8 Ways DIY Accounting Costs More Than It Saves
No matter how much they hate it, small business owners tend to do their own accounting. They’ll tell you they’d love to hire a bookkeeper, but they just can’t justify the expense.
What they don’t take into consideration is all the ways a professional CPA can cut business expenses, take advantage of savings opportunities, and avoid costly mistakes. Here’s what having a good accountant can do for you:
1. Find more tax breaks.
A good business accountant will claim expenses you may not have known were deductible. They can also advise on the timing of major purchases to take full advantage of tax credits and depreciation.
2. File taxes on time.
Late returns and other compliance paperwork will incur penalties and interest.
3. File accurate taxes.
Under-reporting how much you owe could lead to big trouble with the IRS, as well as state and local authorities if you collect sales tax.
4. Send invoices out on time.
An accountant will help you avoid a cash flow crisis by keeping up to speed with invoicing.
5. Track late payments.
Well-kept books should show you at a glance what you’re owed and when it’s due. No more need to spend time and money on collections efforts.
6. Eliminate data entry errors.
For the DIY bookkeeper, figuring out and fixing the mistake could take hours — which the small business owner could spend more profitably elsewhere.
7. Provide information for smart business decisions.
You should be able to spot right away when there’s an issue with cash flow, inventory, or profit margin, and take early corrective action. On the flip side, your accountant can point out opportunities for growth or reducing unnecessary costs.
8. Free you up to add value to your business.
Is it a smart use of your time to be doing data entry, tracking invoices/payments, reconciling bank accounts and control accounts, processing payroll, managing inventory, preparing tax documents, and so on?
“But I still can’t afford an accountant”
The benefits may be clear, but most owner-managers just don’t have the budget to add a full-time professional accountant. As small business specialists, we understand your position. That’s why we offer affordable monthly plans that cost less than half of what a traditional accountant typically charges (in a couple of hours!).
How to make the best use of your accountant
When you hire a professional consultant, you want to take advantage of the team’s expertise in showing you how to save money and make your business more profitable. You’d rather not have them spend all their time on routine tasks.
That’s why Xendoo uses state-of-the-art software that automates many such tasks, from entering sales transactions directly from your bank into your books to coding each entry as it happens so there’s no last-minute rush at tax time. Your accounting team is free to provide you with valuable advice, and you’re free to focus on your core business. Not to mention getting a good night’s sleep.