Using an Accounting System

30 July 2013 / Video Blog / Comments Off on Using an Accounting System

Welcome to another edition of Tuesday Tidbits where we make accounting and tax simple. I'm your host Charles D. Shapero CPA, with Widget Bookkeeping & Tax. Today we're going to talk about why you should be using an accounting system. An accounting system really is used by a business owner to see how your business is performing. Am I on pace with my goals? If you have a goal to reach $100 grand in revenue this year, how do you know if you're reaching it? If you're comparing this year to last year, without an accounting system, that is impossible. With an accounting system in place, like Quickbooks or even Excel for that matter, you can look at this year's performance compare it to last years and say 25%, I'm meeting my goals, that's fantastic. OR, the other conversation, wow, I'm about even with last year, I really wanted to grow 25% I better run out and do some more marketing or I need to hire some staff to take away some of this work so I can focus on billable type events, that's what a business owner should use your accounting system for. What your CPA wants to use your accounting system for is that we have a tax return to prepare at the end of the year. How are we going to prepare that return without numbers that we can trust? Not only that, but the IRS requires that we make 4 payments to them during the year. Your estimated tax payments. Every quarter I call my clients and ask them, what's your profit looking like this quarter? We need to look and see if you're going to be able to make a bigger estimated tax payment, a smaller one or if you just want to make the ones we talked about at the beginning of the year. Without using an accounting system we have no idea we have no idea what your business performance is, and we have no idea if you're paying the IRS more or not as much as you should. So accounting systems are valuable for both the business owner and your CPA. And that my friends concludes this Tuesdays Tidbit, see you next Tuesday. Widget Bookkeeping & Tax Know More, Keep More!

Tags: , , , , , , , , , , , , , ,

Back to top