I'm always a bit concerned with the business owner taking the do it yourself bookkeeping approach. It is not that I think handling your own business bookkeeping is a bad idea, but not seeking help is. If a business owner wants to handle their own bookkeeping I always highly recommend that they at least consider our QuickBooks and bookkeeping training services. With general guidance we can teach you how to handle your bookkeeping on your own. It is much easier to set up and train someone on handling their business bookkeeping than it is to fix the mistakes they most likely will make on their own. I do recommend that owners learn some bookkeeping basics as it helps them understand financial statements as they grow. However, I very rarely advise someone to attempt their bookkeeping without some professional assistance. Here are a few things to consider before you attempt your bookkeeping on your own.
Unless you are a bookkeeper by trade then you are not a bookkeeper. If you went to school for business you most likely took a few general accounting classes, but are you really ready to handle your own bookkeeping? As a small business owner your focus should be on growing your small business. You need to consider the opportunity cost of attempting to handle your own bookkeeping. Are you actually going to save money by handling your own bookkeeping? Is your time better spent handling other growth oriented tasks? Are you really willing to make mistakes from decisions off of inaccurate financial reports?
If you decide to handle your bookkeeping completely on your own you are most likely going to make some mistakes. Knowing the difference between an expense, asset and liability is crucial. If you are already confused then you need to think twice about do it yourself bookkeeping. As an example, if you record a large purchase as an expense that should be booked as an asset and then depreciated over time you might have a major problem. This would lead to an inaccurate tax filing and you would be responsible for your mistakes in the end. The more likely scenario is that your small business financial reporting will be incorrect. Using inaccurate financial reports to make decisions can have a lot of negative outcomes. If you make mistakes in your bookkeeping then you don't have a true way to measure how your business is actually performing.
Not A Powerful Bookkeeping System
Another concern with doing your own bookkeeping is that you might not get the most out of QuickBooks, which can really short change your business. You should be able to use your bookkeeping as a business tool to aid you in making key decisions. I have yet to train a business owner in QuickBooks that I was not able to demonstrate how to use the program to help them run their business more effectively. Sometimes a custom QuickBooks report can provide valuable information to a business owner that was not available to them before. Other business owners need to be shown how to use QuickBooks to manage cash flow. QuickBooks is a powerful program that can be customized to meet your specific needs. However, you have to know the capabilities of the program and how to modify it to meet your needs. Just handling the basic day to day bookkeeping is not that difficult but you should be taking it further and extracting valuable information from your bookkeeping system to help you increase your business profits.
If you want to handle your own bookkeeping I totally understand, but I wouldn't recommend attempting your business bookkeeping without the help of a professional. Handling your own bookkeeping will actually teach you a lot about your business and as you grow understanding your bookkeeping will be beneficial. If you do get some bookkeeping consulting help in the beginning to get the system set up properly you should be able to avoid errors, increase efficiency and develop a powerful bookkeeping system that can help you grow your business.