Page 191 - Budgeting for Managers

Use a Payroll Service and
Never Miss a Payment
It’s important to use a payroll service to avoid mistakes
and problems that can lead to excessive interest, penalties, and time-
174 Budgeting for Managers
consuming bureaucratic hassles. It’s even more important to always
make payroll taxes on time—usually the same day you cut paychecks.
When money is tight, it may seem tempting to pay your employees on
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time and pay the government their payroll tax deposit (for withhold-
ing) a bit later. However, this is a federal offense that has a good
chance of landing you in jail.

General Financial Management
The time you spend managing money is time you don’t spend
making money. Every company, no matter how small, needs
work done for billing, accounts receivable, accounts payable,
and general bookkeeping. Most need timesheets as well. It may
add up to only a few hours a week, but it’s crucial that you not
fall behind. Being up to date in bookkeeping and financial man-
agement has these advantages:
•You reduce the cost of late fees, penalties, and interest.
•You see problems coming, because you catch them
sooner.
•You get a better feel for your business because you know
how the money is coming in, where it is going out, and
how much you have.
•Your records are more accurate, because they’re not
based on inaccurate memories of what might have hap-
pened.
•Being on top of the business and having clear records
makes planning and forecasting much easier.

The problem is finding enough time to keep up to date on
the bookkeeping. Each small business owner needs to decide
whether to do it himself or herself or to hire a bookkeeper or use
a bookkeeping service. Whichever you do, I recommend that
you know enough to be able to do it yourself. That way, you can

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