When you started your own business you started with passion and determination in your mind. As an entrepreneur you may have more important things to do than accounting. However accounting still remains the integral part of your business. Investing in your company’s accounting needs should be considered critical. A messy book of accounts or accounting done with cheap resources could prove to be more problematic in future. It could cause hindrance in growth of your business or all together closing your company.
Below are 5 mistakes which you can avoid by being mindful and cautious to be one of the Best Accounting Outsourcing Companies in Dubai.
1. Avoid cheapest available resource
Well, well, well accounting skills is not something which you can pick up on a sale from supermarket. While you can always find affordable options but be mindful of what you get. Many businesses have receptionist, spouse, sales person etc doing their accounts or hire an accountant which charges less salary as his/her accounting skills are very minimum. This could lead to many financial dents in future. Try to see what an optimum salary for accountant in market and find a decently experienced accountant depending on your business scale. If hiring is an expensive or not possible option (have space constraint for accountant like a salon business) then try outsourcing it to a accounting firm.
2. Avoid writing your own accounts
As we said earlier that as an owner you have much bigger and much more important things to do then writing your own accounts. If an owner decides to write his/her accounts most of time it’s not done at all or done in a very partially manner. From costing point of view also it’s very inefficient. If an owner spends his precious towards developing his/her business it’s much valuable then writing accounts which could be done or outsourced at a much cheaper price.
3. Try not to mix business money with personal money
This is easier said than done. It is very convenient thing for an entrepreneur to mix business and personal money. In early stage of business money flows from owners personal account to business account and in later stage of business it is other way round (talking from our experience). All entrepreneurs know that they should have a company bank account and all the business related transactions should be done from that, but how many actually follow it? Well if you have a good accountant (here we mean pushy and tough) accountant he/she will make sure you follow this basic rule. The benefits reaped are correctly done accounting and clear view of your cash. More on benefits of correctly done accounting in our future article.
4. Use appropriate software for doing accounting
At different stages of your business you need different tools to run your business efficiently. Accounting software is one of them. A giant retail company could be using very expensive high end erp software but the same software could be of no use to a multi chain restaurant. As an entrepreneur you need to identify your needs and pick appropriate software. Xero, Quickbooks, Zoho books, Tally, Wave, Sage are few of the popular options used for accounting. Excel is a great tool and used by many accountants worldwide but not for accounting certainly. It is doesn’t have a double entry system which is basic and bare minimum for accounting system. We prefer cloud based accounting system for being Accounting Outsourcing Companies in Dubai due to it’s many advantages over desktop based accounting software. More on benefits of cloud based accounting software in our future articles.
5. Remember to record your petty cash expenses
Small expenses done for company are simply ignored by owners. They spend from their pocket and forget to record it. These expenses may seem small to worry about but if you see your yearly petty cash expenses it would be a decent amount which you as owner should be aware about. Also theses expenses could be part of your tax returns which you may miss out claiming if you have not entered in accounts. So this is clearly loss of money. Would like to add one more step here. Match your actual bank balance with accounts bank balance. This is called reconciliation of bank balance. There could be many small expenses for which you paid from your bank. Matching the balance ensure that you record all your bank transactions so that even smallest expenses are not missed out.
Investing in your company’s accounting needs should be considered critical. We as Accounting Outsourcing Companies in Dubai provides Cloud Accounting Services and also believe that every business need to have a proper accounting function to make informed business decisions.
Hope these simple tips helps with your business accounting decisions. If you have any further questions and want to know more please write to us at [email protected] or visit us at Accountant’s BOX