Being a well-known accounting firm in the UAE for more than ten years has taught us at KGRN Accounting Associates that most business owners are unaware of the effects poor account recordkeeping may have on the health of their organisation. For many, keeping track of their accounts is as simple as noting down figures. They are ignorant of the fact that a solid comprehension of statistics and the maintenance of strong numbers can help you outperform your rivals and lower your risk of failure.
Here are a few reasons that will help you understand the need for good recordkeeping:
You can’t handle it if you don’t comprehend it. Accounts that have been adequately kept are structured and recorded properly. This makes it so that anyone who looks at them can understand what they mean and what you need to do to better your business or keep it in its current position. Your ability to manage losses, profits, liabilities, expenses, and receivables will suffer if you are unable to comprehend your account records.
Poor records equals to poor profits
If you keep good records for your company, you will be able to plan your next move to accelerate your success. You’ll be able to make more money as a result. Records that aren’t kept up to date might cost the business a lot of money. It may lead to incorrect predictions that lower your company’s earnings or increase losses.
Inadequate recordkeeping can end a business
If information is missing or incorrectly recorded, it can seriously affect your calculations for your current operations or next project. This could mean over estimations and unnecessary blockage of funds, or limited resources to keep things going. All it takes is one mistake to end your career.
Good recordkeeping saves money
When your business is audited by the government, they will scrutinize every detail. With proper accounting records, you can ensure all your debts, bills and taxes are paid and you are in the clear.
Good recordkeeping will see that all legal requirements are met and that your business activities stay within the law. This prevents you from having to pay heavy penalties and additional taxes.
Good recordkeeping can detect as well as prevent fraud
With the assistance of knowledgeable accountants, you can maintain your accounts efficiently and retrace every entry made. So in the event of accounting discrepancies you will be able to identify the source and the person engaging in fraudulent activities.
Make better decision
Good records are like factual information you can rely on. If you base your business decisions and plans on good accounting records, you can be sure to see desired results. It will also enable to react quickly and make well informed decisions.
Avoid overpaying
With good accounting records, you are less likely to overpay your taxes. It will ensure you pay the right taxes at the right time so that you avoid paying extra. Good records can also reduce your accountant’s fees because he has less to sort out.
It takes just one wrong move, one incorrect calculation to make a business crumble. Are you willing to take that risk with improper recordkeeping? For accounting assistance from Dubai’s finest, call KGRN Accounting Associates today.
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