As a business owner, having control of your books is necessary if you want your business to survive and thrive. After all, navigating the business world requires a good relationship with numbers, making bookkeeping and accounting courses as relevant as ever outside the classroom.
Sadly, there are common traps that startups often fall for, causing them to backtrack and waste resources. We’ve put together a list of the most common accounting myths to help you focus your energy where it’s needed. But if you think this isn’t enough, we suggest considering enrolling in accounting courses.
Top Business Accounting Myths Debunked
The business world is rife with accounting myths emerging entrepreneurs find easy to believe. As such, we are here to help guide you in the right direction.
Myth 1: Accounting is Only for Big Businesses
This myth couldn’t be further from the truth since managing your cash flow from the start is the most crucial step for emerging businesses. If you are meticulous about your money, you should be even more so regarding your business. Like managing a personal budget, the less you have, the more essential it is to maximise what you have so you don’t waste a single dollar.
Learning how to manage the financial aspects of your business from the start is crucial, no matter the size of your business. And learning how to do it from the beginning helps you establish methods that work for you, helping you become more efficient as your business grows.
Myth 2: I Don’t Need to Learn Bookkeeping
Not keeping track of your bookkeeping is a big mistake many startups make. By keeping track of your cash flow, you will know whether you need to cut down on costs or if you can afford to make more significant purchases. Work hard to understand the numbers, and you will better grasp your financial security as a business.
Establishing a good foundation for your business accounts will help you immensely as you grow your business. While this doesn’t mean you need to be a full-fledged bookkeeper, you should learn enough to understand your business numbers. If you’re ready to start learning, try our beginner bookkeeping courses.
Myth 3: Spend More to be Successful
Spending is a necessary investment for businesses in any industry. However, that doesn’t mean that spending more always guarantees a positive return on investment. What matters most is knowing when and where to spend your money and when you shouldn’t.
Don’t allocate your business funds blindly. Renting or buying a pricey, extravagant office space instead of a smaller and simpler one is just one example of a bad spending decision. Make wise choices so you don’t run out of money before you’ve even started.
Learn how to develop a sound business plan or build a cash flow through our online short courses.
Myth 4: Small Businesses Don’t Need Accounting Software
Modern technology has transformed many things, including how one can do accounting for their business. Thanks to this, plenty of providers now offer robust accounting software that is customisable for various business requirements. This means small accounting packages are also available for startup ventures.
While you may be thinking that your small business doesn’t need accounting software just yet, using one can vastly improve your business’ daily recording of day-to-day transactions. Moreover, accounting software provides key insights regarding different areas of your business.
However, it would be best if you still focused on grasping the basics of accounting before attempting to use accounting software so you understand the wealth of knowledge it provides. Apart from teaching the fundamental principles, our accounting and bookkeeping courses in Perth also support individuals and business owners who use accounting software.
Myth 5: Accounting is Only for Tax Purposes
Many small business owners make the mistake of thinking that maintaining books is only done in compliance with taxation liabilities. Although it is essential for the tax season, accounting also provides plenty of other benefits.
Apart from keeping track of your business profits, you can use the information in your accounting books to improve business performance. Identify which parts of your business are excelling and the ones that are not. By doing this, you can tackle areas of improvement and boost areas that are already doing well.
Myth 6: Small Businesses aren’t Monitored by the ATO
No one wants to get audited, and the fact remains that no one can guarantee who will be audited and who won’t be. That includes small businesses. So, the best financial decision to make is always to act as if you’re going to be audited. To prepare for this, make sure that your books are in order.
Many course providers offer accounting and bookkeeping courses to help you learn how to manage your books correctly. So, ensure that your business is secure and start learning today.
Myth 7: I Don’t Need a Budget for My Business
You may think this way because you are good at managing personal money. But your personal and business budgets are different. Budgeting for businesses involves many additional factors that should be considered, which is where good accounting comes into play.
For instance, you need to consider fixed and variable expenses, taxes, one-time events, and fluctuations. By creating a budget for your business, you get a detailed analysis of how your business should allocate funds now and in your future business expansion. It also helps ensure that your capital isn’t wasted on unnecessary expenses.
Understand how budgeting for your business works and find more examples of budgeting processes, tools and techniques in our accounting courses in Australia.
Myth 8: Managing Accounting Records is Very Easy
Most small business owners believe that managing books of accounts is extremely simple and that they don’t need to learn it well. While the principles may be easy to understand and apply, there are accounting laws and regulations that you need to follow. Because of this, it is vital not to make mistakes in your accounting books.
Since it is a crucial skill in business, studying accounting is still essential for business owners. For this reason, many course providers offer accounting courses to help budding entrepreneurs. Once you’re handling your books, remember to apply meticulous attention and patience so that you don’t make mistakes or get in trouble, especially regarding the laws and regulations.
Myth 9: My Business Can’t Save Money
Spending a lot of money is unavoidable at the start of your business since you are making investment decisions. It can make you think that saving money is impossible initially, but that isn’t the case. You can still contribute to your business’s savings account by only spending on things you can genuinely afford.
Using data from your books, you can make wiser spending decisions. Look for affordable alternatives for things your business can’t do without. As you continue to do this, your cash runway will increase, and you will have more options for expansion.
Myth 10: My Accountant Will Handle Everything
You can undoubtedly hire an accountant to take over financial books when your business is growing. But that does not mean you’re out of the picture or can rely on them for every money decision your company makes. The business owner should be responsible for financial decisions regardless of who handles the books.
Also, business owners must look to the future and decide how to manage and grow their ventures. To do this effectively, you will need a good understanding of what the numbers on your accounting books represent. While your accountant can provide advice and direction, you will decide where you want your business to go.
Myth 11: Good Help is Expensive
While it’s true that seeking professional help in the early days can be pretty expensive, that is no longer the case today. With a more competitive market, professionals offer more comprehensive services at more affordable rates. Thanks to this, you can choose to outsource what you need.
Moreover, many course providers offer tools for business success, which is a big help for startups. Consider it as an investment for lifelong skills that you will gain. For instance, you can enrol in bookkeeping and accounting courses to understand how to manage your business books better. Doing so can also help you gain valuable skills that you can use at any stage of your business.
Enrol in Accounting Courses for Beginners
If you want a better grasp of handling your business books, enrol in accounting and bookkeeping courses today at the Australian Institute of Finance Training. To those looking to kickstart their administrative career, we also provide an accounts administrator course to help you get certified.
We are providers of online bookkeeping courses Australia-wide, preparing you for life beyond the classroom. Our courses are updated regularly to reflect the latest accounting and business industry developments.
Get access to trainers with sharp business acumen and financial knowledge and learn from their experiences. You will also learn from industry professionals, business owners, subject matter experts, and veteran trainers with vast skills, experience, and knowledge.
What to Expect
When you enrol, we will provide you with a variety of learning materials
- Learner Guides
- Case Studies
- Simulated Work Environments
- Online Assessments
You will also join an online community that empowers each learner and fuels their drive. Enrol at the Australian Institute of Finance Training for the best online accounting and bookkeeping courses today!