Did you know that accounting processes began more than 7,000 years ago? The Assyrians began a process that relied on primitive accounting methods to properly record herd counts and growth of crops. Now, 7,000 years later we are still counting cattle numbers but also the number of times we hit Starbucks each week and the dollars we spend in fuel each year to get from here to there. Accounting methods have become much more advanced and thankfully, software systems have been created to help with the accounting process.
However, as a professional bookkeeper, I can tell you with certainty that there are some people that should NOT, with all due respect, try to keep their own books. Smart Book Business Solutions has run into many accounts that we call “humdingers “. “Do-it-yourselfers” have the best of intentions to save some money or believe that bookkeeping just “isn’t that hard”. Unfortunately, sometimes it does not get done correctly and they have actually created a much bigger mess to clean up and correct.
Let me give some of you “do-it-yourselfers” a bit of advice; when entering a banking transaction to pay your credit card, don’t expense your payment to your credit card as “credit card payment”. If audited, the IRS will simply say, “I don’t care that you’ve paid your credit card through your business account, I want to know what you bought with your credit card?” The business credit card must be added to the balance sheet accounts and charges to your credit card must be expensed properly. There is no IRS deduction for “credit card payment”. However, there are deductions for office supplies and utility payments.
We have come across so many business owners that have good intentions and want to save money by not hiring a professional. But I have to be brutally honest that these folks are usually the people who end up spending more money in the long run because of the clean-up work that has to take place when a professional finally gets ahold of their books. Let me assure you that the peace of mind that you and your CPA will feel knowing that a professional bookkeeper has been tracking your finances is PRICELESS. And it will take us half the time as it takes you because this is what we LOVE to do! Folks, please delegate this important function from the beginning and have it done correctly! Talk to a business coach and I promise they will tell you the same thing!