is an industry professional who helps businesses track and understand their finances. By consistently tracking your financial data, bookkeeping can provide information about the progress and financial health of your business, thereby supporting your best decision-making for improved cash flow and profit.
However, many business owners assume some misconceptions which stand in the way of business success. To help you steer clear of the misconceptions, Freestone Associates has debunked three of the most widely believed myths about bookkeeping.
Myth 1: As a new start-up, you cannot afford a professional bookkeeper
As start-ups often operate on shoestring budgets, the assumption is that all available cash flow must go to revenue generation and since the bookkeeper is simply a cost centre it is not an essential requirement until after the tax year-end. However, a great bookkeeper is cost-effective and does provide a return on investment by improving cash flow, collecting receivables faster, avoiding costly pitfalls of unnecessary taxes, penalties and interest, and expensive issues with vendors.
Myth 2: Maintaining your books is a piece of cake
While online bookkeeping software has made maintaining the books less time-consuming, there are still so many errors that an untrained person can make. We have witnessed intelligent people double counting transactions, overlooking other material transactions, missing CRA deadlines, counting customer estimates as revenue, overpaying vendors, paying too much tax, and paying extraordinary amounts of penalties and interest to the CRA.
Hiring a competent and experienced bookkeeper will alleviate your stress and build your confidence that things are getting done right.
Myth 3: Bookkeeping is not crucial and can wait until the end of the year
Only the most simplistic businesses can get away with leaving bookkeeping to the end of the year. Waiting until the year-end will not reveal crucial insights to the growing business such as uncovering wasteful money bleeds, improving receivable collections, and improving cash flow.
To steer clear of these and other myths, reach out to Freestone Associates. We are passionate about helping small businesses to grow. Our founder, Kim Freestone, has over thirty years of experience which enhances our service offerings. Our services include cloud accounting solutions, accounting software setup, and support. We also offer QuickBooks training. We serve clients in and around the Greater Toronto Area from our offices in Etobicoke.