| Many small businesses are operating without up to | | | | determine each partner's share of profits or loss, |
| date accounting record, or timely periodical Booking | | | | leading to mistrust among partners. |
| write-up. Business owners are sometimes undecided | | | | The longer the delay in preparing accounts, the more |
| as to whether they should outsource or prepare | | | | difficult it will be to investigate and remedy past issues |
| accounts in-house. This is sometimes caused by cash | | | | that affect the accounting. This is so because the |
| shortage, or just a careless approach to business by | | | | details of what really happened 6 months or 1 year |
| the owners. Below we examine some disadvantages | | | | ago is not always easily recalled. |
| of delaying the accounting and Bookkeeping functions. | | | | All operations should have some system of internal |
| A businessman who operates without accounting data, | | | | control and procedure to minimize fraud and errors. In |
| will not know how the business is performing. There | | | | this regard,the timely preparation of accounts and |
| might be some cash in the bank, but this is not the | | | | bookkeeping write-up will aid the compliance with |
| same as profit. He needs to know in a timely manner, | | | | internal rules and regulation. |
| how his business is doing. He needs to compare | | | | Some business managers prefer to do the books |
| accurately documented revenue with matching | | | | themselves, but in many instances they don't have the |
| expenditure, to see if he is making a profit. | | | | time or expertise to do accounting and take care of |
| When there is a lack of accounting data, the presence | | | | operations. There are likely to be errors because |
| of pilferage or fraud may not be detected before | | | | business owners are usually not good at accounting |
| much is lost. The guilty employee might have departed | | | | and Bookkeeping, and errors in the reports can cause |
| before the discovery is made, so that any chance of | | | | inappropriate actions to be taken that will have |
| recovery is lost. Often in a small business, there may | | | | adverse effects on the operation. |
| only be the owner and a bookkeeping help. The | | | | At other times business owners try to reduce |
| bookkeeper, who may be having personal financial | | | | expenses by not employing someone to do the |
| difficulties, takes a small amount of money intending to | | | | bookkeeping, or is opposed to Bookkeeping |
| pay it back. No one notices, so more is taken. Over a | | | | outsourcing, but in the long run this decisioncan be |
| period of time, it starts to mount up to a lot of money. | | | | more costly than the cost of getting the books done |
| Timely preparation of accounts, examined by the | | | | by a bookkeeping freelancer. |
| owner, can help to prevent this temptation. | | | | In summary, timely accounting and bookkeeping is |
| Correct information is needed at intervals to calculate | | | | essential to every business. It provides a feed back to |
| sales, use and other taxes, and to meet other | | | | the owner on the results of operation for a period. |
| statutory obligations. Proprietors will be penalized for | | | | Without it he is operating in the dark. When the results |
| late payment of taxes, for errors in tax computation, or | | | | are available, it becomes the owners responsibility to |
| the absence of payment. If the books are not up to | | | | take remedial action where necessary, to correct any |
| date these tax computations will be difficult. | | | | adverse discoveries. There are numerous |
| Where there are partners, or more than one persons | | | | Bookkeeping freelancers who are qualified to help in |
| running and benefiting from the business, the lack of | | | | this regard. |
| accounting information will make it impossible to | | | | |