Donna Genie (YouTube video, Dec 14, 2023) urges entrepreneurs to keep tidy books and records, illustrating with a case where mis-entered and duplicated payment data flowing into QuickBooks Online caused an overstatement of income that would have cost a client over $40,000 in taxes. With cleanup and corrected records the error was fixed, the client recovered the funds, and Genie recommends investing in proper accounting practices early to enable business growth.
Today, let's talk about a super important tip for all you entrepreneurs out there that is keeping your books and records tidy. I know that's every accountant preaches it, but I want to tell you an example of why this is so important. Did you know that just organizing your finances can save you a ton of money? Yeah, that's right. It's not just about the neatness. It's about how you record things and the tax savings that come along with that. Let me tell you a quick story. We had an entrepreneur approach us who'd been doing his own books. In his first year of business, he a little short on cash and kind of running it on a shoestring, but things ended up going pretty well. So he was a little casual that first year and brought us all his information. And honestly, he needed a little cleanup. We were getting ready to help him employ some new systems and looking through and cleaning up his past records. He had filed his tax returns with a tax preparer prior to working with us. So he brought those along with us. They thought they had everything under control, but there were a few misplaced clicks here and there, and that accounting software led to some big mistakes. Now, software doesn't make the mistakes. It's the way you put it in. So garbage in, garbage out. Guess what? These little errors along the way caused his income to be overstated and cost him over $40,000 in taxes. As I mentioned, his business did take off pretty quickly. So the timing of which he thought he had everything under control. And then by the end of the year, things were going really well. That led to a recipe for disaster here. So turned out in that $40,000, we were able to make some corrections because he had his payment processing system set up a little wrong. How it flowed into QuickBooks Online, duplicated some things, and those little culprits led to this $40,000 discrepancy. Now, just looking at things on the surface, you might not have even noticed it. But with a trained eye, when we're doing our conversion and looking back to spot any problems and issues, that's where we found it. So if this had gone unnoticed, he would have probably paid that $40,000 and never known the difference. But with our help, we were able to correct that. Go back, give him the $40,000, and then start tracking things the right way, knowing that you have good, solid information to manage his business. Today, he's on an even better road to success, and things are going really well with our help. We're meeting with him to help him strategize and make sure that he has everything in place he needs to go up that road to the growth. So what's the big takeaway here? It's really simple to invest in good accounting practices early on, and it's crucial to your business. Don't wait until it's too late, until you're overburdened with the task and things are out of control. By keeping those records in order, you can focus on what you do best. Grow the business. That will take you much further along than trying to be the amateur bookkeeper in place for your business. As you know, you might even find some unexpected savings along the way. By doing it right the first time, remember that a little attention to your accounting can reap big rewards for you. Happy bookkeeping and here's to your success.
