3 Accounting Mistakes NYC Businesses Should Avoid

As rare as they may seem, accounting errors are undoubtedly a troublesome problem that any decision-maker should learn to be more mindful of, especially in tightly-run operations.


Regardless if you’re a small business that needs to control your finances or a sizable corporation that’s going through challenges to eventual growth, making even the smallest error can be fatal. In fact, experiencing a mistake today with your business’s numerical records and related tasks can lead to accompanying problems, such as:


  • Errors in records

  • Inaccurate forecasts

  • Over-exaggerated returns and incorrect budgeting

  • Incorrect valuation for IPOs and investor acquisition opportunities

  • Additional hecticness in regular financial processes


What makes it so important to be more proactive in avoiding any accounting mistake?


The main thing that anyone needs to know about accounting mistakes—whether big or small—is that they’re often the catalyst of even bigger problems in the future. Although most experts and novices alike claim that there are other more important problems to worry about and avoid, preventing accounting mistakes is vital for a reason. Compared to other problems that you’ll ever deal with, accounting fumbles are much more costly, frustrating, and time-intensive to remedy and handle. 


Various fumbles you need to avoid


Remember, the main mindset you need to uphold when dealing with potential accounting mistakes is that prevention is the best cure. If you want to ensure that your business doesn’t run into an unwanted issue with its finances because of fiscal fumbles, then you must be more aware of these mistakes to avoid:


1. Incorrectly calculating your cash inflows

Here’s one thing you need to know about avoiding common accounting mistakes: no one is exempt from the task of correctly calculating cash inflows. 


Unfortunately, thousands of New York businesses end up not being aware of this rule and incorrectly calculate their inflows out of sheer carelessness. Generally, miscalculated cash inflows are about counting your incoming payments and sales made before they’re even paid off or settled—which can lead to big problems. It may not seem like much, but recording a payment before it’s made or settled can lead to several inaccuracies in your figures that will get in the way of making accurate future decisions!


2. Failing to budget as you should

There’s no accounting mistake that could be more damaging than not having a well-planned budget in place. Keep in mind that your business’s budget is essentially what pulls all your finances together and keeps everything in line for better cash flow and financial stability. If you fail to deal with it properly, you could have a problem on your hands. Before you start to think about optimizing your liquidity ratios or tweaking your cost-saving strategies, take some time to build a dependable budget that will help you allocate your resources in the best way possible!

3. Being too stubborn to hire an expert

Not every business owner has the necessary experience and education to handle their numbers as well as they should—this is why outsourced accounting exists. By outsourcing an accountant’s services for your business, you essentially leave your accounting needs in the hands of a competent professional, such as Totally Booked’s experts. In fact, service providers have helped thousands of businesses and entrepreneurs alone with robust services that help maximize their processes by ten-fold!


Conclusion


As a business owner who is trying to keep the success train running as smoothly as possible, you must ensure that you’re dedicating much effort to avoiding common accounting mistakes. Once you become more conscious of the three most common fumbles mentioned above, all else will fall into place as you keep your financial work airtight! 


Totally Booked provides accounting and bookkeeping services that cater to businesses all over New York City with our various services—such as QuickBooks consultancy. With our help, you’ll be able to focus on what you do best while we increase your bottom line through efficient processes – get in touch with us today to see how we can help!

Kelly Gonsalves