Home » 4 Common Myths about Small Business Accounting and Bookkeeping Debunked

4 Common Myths about Small Business Accounting and Bookkeeping Debunked

Rahul Maingi

By admin, September 24, 2018

Share this...

4 Common Myths about Small Business Accounting and Bookkeeping Debunked

Whether small-scale or large-scale, accounting and bookkeeping are the important aspects of any business. The financial health of your business and prospects of success largely depends on how well you handle these two departments. But, the misconceptions and stereotypes about bookkeeping and accounting make the entrepreneurs negligent in this regard. As a result, the business becomes vulnerable to financial fraud, security breach and other unfortunate consequences.

Being the most trustworthy virtual bookkeeping company in Toronto, we understand how important it is to clear these misconceptions. That’s why our team has debunked four common myths about small business accounting and bookkeeping.

1) Small Businesses Don’t Need an Accountant or a Bookkeeper

Many small business owners believe that they can handle the bookkeeping themselves because of the smaller scale of their business. Similarly, they are of the opinion that hiring an accountant is not required. But, the fact is hiring a professional bookkeeper is necessary as he/she can record error-free transactions regularly and keep your books updated or else it can create complications at the time of calculating revenue. Also, an efficient accounting system is necessary for every business which can be done only by hiring an accountant. He/she will manage your accounts and help you fulfil your tax obligations.

2) Accounting Is Only Important at Tax Time

One of the common myths that can make you land up in trouble is that you need to focus on accounting only at the time of calculating and paying taxes. It is true that accounting is crucial at tax time but certainly, it is not the only important time. It is necessary to pay attention to your financial statements at all times of the year and ensure that it is updated. This practice helps in making your tax filing easier, mitigating risks from any source and taking advantage of the growth opportunities.

3) Using an Accounting Software Will Do Everything

Using accounting software like QuickBooks will definitely ease out several accounting tasks but it is not a replacement for hiring bookkeepers and accountants. In fact, human support will be more crucial when using a software. The reason is software can help you keep information organized and make business decisions but it can’t figure out whether the information is right or wrong. You need a professional to analyse the data and fix mistakes whenever they occur.

4) Outsourcing Bookkeeping and Accounting Services Will Violate Security

Small businesses who don’t have the budget to hire dedicated bookkeepers and accountants hesitate in outsourcing these tasks because they believe this might violate their private information and security. But, this is not true. A professional online accounting and bookkeeping service provider will never disclose your confidential information at any cost. Many service providers use data encryption algorithms to ensure maximum security. Feel free to outsource accounting tasks and concentrate on other aspects of your business for growth.

Hopefully, we have debunked several myths about small business accounting and bookkeeping with the help of this blog post. Many entrepreneurs might find these financial tasks intimidating, but they are integral parts of a business. Clear all your misconceptions and work with professional accountants and bookkeepers to achieve your business goals. If you have any other misconception, feel free to contact our remote bookkeepers to clear your doubts.

The Virtuous Bookkeeping explores ways for entrepreneurs to enjoy independence and better run their business. Join over 10,000 subscribers and get our best articles delivered via email.

Book a Free Consultation