Running a small business is no small feat. Between managing operations, marketing your services, and keeping customers happy, it’s easy to let bookkeeping fall to the bottom of your to-do list. But ignoring your books can cost you — in time, money, and potential legal trouble.
At Your Bookkeeper On Call, we work with entrepreneurs and small business owners every day to help them stay on track with their finances. Whether you’re tackling your books DIY-style or using our live, on-demand bookkeeping services, here are the top 10 bookkeeping mistakes we see — and how you can avoid them.
1. Mixing Personal and Business Finances
The Mistake: Using one bank account or credit card for both personal and business expenses.
Why It Hurts: It makes bookkeeping messy, complicates tax prep, and can put your legal protections at risk (especially for LLCs or corporations).
How to Avoid It: Open separate business checking and credit accounts. Pay yourself from the business, and keep all personal expenses separate.
2. Falling Behind on Bookkeeping
The Mistake: Waiting until the end of the month—or worse, the year—to record transactions.
Why It Hurts: You’ll miss deductions, make errors, and have zero visibility into your cash flow.
How to Avoid It: Schedule weekly time to update your books or get help from a bookkeeping pro. Our on-demand services make it easy to stay current without the hassle.
3. Not Reconciling Accounts
The Mistake: Skipping monthly bank and credit card reconciliations.
Why It Hurts: You won’t catch duplicate charges, missed deposits, or fraud. Your financial reports may be way off.
How to Avoid It: Reconcile every account monthly. Use software like QuickBooks or Xero—or let us do it for you in real time.
4. Misclassifying Expenses
The Mistake: Logging expenses under the wrong category (like recording office supplies as equipment).
Why It Hurts: It distorts your financial reports and could raise red flags during a tax audit.
How to Avoid It: Learn the basics of expense categories or consult with a professional. We also offer DIY coaching if you’re handling your books yourself and want expert guidance.
5. Ignoring Accounts Receivable
The Mistake: Not following up on unpaid invoices or failing to track who owes you money.
Why It Hurts: You lose cash flow and might never collect what you’re owed.
How to Avoid It: Use invoicing software with built-in reminders and stay on top of aging reports. If it’s overwhelming, we can help automate it.
6. Forgetting to Save Receipts
The Mistake: Tossing or forgetting receipts, especially for small purchases.
Why It Hurts: You lose documentation for tax deductions or audits — and some expenses may become ineligible.
How to Avoid It: Go digital. Snap photos of receipts and store them in your accounting software or cloud storage.
7. Not Budgeting for Taxes
The Mistake: Spending all your profits without setting aside money for taxes.
Why It Hurts: Come tax time, you’re scrambling—or worse, can’t pay what you owe.
How to Avoid It: Estimate your quarterly taxes and set aside a portion of every payment you receive. Or let us help calculate and plan it with you.
8. DIYing Without Enough Knowledge
The Mistake: Trying to handle complex bookkeeping on your own without understanding it fully.
Why It Hurts: Mistakes can lead to inaccurate financials, missed deductions, and costly errors.
How to Avoid It: Know your limits. Our DIY coaching can teach you the essentials, or you can delegate to our pros as needed.
9. Not Using Accounting Software
The Mistake: Relying on spreadsheets or paper records.
Why It Hurts: Manual systems are error-prone, time-consuming, and don’t scale as your business grows.
How to Avoid It: Invest in user-friendly accounting software like QuickBooks Online or Xero. Need help getting set up? We can walk you through it.
10. Not Reviewing Financial Reports
The Mistake: Only looking at your bank balance instead of your full financial picture.
Why It Hurts: You’re flying blind—missing insights that could help you grow, cut costs, or identify problems early.
How to Avoid It: Regularly review your Profit & Loss, Balance Sheet, and Cash Flow reports. If you’re not sure how to read them, our team can help you make sense of it all.
Final Thoughts
Bookkeeping may not be the flashiest part of running a business, but it’s one of the most crucial. Avoiding these common mistakes will save you time, reduce stress, and give you the financial clarity you need to grow confidently.
Need help staying on top of your books? At Your Bookkeeper On Call, we offer:
✅ Live, on-demand bookkeeping support
✅ DIY coaching for entrepreneurs who want to learn
✅ Quick setup, catch-up, and cleanup services
Let’s take bookkeeping off your plate — or help you master it for yourself. Contact us today to get started!
