{"id":2638,"date":"2021-11-12T12:10:30","date_gmt":"2021-11-12T12:10:30","guid":{"rendered":"https:\/\/www.vitalstatistics.info\/?p=2638"},"modified":"2021-11-25T12:11:18","modified_gmt":"2021-11-25T12:11:18","slug":"5-accounting-principles-every-small-business-owner-should-know","status":"publish","type":"post","link":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/","title":{"rendered":"5 Accounting Principles Every Small Business Owner Should Know"},"content":{"rendered":"<p>The entity principle in accounting is one of the top concepts business owners must understand. Many starting and small businesses make the mistake of mixing personal and business finances. This mainly happens, so business owners do not have to open another bank account, and other reasons include the simplicity of the recording system. However, aside from this practice being a contravention to the entity principle of accounting, it also causes various issues for the business.<\/p>\n<h2><strong>Limited Audit Trail<\/strong><\/h2>\n<p>Having a good audit trail is important in business to verify and validate financial transactions. But mixing business and personal activities in the company books impairs the audit trail, making it harder to monitor income and expenses. Therefore, if there are discrepancies in the finances, it would be harder to determine where the issue lies. More importantly, internal fraud is much harder to detect with the limitations caused to the audit trail.<\/p>\n<h2><strong>Complicates Taxes<\/strong><\/h2>\n<p>Since mixing finances affects income and expenses, it also eventually influences tax computations. Not only does it complicate the taxation process, but personal activities also add to the company\u2019s tax costs. There are also certain deductions the business might miss, which translates into letting go of tax savings.<\/p>\n<h2><strong>No Clear Picture of Company\u2019s Financial Health<\/strong><\/h2>\n<p>Proper accounting is critical in determining how well or bad the enterprise is doing. But even with <a href=\"https:\/\/kippinitsimple.com\/\">small business accounting software<\/a>, improperly recording personal financial activities lead to inaccurate records and misleading reports. Making business decisions based on these incorrect reports can lead to problems later on.<\/p>\n<h1><strong>Practice Proper Record-keeping With KIPPIN<\/strong><\/h1>\n<p>Along the listed above, there are many more issues that the improper practice of recording owner\u2019s finances with the business may cause. Exercising proper accounting and using the <a href=\"https:\/\/kippinitsimple.com\/accounting\/\">best accounting software for small business<\/a> will solve these problems without much effort.<\/p>\n<p><a href=\"https:\/\/kippinitsimple.com\/\">KIPPIN<\/a> is a small business accounting software that manages the company\u2019s financial reports in simple and convenient ways. It allows entrepreneurs to correctly record business transactions even with minimal knowledge in accounting. As a result, the books and financial statements are accurate and reflect the actual health of the company.<\/p>\n<p><a href=\"https:\/\/kippinitsimple.com\/contact\/\">Contact us<\/a> today to learn more about how to integrate and use KIPPIN accounting software in your business.<\/p>\n<p><a href=\"https:\/\/kippinitsimple.com\/5-accounting-principles-every-small-business-owner-should-know\/\"><img decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png\" alt=\"5 Accounting Principles Every Small Business Owner Should Know\" width=\"100%\" height=\"100%\" border=\"0\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The entity principle in accounting is one of the top concepts business owners must understand. Many starting and small businesses make the mistake of mixing personal and business finances. This mainly happens, so business owners do not have to open another bank account, and other reasons include the simplicity of the recording system. However, aside from this practice being a contravention to the entity principle of accounting, it also causes various issues for the business. Limited Audit Trail Having a good audit trail is important in business to verify and validate financial transactions. But mixing business and personal activities in [&hellip;]<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics\" \/>\n<meta property=\"og:description\" content=\"The entity principle in accounting is one of the top concepts business owners must understand. Many starting and small businesses make the mistake of mixing personal and business finances. This mainly happens, so business owners do not have to open another bank account, and other reasons include the simplicity of the recording system. However, aside from this practice being a contravention to the entity principle of accounting, it also causes various issues for the business. Limited Audit Trail Having a good audit trail is important in business to verify and validate financial transactions. But mixing business and personal activities in [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/\" \/>\n<meta property=\"og:site_name\" content=\"Vital Statistics\" \/>\n<meta property=\"article:published_time\" content=\"2021-11-12T12:10:30+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-11-25T12:11:18+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png\" \/>\n<meta name=\"author\" content=\"Paul Petersen\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Paul Petersen\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/\",\"url\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/\",\"name\":\"5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics\",\"isPartOf\":{\"@id\":\"https:\/\/www.vitalstatistics.info\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png\",\"datePublished\":\"2021-11-12T12:10:30+00:00\",\"dateModified\":\"2021-11-25T12:11:18+00:00\",\"author\":{\"@id\":\"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/793cf884af9c84183cb37b029510969b\"},\"breadcrumb\":{\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage\",\"url\":\"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png\",\"contentUrl\":\"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.vitalstatistics.info\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"5 Accounting Principles Every Small Business Owner Should Know\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.vitalstatistics.info\/#website\",\"url\":\"https:\/\/www.vitalstatistics.info\/\",\"name\":\"Vital Statistics\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.vitalstatistics.info\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/793cf884af9c84183cb37b029510969b\",\"name\":\"Paul Petersen\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/94622c5e45434c7b4c8732bcf24433e8?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/94622c5e45434c7b4c8732bcf24433e8?s=96&d=mm&r=g\",\"caption\":\"Paul Petersen\"},\"url\":\"https:\/\/www.vitalstatistics.info\/author\/paul-petersen\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/","og_locale":"en_US","og_type":"article","og_title":"5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics","og_description":"The entity principle in accounting is one of the top concepts business owners must understand. Many starting and small businesses make the mistake of mixing personal and business finances. This mainly happens, so business owners do not have to open another bank account, and other reasons include the simplicity of the recording system. However, aside from this practice being a contravention to the entity principle of accounting, it also causes various issues for the business. Limited Audit Trail Having a good audit trail is important in business to verify and validate financial transactions. But mixing business and personal activities in [&hellip;]","og_url":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/","og_site_name":"Vital Statistics","article_published_time":"2021-11-12T12:10:30+00:00","article_modified_time":"2021-11-25T12:11:18+00:00","og_image":[{"url":"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png"}],"author":"Paul Petersen","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Paul Petersen","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/","url":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/","name":"5 Accounting Principles Every Small Business Owner Should Know - Vital Statistics","isPartOf":{"@id":"https:\/\/www.vitalstatistics.info\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage"},"image":{"@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage"},"thumbnailUrl":"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png","datePublished":"2021-11-12T12:10:30+00:00","dateModified":"2021-11-25T12:11:18+00:00","author":{"@id":"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/793cf884af9c84183cb37b029510969b"},"breadcrumb":{"@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#primaryimage","url":"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png","contentUrl":"https:\/\/kippinitsimple.com\/wp-content\/uploads\/2021\/10\/5-Accounting-Principles-Every-Small-Business-Owner-Should-Know-01.png"},{"@type":"BreadcrumbList","@id":"https:\/\/www.vitalstatistics.info\/5-accounting-principles-every-small-business-owner-should-know\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.vitalstatistics.info\/"},{"@type":"ListItem","position":2,"name":"5 Accounting Principles Every Small Business Owner Should Know"}]},{"@type":"WebSite","@id":"https:\/\/www.vitalstatistics.info\/#website","url":"https:\/\/www.vitalstatistics.info\/","name":"Vital Statistics","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.vitalstatistics.info\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/793cf884af9c84183cb37b029510969b","name":"Paul Petersen","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.vitalstatistics.info\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/94622c5e45434c7b4c8732bcf24433e8?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/94622c5e45434c7b4c8732bcf24433e8?s=96&d=mm&r=g","caption":"Paul Petersen"},"url":"https:\/\/www.vitalstatistics.info\/author\/paul-petersen\/"}]}},"_links":{"self":[{"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/posts\/2638"}],"collection":[{"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/comments?post=2638"}],"version-history":[{"count":1,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/posts\/2638\/revisions"}],"predecessor-version":[{"id":2647,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/posts\/2638\/revisions\/2647"}],"wp:attachment":[{"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/media?parent=2638"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/categories?post=2638"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vitalstatistics.info\/wp-json\/wp\/v2\/tags?post=2638"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}