3 Most Painful Accounting Problems That Are Draining Your Company Dry
Constant stress and pressure revolving around running a company should be no mystery to you. Let’s face it—dealing with tremendous amount of paperwork, and trying to get a grip on inconsistent manual processes in tax and accounting may be overwhelming… to say the least. There is not a single data company in the world that doesn’t care about reducing costs. In fact, it’s the number one item every worker hears from their bosses—no matter how high or low they sit on the corporate ladder.
So, the big challenge is to somehow do much more with less… and do it better.
Sounds easy, right? Take a look at the statistics to get a full picture of the problem we’re dealing with.
3 most painful accounting problems that are draining your company dry
1. Manual errors
Manual accounting systems relying on human accuracy are naturally prone to errors. Even the most qualified staff won’t save you from accounting blunders—and they will happen, sooner or later. Punctuation, spelling, grammar, misinterpretation of data, not saving work or mistyping in the wrong fields are all common in most data field entries.
- Input errors are by far the most widespread problem, contributing to 27.5% of all manual problems in accounting. Data may come from a huge variety of sources: paper documents, e-mails, web-based forms, etc. Each one of them needs to be integrated into one, core format. Not only does it add additional processing time, but also increases the chance that mistakes will be made: paying incorrect amounts, or duplicating invoices, which all may result in late-payment penalties.
2. Regulatory missteps
Although not as common, regulatory errors are much harder to spot than manual ones. Rule-based mistakes may be much more costly, particularly if a certain behavior is being unnoticed for months….. or even years.
- Misinterpretation or lack of data is a crucial problem often seen in data entry. Clerks might interpret various data strings differently and impressions may not often be accurate. As it turns out, this type of error might lead to disastrous consequences.
3. Time consumption
When it comes to data entries, no matter how fast you type, think, or process information, speed will always cause problems. Accounting functions based on manual work involve paper journals, ledgers or similar tools that require copious time to complete specific tasks.
The bottom line is
Your staff will EVENTUALLY make a mistake due to lack of focus: we’re all humans after all.
Audits that take centuries to finish — It’s no secret that audits are the real bane of every organization’s existence. Digging through hundreds of file drawers to find the right piece of information and pull it all together for auditors in time sounds all too familiar, doesn’t it?
Imagine if all this could be accessed from a centralized location and all steps within an accounting workflow could be tracked.
Paper invoices requiring too many hours — Invoices require cross-reference checks to ensure their accuracy. It means accountants have to manually compare them to a PO (purchase order) or a contract. Some of them require several levels or approval (like sending them from desk to desk for weeks to no end…).
Conclusion
Tax and accounting mistakes may be deadly and costly. Read our next article to find out specifically, how A.I can help you with battling all of the outlying (and hidden) problems and learn how people at DLabs deal with specific, accounting problems.
FAQs
- How can I reduce the stress and pressure of running a company?
- What are the most common accounting problems that are draining my company dry?
- How can A.I help me with battling accounting mistakes?
- What are the most important steps to take to ensure accurate data entry and avoid manual errors?
- How can I streamline my accounting processes and reduce the time consumption?
Read our next article: How mistakes in tax and accounting are slowly killing your business from the inside: the need for…
