4 Quickbooks Beginner Mistakes You Must Avoid - What to Know

For a small business, bookkeeping and accounting can become excessively time-consuming and complicated. Handling the accounting side is definitely one of the more difficult, yet necessary parts of having a budding business. Thankfully, QuickBooks is there to help you through the initial parts, allowing you to stay on top of your operations.

Through this nifty little accounting suite, your business’s accounting and bookkeeping are made so much easier. While extremely user-friendly, however, getting lax and letting it do everything can result in some pretty big mistakes.

To help with this regard, here are four of the most basic mistakes that beginners tend to do when they start using QuickBooks services.

Forgoing the need for an accountant

One of the most common and basic mistakes is to forego the need for an accountant to handle your business. At the beginning of your business, this may prove to be much easier, especially with the help of QuickBooks’ software automation. Although it may make the accounting and bookkeeping side of your business drastically easier, it doesn’t magically put you on the same level as a certified accountant.

While you may have a rudimentary knowledge of basic accounting, even some of the most basic accounting rules required to have clean books for your business might escape you. Outsourcing bookkeeping services can yield a lot of savings in the long run and can earn you lots of valuable insights and advice from a professional.

Not prioritizing bookkeeping

Although tedious and often boring, bookkeeping is an extremely vital part of maintaining your business. Maintaining good accounting records, reconciling bank and credit card transactions, and categorizing entries are all as important as handling the production, the operation, and the sales of your business. Being on top of your bookkeeping allows you to understand your cash flow needs, set appropriate profitability goals, and prepare ahead of the tax season rush. 

Irregular updating

Updating your accounting record and consolidating your bank statements are necessary to be done as regularly as possible. Doing this on a nearly daily basis can help you monitor your business more effectively and allow you to plan ahead. Failing to do it on a near-daily basis will go against your capability to manage your business’s cash flow needs in the long run. Consolidating regularly will also allow you to ensure that your bank’s cash flow is in line with what you expect it to be. You might see doubled transactions right away, so you can remedy the situation, which can be much more difficult if left alone for a prolonged period of time.

Going with a cash-basis rather than an accrual basis of accounts

Most small businesses prefer generating accounting reports using the cash-basis method. Unfortunately, it can become problematic in the long run. The accrual method, on the other hand, is the accepted form that is compliant with the Generally Accepted Accounting Principles (GAAP). If you’ve been using the cash-basis method, then QuickBooks can resolve that with the simple touch of a button.

Conclusion

Using QuickBooks may make accounting and bookkeeping easy, but some precautions and knowledge will help you avoid a few basic mistakes. Taking note of these four common blunders can really help you push your business further. 

If you’re still having trouble, then approaching a QuickBooks certified bookkeeper and consultant in New York is your best bet. Get in touch with us now and schedule a consultation today!