As we are aware of the fact that every business house either is of small size or a large size Multinational Company needs to prepare their books of accounts as per their convenience and as acceptable by the government for various other statutory requirements. Small and medium business houses are always face challenging in preparing their books of accounts and those challenges directly or indirectly lead them to do some mistakes. In this article we will discuss the most common 8 of the business mistakes which are committed by small business houses along with the solution to them:
- Lack of knowledge of Accounting Principles: The main problem is that the small business houses do not have basic knowledge of their accounting principles and due to which they generally book their profits calculated on the wrong basis and this may also lead into the closing of the deal with their customer at the wrong price. Here how we can support you by our AKT Macs service in which various significant decisions can be asked by our clients and we can help them with that along with accounting services.
- Not understanding the importance of accounting seriously: Many of the small businessmen are not keeping proper records of their transactions as they are of the view that these small transactions do not create any impact if any of them is left out. But they do not understand the seriousness over this as these small mistakes of ignorance may result in a large amount defalcation which may also create negative Impact over their statutory records.
- Treating employees and job workers as same:– Generally, they treat both the job workers or contractors the same as employees employed by them. Understanding these issues may also affect your tax liabilities as there are different treatment in Income tax as well as GST of both employees and job workers.
- In house management of your books of accounts:– If you are maintaining in house accounting records by hiring an accountant to visit your place who is preparing your records may cost you to hire that person along with getting the infrastructure ready to get your books completed. In this case, if you have a small business then this decision may be your mistake to invest or spend huge money in this with a little revenue. So, to cure this we are offering our service through our product in which you will be charged as per your business without investing in any infrastructure to get your books ready.
- Skipping of timely reconciliations:– You may of the view that your business is small and you not need to prepare timely reconciliations due to lower number of transactions may result in huge variance in future because there could be the chances of missing of any line item and as you are not reconciling this on a frequent basis then you may not even to plug the variance arise due to that.
- Not recording small or petty transactions:– If you are of the view that you can miss small or petty amount transactions and they will not affect your business then you are doing a blunder here because it will not only result in a heavy difference in future but may also result in the imposition of heavy penalties over you due to non maintaining books properly and escaping of transactions from government departments. We understand a small businessman cannot handle these petty issues that’s why we came up with our AKT Macs service so that you can focus on your business and we can focus on your error-free accounting.
- Miscommunication with bookkeeper:– If your bookkeeper is not communicating with you timely and there is a communication gap between you and your bookkeeper than it is a huge mistake as it will definitely result in the recording of transactions with some flaws which will result in a report full of error due to lack of proper information and communication between them. So having a professional who takes care of all these things and communication so that your books can be prepared with quality is necessary.
- Assignments of budget to projects:– Irrespective of the size of the business, budgets should be prepared and properly allocated to each project and in case of any deviation between budgeted amount and amount actually incurred to complete the project, the necessary action could be taken and benefits could be attained. If your budget allocations are not proper then you may face losses due to your improper cost management. That’s why we are not only providing accounting services but also advisory services to frame realistic and profitable budgets by our team of professionals in this field through AKT Macs.
So, you must make a wise decision after all the discussion which is important to your business no matter it is small or medium, you can take it to the higher level with our professional advice and deliverables. After this discussion, you will also realize that you are doing these mistakes and getting effected because of this. So, no harm in getting any trial to the solution of these problems especially if it is provided by the team of professionals and experts.