Businesses can't survive if they are not capable of bringing in more money than they put out. Accounting accuracy is of utmost importance, especially if you're running a small business. Keeping accurate books lets you know whether or not you're actually generating revenue, among other benefits.
What does it mean to keep accurate books?
Maintaining accounting accuracy doesn't necessarily mean that you have to take a deep dive into your accounting records from years back. It also doesn't have to include the latest software nor does it entail seeking the help of a prestigious accounting firm. Keeping accurate financial records simply means maintaining a thorough, accurate record of all financial transactions involving your business, along with proper documentation of where funds are coming from and where they're going on a day-to-day basis.
How accurate accounting can boost your business value
1. Better financial stability
Maintaining accurate accounting gives you a better picture of your financial activity. It helps your business create and control company budgets so that it's clear when and how money is coming and going from your business. It also helps you plan for enough cash reserves to weather you through a crisis.
2. Enhanced marketing
Being accurate and up-to-date with your accounting also helps you make better revenue forecasts for your company. You'll have a better understanding of whether your current marketing efforts are working, or if they need further enhancement. Since marketing expenses have the tendency to get out of hand, maintaining accounting accuracy lets you know if you can afford to launch a new campaign, if your current campaign is driving the desired results, or when pricing and promotions affect your sales. If you lack financial data, it may be difficult to answer these questions.
3. Happier employees
Accurate accounting isn't just all about debits and credits. It's also integral to human resources. It gives you a better idea when to onboard additional staff or when you need to make the difficult decision of doing layoffs. It informs you if you're having a profitable year or if you're in the red. Having a clear idea of how much your business spends on salaries and wages, payroll taxes, employee benefits, and other perks, you'll be able to make better growth decisions for your business.
When you have hired the right people, keeping them happy is paramount. You should be able to give them the benefits and perks they need, including health, dental, and vision insurance, flexible hours, vacation time, work-from-home options, student loans, and tuition assistance, and so much more. Accurate accounting also aids in planning for and calculating salaries, vacation policies, sick leave, paid time off, medical benefits, and other aspects associated with employment.
Accurate accounting doesn't have to take a massive chunk of your time. There are tools and technologies out there that can help you with every facet of bookkeeping. However, in the event that you need expert advice and help from a reputable e-commerce accountant, get in touch with us. The E-Commerce Accountant is a reputable accounting firm dedicated to helping e-commerce businesses in Australia.