Mexico is a country of MSMEs. This is stated by the latest economic census of INEGI where it is mentioned that this sector represents 99.8% of all establishments. Unfortunately, these indices do not reflect the importance that companies give to good accounting management, since in the latest National Survey on Productivity and Competitiveness of Micro, Small and Medium Enterprises (ENAPROCE), we discovered that:

• 21.4% of MSMEs do not keep any type of record of their finances.

• 25.5% do their basic accounting by hand in a notebook.
• Only 50% take advantage of SHCP tools, or request the service of an accountant.

Sometimes being a todologist is not the best option…

A recurring trend is that young entrepreneurs become the protagonists of all areas of their company, however, as the business grows, this can be counterproductive. According to data from CONDUSEF, 43% of companies fail due to administrative problems, since only 2 out of 10 entrepreneurs are sufficiently qualified to run their own business.

“As an entrepreneur, it is a serious mistake to leave loose ends in the search for best practices to ensure the success of your company, and keeping good accounting is a fundamental part of it,” said Marco García, spokesman for Enconta, a comprehensive accounting solution specialized in MSMEs.

1. “It’s something I can do on my own”

Without a doubt, having accounting knowledge is important to ensure financial growth. However, if you plan to commit to your company’s basic accounting, it’s best to question how familiar you are with its application. You already know that from saying to deed there is a long way, and if you are looking to learn by trial and error, this area of your business may not be the most appropriate to do so.

2. “My family member or friend can do it”

If your acquaintance is an excellent accountant and you have no problem revealing sensitive information to a person with whom you maintain an emotional relationship, then you might consider it. However, even if there is a good bond and communication between you, the willingness to do the job must prevail. Find out if the person has enough time and skills, as well as the ability to act when a crisis occurs. Finally, it provides that if they are working as a favor they have no work obligation to you, and in case of any hurry they can look bad for you, but you can not look bad to the SAT.

3. “Basic accounting is just writing down what I earn and what I spend”

Although strict recording of income and expenses is a fundamental part of financial control, it is not the only responsibility. Keeping information accurate and objective, making reports, fulfilling your obligations to the SAT, issuing invoices correctly, among many others, are common functions in the work of an accountant. In addition, there are already new digital platforms that you can take advantage of to streamline and simplify your processes, retiring once and for all to the accounting book.

4. “Accounting is only necessary at tax time”

Although complying with tax obligations is a priority, it is not the only objective of your reports. Keeping your information updated will allow you to make more appropriate decisions based on the financial status of the company and detect possible capital flights. Investing, looking for investors, obtaining new assets or even ceasing activities altogether are decisions that require a deep knowledge of your numbers.

5. “Accounting is an expense that does not offer me benefits”

Investing in accounting probably isn’t in your plans at first. However, the sooner you get involved with your finances, the better results you will have. Did you know that most SMEs do not keep an accounting record? Not having a history or control of income and expenses can limit your options when applying for credit that can be vital for your business to grow.

Don’t let misinformation affect your business. Currently you can find a wide variety of products that adapt to the accounting needs of your company. Undoubtedly, a good option is digital platforms, since they combine the ease of consultation, information management and security of your data, with the help of a team of experts who will advise you and carry out the procedures for you so that you can focus totally on the operation of your business.