Is it Time to Upgrade your Accounting Infrastructure?

I’ve stated before in a previous blog post that quality accounting infrastructure is essential for properly managing a business. So how do you know if your infrastructure needs to be upgraded? Here are several signs:

It’s reliant on spreadsheets

These are low-cost alternatives to paying for accounting software, but there are trade-offs. Aside from having to build an effective and efficient spreadsheet from scratch, the opportunity for catastrophic error from accidentally deleting a crucial cell or tab is very present.

Decisions are based on intuition and hunches despite the existence of accounting data

This could be due to inaccurate or incomplete information, or it could be because nobody is reliably producing reports from the system on which to make decisions.

Missed filing deadlines – or filed on time, but inaccurately

If income tax returns and sales tax returns are not being filed correctly, it could be costing your business thousands of dollars that you can’t afford to lose. For example, if you are filing sales tax returns with incomplete revenue information, you would be under-remitting and thus potentially exposing yourself to a painful audit down the road.

Significant manual transcription of data between sources

For example, if your POS system doesn’t automatically sync sales and deposit data to your Quickbooks file, you would need to transcribe this information manually. As is the case for any kind of manual data entry, the opportunity for mistakes is substantial.

Nobody is reviewing accounting output for quality

If there’s nobody in place who can spot low quality accounting information, you as the owner could be making decisions based on a faulty premise. This is where human expertise shines.

Do any of these signs sound familiar in your business? If so, please reach out to me!