Why It’s Important for Your Business to Maintain Accounts
The importance of maintaining accounts should not be underestimated as they integral in preparing management reports. Ensuring that your accounts are 100% accurate and always up to date is beneficial for a number of reasons.
Following business formation in Dubai, we advise our clients to maintain accounts of all the transactions, records, and details that can give them a true picture of their business performance. Here are some of the reasons why it’s important to maintain accounts for your business.
1. Make Better Business Decisions
When all the transactions are recorded, you have a better picture of where your business is heading. Receipts, invoices, purchasing orders, and other records of money coming in and going out provide reliable information of how your business has performed. Remember that if your records are inaccurate and not tracked, making good business decisions becomes impossible.
2. Manage Clients and Suppliers Better
Estimates, quotations, purchase orders, and invoices are all important for a reason. Using the historical data, you can be in a better position to send an estimate that gives your business the competitive edge. This also enables you to get better discounts from regular suppliers based on the records of the purchase volume and payment history. SImilarly, when you have all the records organised regarding sales, it is easier to understand the purchasing behavior of your customers to market your products and services more effectively.
3. All the Important Information At Your Fingertips
It’s difficult to resolve conflicting invoices or other financial records when you are not keeping a track of them. In the similar vein, finding the right document can take a lot of precious time, especially when you are dealing with suppliers and customers. Maintaining accounts means you are organizing your transactions neatly, which allows you to quickly find the required documents. On the other hand, your business can bear legal consequences if it fails to maintain proper records of payments and other financial transactions.
4. Easily Generate Reports
You can’t know where you are making money or losing it if you don’t maintain accounts and generating and reviewing management reports on a monthly basis. That is why maintaining accounts is crucial for sustainability and growth. With well-maintained accounts, you can compare the current performance of your business with the annual budget and make better decisions moving forward.
5. Makes It Easy to Get Financing
Yes, that is true. If you are taking out a loan for your business, the lending institution would be able to approve it fairly quickly if all your accounts are well-maintained. On the other hand, banks can choose to reject your loans if there are lots of errors and discrepancies within your accounts. So if you are planning to grow and want to borrow money for your business, account maintenance will definitely help.
6. Maintain Regulatory Compliance
Keeping track of your accounts is actually a legal requirement in the UAE. If there are irregularities in your accounts, then you can be held liable and your business may be penalized. Maintaining accounts allows you to ensure that your operations are within the framework of the law and you are ensuring regulatory compliance.
If you are having a hard time managing your accounts, then there is no reason to ignore them. Let My Business Consulting DMCC help you in accounts and bookkeeping as our expert staff ensures all records are maintained with accuracy and efficiency. Call us today on +971 55 147 9576 to book a free initial consultation, or email us at [email protected] to learn more!