ACCOUNTING MISTAKES & BEST PRACTICES

Tom Carlson

• As the March tax season deadline approaches, many businesses and accounting organizations are under a lot of stress

• The problem with all the stress that comes with this time of the year is that a lot of mistakes are made and people’s money falls through the cracks

• Reports estimate about $7 billion was accumulated by U.S. businesses in IRS civil penalties

• These penalties were rooted in incorrect reports relating to income and employment values

• Human error remains a major factor to consider during this important time of the year and it appears to only be growing worse

• The mistakes being made aren't always that complicated either

• In fact its the small errors that may have the largest effects and require more attention to detail

• In this presentation you will find the best ways to combat the accounting mistakes that may cost your company and clients countless dollars

1. MANUALLY INPUTTING INCORRECT DATA INTO AN ENTERPRISE SYSTEM

• Seeing as how there is already an uncountable amount of data entry in every accounting department or company, it shouldn't be too much more effort to help fix the problems currently happening

• It would only take a little more effort to input the incorrect data to help out

• Mistakes happen but doing your part to catch them by reviewing, will help out everyone involved in the process

2. SAVING FILES WITH CORPORATE FINANCIAL OR TAX DATA TO A PERSONAL

DEVICE• Data breaches occur each and everyday to some capacity and with

personal and organizational finances on the table, use of personal devices with company data on them is a huge problem

• Its extremely easy to save items to your phone, laptop, or tablet and take your work home, however this could lead to a data breach costing millions or billions

• Not only would money most likely leave the companies door but it would also damage the firms reputation among the public

3. ACCIDENTALLY DELETING A CUSTOM EXCEL FORMULA

• Excel still plays a major role in many companies, especially in accounting as it keeps track of the numbers and formulas for achieving certain yields

• Many times companies will have custom formulas set up to expedite certain process and make employees jobs more efficient

• Employees need to be conscious that those formulas are there for a reason and should not be tampered with or deleted

• As a side note, companies should probably use accounting or tax based software systems so that employees cannot edit the formulas provided

4. WORKING ON A NON-SECURE PUBLIC WI-FI NETWORK

• This goes back to the security issue I brought up earlier with using personal devices in tandem with company data

• No accounting business should be running their Wi-Fi on a non-secure public network

• It is easy for hackers to gain access to these types of networks and wreak havoc

• Don’t invite potential dangers to your company’s doorstep

• This also goes for doing work around the corner at Starbucks because the data is no safe

• Most companies should have this as a policy of theirs in the contracts employees sign, however it is easily overlooked

5. OVERRIDING DATA IN AN ENTERPRISE SYSTEM WITH FIGURES CALCULATED

OUTSIDE OF THE PROGRAM• Seeing as how there is already an uncountable amount of data entry

in every accounting department or company, it shouldn't be too much more effort to help fix the problems currently happening

• It would only take a little more effort to input the incorrect data to help out

• Mistakes happen but doing your part to catch them by reviewing, will help out everyone involved in the process

6. CLOSING THE BOOKS BEFORE ALL REQUIRED DATA HAS BEEN COLLECTED & MODIFYING

ASSET INFORMATION FROM PAST YEARS

• This mistake can have major implications that affect the organization as a whole

• A big danger that can be associated with this would be errors that are carried over years and not noticed until its too late or not noticed at all

• All data needs to be present before the books are closed to avoid potentially enormous risks

7. INCORRECTLY APPLYING UNITARY STATE TAX RULES & NOT KEEPING TRACK OF OR

ADHERING TO CITY-SPECIFIC TAX REGULATIONS

• Staying alert and attentive to changing laws is also part of the job

• Staying on the ball in this regard will allow your company to move seamlessly and without any problems or penalties coming your way

• It is well known that different states and different cities differ in their tax laws, so companies that are up to date will excel past the ones that make simple mistakes

• Organizations that routinely look for and address problems will avoid major risks and problems for the company as a whole

• Each and every company depends to every employee and rely on them to put their best foot forward even if it means a little more effort

• With stronger procedures in place businesses can further themselves and be more accurate

-Tom Carlson