Over the years we have reviewed hundreds of QuickBooks files and financial statements and other forms of accounting records for clients. All too often these files and statements are full of errors that create a fictitious financial position for the company due to multiple duplication of unnecessary information – information that can prove to be disadvantageous and expensive.
What we have found is that if garbage goes into your financial software or records, that garbage will flow out onto the Balance Sheet, Income, and Cash Flow Statements. This makes it difficult to identify how your company is really doing.
If you want your business to be successful, take time to understand what information needs to be recorded, how to enter it, and how to read and understand the essential financial information that is generated from those transactions. Ask questions, participate in educational training classes, and learn from your accountant. Your financial understanding will increase, your time spent in “cleaning up” your books will decrease, and you will be able to look at a report and know just how healthy or unhealthy your company is.
Remember “Garbage in Garbage out” will not make you a happy business owner.