5 Reasons You Shouldn’t Wait to Catch Up on Bookkeeping in 2023
Running a business is, without a doubt, a challenging task that requires a lot of commitment, effort, and attention to detail. Did you know 82% of small businesses fail due to cash flow management? Besides managing all aspects of the business, taking care of your books is crucial to achieving financial success while being tax ready all year round.
At Xendoo, we know you didn’t start a business to do the accounting and taxes; but we did. In this blog post, we’ll explore the necessity of catching up on your bookkeeping and how it will benefit your company.
To start, let’s look at why keeping your books up to date year-round will help your business.
1. Avoid an audit
Filing your business taxes on time, will avoid hefty fines or legal action and keep your financial health in good shape. Even if you can’t pay in full, the IRS will work with you. By staying on top of your bookkeeping, you avoid further issues and stay on good terms with the IRS and other regulatory agencies.
2. Obtain a business loan
Consistent bookkeeping also makes it easier to obtain a business loan and improves the application process. Up-to-date financials give you a clear picture of your loan needs, so you know how much funding you need.
Lenders want a solid financial history and a clear picture of your current financial health. That way, you increase your chances of securing the funding you need to grow your business.
3. Avoid costly mistakes
Consistent bookkeeping helps you avoid mistakes such as:
- Heavy inventory
- Inaccurate invoices
- Predatory lending options
- Accounts receivable and accounts payable errors
An online bookkeeping service that provides 24/7 access to financial experts and reporting all year will alert you to mistakes quickly and even prevent them. It can also help you make objective business decisions that contribute to your success.
4. Identify fraud and errors
Keeping your financial records up-to-date can help you identify potential fraud or errors. Regularly reconciling your bank accounts, credit card statements, and invoices can help you quickly catch any discrepancies and take appropriate action to rectify them. Doing so can protect your business’s financial integrity and prevent losses due to fraudulent activities.
5. Focus on growth, not your bookkeeping
Now that you’ve secured funding for that second location (or that expansion) and got caught up on your books, you can focus on growth. When your books are in order, you can devote your time and energy to other business areas, such as marketing, sales, or product development.
Xendoo makes a great partner whether you need help getting caught up or staying up to date on your bookkeeping.
Achieve financial peace of mind with up-to-date bookkeeping and enjoy the benefits of a healthy and thriving business! For more benefits about keeping your books current and staying on track with your business needs, visit this article.