Having transparent and comprehensive accounting records is fundamental for your business’s success. Without solid internal controls, you may face errors in the accuracy of your accounting records, which can cause expensive and time-consuming obstacles that may snowball into other errors and keep your business from growing.
For example, inaccurate Accounts Payable for year-end can throw off Cash Flow reports, which are necessary for understanding profit and losses, spending, projections, or be approved for lending. Business owners rely on the accuracy of financial statements to view the company’s health. Having inaccurate accounting records can trigger red flags for audits, the need for restatements of earnings involving regulators, and pay more in fines and penalties, or in some cases force businesses into bankruptcy.
The biggest issue for business owners is that inaccurate accounting records lead to making uninformed decisions or choices. It can also be the reason for failing to secure lending and getting better rates on general liability insurance. Inaccurate accounting records could cost you to pay more in taxes because of categorizing costs incorrectly or in non-tax advantaged accounts. Not all items are black and white, there is a lot of subjectivity in accounting that should be considered. Whether it’s creative accounting, unintentional human error, or severe intentional violations, inaccurate accounting records can lead to quality integrity and loss of reputation.
WORKING WITH ACCOUNTING SENSE
Having inaccurate accounting records does not have to be negative to you or your business. Let our team work with you and ease yourself from the burden that poor records can bring you. We are here to make sense of your accounting records by taking preventative measures and help when your company faces an audit. We will structure your financial statements and present in an easy-to-understand format and to provide reasonable assurance of the financial statement’s integrity for presenting appraisals, estimates, and forecasts.
Accounting Sense can help gain control by working with you internally to establish the proper accounting structure for your business. We use Generally Accepted Accounting Principles (GAAP) and integrate a system that considers your business model and goals, allowing you to easily see trends and insights into your day-to-day business practices.
Manual record taking make it easy forget entries, and for smaller businesses can throw wrenches into the processes if your staff is not trained for bookkeeping. We integrate automated solutions and organize your chart of accounts to help eliminate human error and stay compliant while seeing real time where your business stands for better projections and decision making.
“As companies acquire other companies, they typically inherit a hodgepodge of different IT systems that fail to ‘talk with’ their systems and rarely become fully integrated. Finance professionals are inundated with complex financial data coming from different systems, trying to make sense of it all. It’s a struggle.” (Banham, 2019; Article; Banham, 2019).
Our SAM model is here to help!
Additional Information
Accounting Tools. (2023, November 13). Financial reporting definition. Retrieved from Accounting Tools: https://www.accountingtools.com/articles/what-is-financial-reporting.html
Banham, R. (2019, September 3). Wrong Numbers: The Risks of Inaccurate Financial Statements. Retrieved from Risk Management: http://www.rmmagazine.com/articles/article/2019/09/03/-Wrong-Numbers-The-Risks-of-Inaccurate-Financial-Statements-