Successful small businesses keep meticulous financial records. With the economy the way it is, money is tight. And there's always the threat of the IRS knocking on your door. It is important to know just how you are spending your company's financial resources. Yet many organizations or business proprietors fail to get their financial management systems set up properly before they get hit by an audit or a bank requiring financial sheets. Here are some of the most common bookkeeping mistakes that small businesses make:

1. Not having an accounting procedure in place.
   When small businesses get started, there is often not an urgency to have accounting procedures in place. And, as the business grows, it is very easy to forget and/or put off implementing appropriate accounting procedures. Ignoring this fundamental business practice results in failed audits and potentially costly fines by the IRS for any resulting reporting issues.
   
   
2. Open access to financial records.
   Many small businesses forget or perhaps don't realize that they can and should restrict access to critical financial information. In QuickBooks, the most commonly used accounting software; setting up access is relatively straightforward.
   1. At the top, choose "Company" and then choose "Set up Users"
   2. Create a new user and follow the on-screen steps to decide what access that person gets
   
   
   
3. Not customizing the "Chart of Accounts" Many small businesses that are new to QuickBooks or any other accounting software, simply use the standard, pre-set "Chart of Accounts". However, it is far more useful for businesses to create their own Chart of Accounts based on their unique needs. Since it is so important these days to be able to prove to the IRS that your expenses are business related, it is imperative you are tracking your expenses in an effective way.
   
   
4. Not properly reconciling accounts This is a critical step in the financial process and yet many organizations don't do this! Most software packages such as QuickBooks handle bank reconciliations easily. It is crucial to reconcile monthly to catch mistakes, prepare accurate P&Ls and balance sheets, keep track of income and expense, and in rare, unfortunate cases, detect fraud or misappropriations early on. To maximize the benefits of monthly reconciliations and avoid costly cleaning up of bookkeeping files, it is essential you use this feature from the moment you open the account. In Quick Books, you can find the "Reconciliation" feature on the "Home screen".

Given the severe penalties handed down by the IRS for inaccurate accounting, it is important to get your books in order as soon as possible. By avoiding these four common bookkeeping mistakes, you will be on the right track for effective financial management.

Michelle Jetzer, MBA
Solaris Management LLC

www.yourhometownbiz.com/mobile

That's all you need to know to effectively network in the greater Madison area. Now you can check the dates of events while you are on the road or out networking by using your smart phone. Get access to today's networking events or look up event dates into the future.

Check out the details of any listed event AND see who is planning on attending the event as well as let evereyone know that YOU are going to attend. The more exposure a business gets, the better. It's all part of productive and profitable networking!

And best of all, this service is absolutely free! You do not need to be a registered user of yourhomewotnbiz to take advantage of this mobile calendar. (Creating a business profile and posting events does require site registration.)

Improve your networking now! User your smart phone to log in to www.yourhometownbiz.com/mobile. If you host an event, post it yourself on www.yourhometownbiz.com.

And, as always, let us know how we can improve these applications to make them more helpful for you and your business!

Your Hometown Biz is greater Madison's most comprehensive calendar of business networking events.

And besides the calendar, your local business can...

• create a business profile that includes your logo, a photo of yourself, your product or your service and a description of your business that can be as long as you like,
• increase your business exposure through the member directory, random spotlight on the Your Hometown Biz home page, and the ability for you to show yourself in attendance of networking events,
• show other busienss people that you will be attending an event or see who else is planning on attending an event.
• Draw new members to your organization by listing your own meetings in the calendar

Register for Your Hometown Biz (it's free!), check out the resources and let us know of any enhancements that may make your business more efficient and profitable!