Smallest businesses yet to put their books on the PC
Half of businesses with 10 or fewer staff prefer the old methods of paper and pen to computers when keeping their books, according to research from software company Kashflow.
It says that 50% of micro businesses manage their finances manually, yet one third say they feel like they spend too much time doing paperwork. Of those using computers to manage their accounts, just 21% use software specifically designed for the task.
“Owner managers must find a way to manage their accounts and finances more effectively,” said Sotiris Spyrou of Kashflow. “Most regard keeping financial records as something they only do to keep their accountant and the taxman happy. The effective management of accounts and the ability to interpret and act on such business data has proved to be the difference between success and failure for many small businesses.”
Spyrou warned that 100,000 firms and up to 70% of firms in their first year close down due to poor financial management. He said that common complaints from proponents of manual bookkeeping are that computerised accounts management is too complicated, costly and time-consuming.
With the right training, Spyrou said that firms can eventually minimise the amount of time it takes to produce end-of-year results, not to mention reducing accountants' fees.