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Many entrepreneurs use Excel spreadsheets to track and record their finances. Due to the extensive features of Excel spreadsheet, it becomes more manageable to account your funds. Many accounting services providing firms also use this application, making it a default for accounting. However, even the best of the things can end with errors unless you know how to use Excel spreadsheets well. We have listed down a few Excel spreadsheet mistakes you should avoid while accounting.
1) Formatting Errors
Do you know the small window that pops up on your screen after you click Save As, which says ‘Too many different cell formats’ that leaves you no option of keeping your work? Yes, it can give you a panic attack. Besides not being able to save your work, Excel can itself change the formatting of your cells and create confusion. When the Excel spreadsheet software is unable to recognize the format, it pops up a small window saying ‘Excel found unreadable content in the file’.
Additionally, do not try to copy-paste data as doing so increases the size of the file. Even though you have the copied data on your clipboard, sometimes the software will pop up another window that says ‘Microsoft Excel can’t paste data’. To avoid all the pop-up windows from interfering your accounting, try to keep your formatting options to a minimum. It is better to limit your formatting rather than lose all of your accounting work.
2) Data Entry Errors
Using incorrect characters or missing a few ones is a human error. False characters is an error for which you cannot sue someone because it could have happened by you. You probably used a minus instead of plus or decimal points in the wrong places. It does not seem like a big deal, but you could end up losing a significant amount of money. In 1995, Fidelity’s Magellan fund had a loss of $1.3 billion, because instead of using a minus, their accountant had used a plus. The whole scene created confusion and doubled the entire money that made them wonder how there was an unknown gain. There is no real solution here except for hardcore reviewing, but you could leave the job in the hands of accounting services.
These errors are similar to character errors, except the numbering becomes a mistake. About ninety percent of accounting is all about numbers, and if you mess up the numbers, you indirectly mess up ninety percent of accounting. Many businesses have ended up in losses due to this kind of error. For the most part, you can review carefully or hire accounting services.
3) Incorrect Formula Range
You input your IFs, Index+Match and Structured References after writing a long and complex formula, but then Excel ends up denying it and shows different errors. Formula errors are #value, ####, #n/a, #name, and #ref. Yes, Excel does love the hashtag trend but you must be tired of it by now. There are a few ways to fix formula errors and get rid of these #errors. An incorrect formula range can sometimes not even show due to whatsoever technical reasons, and this again requires careful reviewing. There was a time when two Harvard professors made this error of inputting a wrong formula range. The hilarious part of the story is that their student working on the assignment thought they made a mistake because two well-known Harvard professors could never make such an error. The example is given only to assure you that anybody is capable of making such mistakes, but you can try to avoid these by knowing before-hand.
4) Lack of Review and Skills
Studies reveal that even when you review your spreadsheet yourself, there is a high possibility that your spreadsheet contains a large magnitude of errors. Take this sentence and remember it every time you complete accounting work, and so that you can review carefully. Allow other people involved to review your spreadsheet. A third party will be more likely to point out mistakes quickly. Besides, not all errors are distinct, and there is no certainty to what extent each error can affect your accounting.
Usually, in your company when you have training taking place for recruits, you overlook the need for spreadsheet training. Not just you, but everyone assumes that Excel is a software that any person would be able to figure it out themselves and get the hang of eventually. You must educate them on the methods and techniques required to operate Excel spreadsheets. With this, you can avoid not only your errors but also possible errors from your employees working on the task. Although, once you appoint any accounting services having the right knowledge, there will be one less thing to worry about in your daily schedule. Besides, there are other ways in which accounting services can benefit your business.
5) Lack of Professional Help
Accounting is a full-time job, and unless you have mastered in accountancy you should avoid trying it yourself. Reading up articles on the internet might not be enough to account the finances of your business. Accountants have ample knowledge, the required software skills, and the skills to fix potential errors as well. Therefore, if you are new to the world of business accounting, consider hiring accounting services rather than experimenting on your own and facing losses.
Now that you know the possible mistakes to avoid, you can keep this in mind and track your accounts without worries using Excel spreadsheets. Moreover, you can always contact reputed accounting services to help you with your finances.
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Running a business is a huge task, especially when it comes to keeping in check the expenses, wages, income, and other money-related items. It becomes exceedingly difficult if the monthly budget has gone overboard and you get drowned by the thought of how to manage other things when this happens. Quite a lot of times, such a situation is unlikely, because you create a cutting-edge plan. Hence, plan in such a way that you have some dollars left even if you go overboard. Here are a few things suggested by most small business accountants that you can try to cut down on expenses and save money.
Spending on Supplies
Your partial monthly expenditure goes into buying supplies for your office, but that does not necessarily have to be the case. Wholesale shops are set up for a reason - for you to purchase supplies in bulk at a reasonable price. Instead of buying stationery only when needed, it is better to buy supplies for at least two-three months all at once. This way you can bargain a lot and buy in bulk at an attractive price. Besides, you will not have to keep commuting repeatedly as well. Keep in mind to buy things in bulk that have a higher expiry duration and buy food in bulk for a month that is the minimum expiration for usual canned foods.
For other resources like furniture and equipment, you can buy those that are second-hand. You do not need to have everything new. All you need to have is tidy furniture and functioning equipment. Thrift stores and second-hand shops are places that should always be your first preferences.
Cut Down the Production Cost
When it comes to production supplies, keep track of every last material. Usually, companies overlook this due to the workload, but in case the suppliers try to increase even 1% in the bill, it later adds up to a lot in your office budget. Renegotiate with suppliers over the expenditure on supplies every month as it is not very time-consuming.
Even though the required software is a one-time investment, but you should still consider opting for free downloads and trial versions. You can access free software from a website called Download, or you could install trial versions if you want them for a limited time. Student versions are also quite cheap than the usual ones.
Master in Marketing
Marketing is one of the most costly investments a company has to make. Marketing is not that difficult and you can do it yourself in case you have more time than money to spend. All you need to do is learn the basics that you can conveniently look up on the internet. A lot of marketers have their websites, podcast lists, webinar channels, and other information resources.
You may have heard about powerstrips - the rectangular box-like structures that have multiple sockets in them that help in distributing power equally to all the outputs. However, a smart power strip does not just distribute equal power but also conserve around 50% of energy. It immediately shuts off the power distribution to the plugs that are on stand-by mode. A smart powerstrip helps a lot when you have multiple desktops working all day in a workspace.
You must have subscriptions that you no longer need, and they add up to a considerable chunk of money when not cancelled. You can easily cancel subscriptions with a few emails rather than paying for something that is not benefiting you. Just cancel those recurring services like newspapers or monthly periodicals.
Post Jobs Locally or on Social Media
You will learn to do this via marketing, but it is better than spending money on job posting sites as they are expensive. Hence, market all the vacancies you have and promote posts on your Instagram or Facebook pages. Post social media job updates and you could even provide employees with a weekly chance to post updates for social media marketing, and in return, they get to learn something new. You can also send your job listings to local university career portals.
Natural Light Location
Natural light has two benefits. Firstly, you reduce your electricity cost, which saves up a lot of money. Secondly, natural light is more recommended for workspaces as they increase the productivity of your employees. Working on computers the entire day can be draining, and every person can have a lifted spirit by getting a little sunshine and an outdoor essence. So open the curtains and blinds and let some natural light in.
Online Over Offline
Try to limit the use of paper. Not only is this eco-friendly but it will also save you money. Use Google apps or other business platforms like Slack. You can instead have documents backed up online in the cloud, making it less likely to be misplaced.
In case you have a meeting outstation, keep your first preference to have the meeting via video call or Skype. Travelling can be extremely time and money consuming, instead save both by going online and you can spend the two factors on other projects. You can talk to your small business accountant to know more of such "go digital" tips.
Not only do all these tips help you save money, but benefit in several other ways. You learn new skills through marketing and increase productivity in your workspace, which is essential for an office. Moreover, once you start saving from your office budget, you will slowly practice this in your personal finances as well. There are more methods in which you can save this money and can consult small business accountants as well. It helps in keeping personal taxes on track. These work great for small businesses as they have more experience in this field. Now that you have learned how to save money, where will you spend this money? Probably in your next monthly budget? You could instead invest the money, something that your small business accountant will generally suggest you do.