If you’re doing your own accounting and don’t have training as a bookkeeper, it can be easy to make mistakes that negatively impact your business. Here are 7 common mistakes business owners make with their bookkeeping.
1. Missing deadlines and not being in compliance with CRA
This can cost you money in penalties and interest. For more information: what you need to know about government deadlines.
2. Incorporating your business or filing for GST/HST too early
Some expenses can be deferred. It can help to get some advice from a professional first! For more information: Do I need to register for GST?
3. Incorrect entries
Sub-contracting forms or payroll not completed correctly. CRA forms not completed accurately. These mistakes can be easy to make and hard to find.
4. Failing to reconcile your books
If you don’t keep on top of your invoices and outstanding bill payments, your cash flow can be affected negatively.
5. Misusing terms of credit
Offering terms without qualifying references or not taking advantage of vendor terms. This can also affect your cash flow. A qualified bookkeeper can help you set up accounts receivable and accounts payable systems.
6. Not having a budget
This can lead to a high overhead and not having cash to pay taxes, replace equipment or meet expenses.
7. Trying to do everything yourself!
Free up your time to run your business and get someone else to look after your books. An experienced professional won’t make the above mistakes and they can do your books more accurately and efficiently than you can.
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