10 Undeniable Reasons People Hate Law Practice Bookkeeping
September 26, 2016
- It is dry and repetitive. Every single month, you reconcile the bank statements, enter in the same transactions into your bookkeeping software, pay the same bills, and bill the same clients. Yes, the transactions may change or every once in a while you may find someone who didn’t charge you correctly and you get to do something exciting like call the vendor and get them to fix the charge. Overall, it seems mindless and quite boring. Wouldn’t you rather be doing something more interesting?
- Bookkeeping concepts seem counter intuitive. Did you know that you debit your cash in order to increase it in your bookkeeping software? That doesn’t make any sense. Why are you debiting cash to increase it? Maybe you can get your head wrapped around the fact that double-entry bookkeeping is backwards from what you normally think, but then you find out that, in order to increase revenue, you credit it. Why do you debit cash but credit revenue to increase it? This is so confusing.
- Bookkeeping is intimidating. What if you enter something wrong and that means you misfile your taxes? You have your accountant look over your bookkeeping and file your taxes, but they make you sign a piece of paper that says they are not liable if the IRS comes knocking. They can only file taxes based on the information you provide. This means it is your fault if something isn’t entered right, and that can cost you a lot of money.
- Most people hate math. Many people struggle with math in school. They grow up thinking they aren’t good at it and hate it, mostly because they weren’t taught properly. This then makes people think they can’t do bookkeeping or that they will hate bookkeeping because they assume it is all math. No one wants to do things they hate.
- It takes FOREVER when you don’t know what you are Someone once told me it took them four hours to reconcile their one bank account every month. They didn’t have more than 100 transactions to reconcile, but it took them a very long time to do it. If you have the proper systems in place, reconciling an account this size can take less than 30 minutes. So the untrained person, wasting their time, cannot see the value in doing it, especially when they can look at their bank account and know that they have money in the bank.
- Along with bookkeeping comes filing of paperwork. In order to do bookkeeping, you need receipts, invoices, bank statements, and other paperwork. What the heck do you do with all that paperwork once you are done with it? Someone has to file it. You get all done with your books for the month and you are feeling great, and now you have more work to do.
- You would rather be practicing law. Hello! That is what you went to school for. To be an amazing lawyer. Not only is that what you are good at and enjoy doing with your time, but it is also what brings in the dollars. You cannot have a law practice if you are not actually billing clients. Bookkeeping detracts from the limited time you have available to bring in clients.
- The bookkeeping software is confusing. You basically have to use QuickBooks. That is what your peers all use and your accountant says you should use, so you decide to buy it. After about two hours of trying to figure out how to invoice a client through it, you want to pull your hair out. Most bookkeeping software is made for people who understand accounting, and if you don’t have any experience in accounting, it can be very frustrating.
- You are always losing receipts. In order to enter your transactions into you bookkeeping software, you need your receipts (you also need them for tax purposes). But you left that receipt for the office supply store in your pocket and took it home. Two weeks later, you are reconciling your bank statement and see a charge for the office supply store but can’t remember what you bought. Was it actual office supplies for your law practice? Was it something that should be a client expense? Losing receipts can make bookkeeping a huge pain.
- You haven’t seen it as a tool to help you make better business decisions. Because you don’t have time and knowledge, are intimidated by bookkeeping, hate bookkeeping, and would rather be doing something else, you haven’t looked to see all the wonderful things bookkeeping can show you. You have no idea that there are other reports beyond just the profits and losses and balance sheets.
I am sure you can relate to one or more of these reasons as to why you hate bookkeeping. Either you don’t want to do it, you can’t figure it out, you are bored by it, or you simply find it a waste of time. However, you know that it needs to be done. At a minimum, bookkeeping needs to be done properly so you can file your taxes, but it would preferably be a tool that can help you grow your law practice. If you are doing your own books or ignoring them, let me help you. I want to show you how you can use the books to see ways to grow your business. Click here to schedule a free 30-minute consultation.