Sins in the Bookkeeping World 

Posted On June 27, 2023June 27, 2023

Bookkeeping is not an easy task. Therefore, it is easy to assume that there is plenty of room for mistakes. While some mistakes are minor and can be corrected, some can be devastating for your business. Knowing which errors you should take seriously and work on is important. These are also called the deadly sins of bookkeeping.

If you are new to bookkeeping and unsure about what you are doing, you should probably hire an expert. Bookkeeping and managing finances are not easy, and minor errors can cause problems in the business. Hire CPAs accounting services to ensure that the job is done right. Meanwhile, here are some of the bookkeeping errors to keep in check. 

Sins in the bookkeeping world 

1. Mixing personal and business expenses. 

Keeping a single bank account where you keep your personal and business-related money is a major mistake many small businessmen make. You will be filing your business taxes separately from your personal taxes. So, make sure you first create a separate bank account to not get your expenses mixed up. Such kinds of mistakes can result in you being audited by the IRS. 

2. Using a paper-based system instead of software. 

The world has gained significant success in developing different kinds of software to streamline business-related tasks, and it is nothing but silliness not to take advantage of the latest technology. Some people still use the paper-based system simply because it is something they have used all their life, or they are reluctant to use technology due to a lack of knowledge and experience. 

Using software saves you time, money, and effort. You will have all your records in one place and can access them with a few clicks. If there is an error or discrepancy, you can find it easily instead of having to go through piles of paper. 

3. Not keeping track of receipts. 

Business owners, especially ones who have opened a new business for the first time, sometimes do not realize the importance of keeping a record of their receipts. Receipts are evidence to support tax write-offs to the IRS. Without a receipt, you would have no proof to claim an expense on a tax return. Keep all the receipts in a safe and click pictures of each to store them digitally. 

If you own a business, you should be educated on these bookkeeping sins, and if you are already making one of these errors, there still might be time to fix things. Hire an accountant today.