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Danger: This budgeting mistake could cost your company BIG money

by , 16 September 2014
The most important part of managing your company is managing your finances. After all, if you don't come out with a profit at the end of the month, your business will struggle to grow.

To help you avoid this problem you need to budget your finances effectively.

But sometimes that's not that easy.

Business owners often make mistakes with their budgets that land them in serious trouble.

In fact, if you make this one mistake it could cost you money...


Here's how a budget helps you manage your money

A budget works effectively when you can account for all your income and expenses correctly. This way you can see exactly where money goes and what you have left. 
To do this, you need to record the exact figures for your business and remember to deal with your fixed and variable amounts separately.
That sounds easy right? 
Well it is, but all too often business owners make the process a bit too simple. That's when they make this mistake.
If you do the same, it's costing you money and you don't even know it.
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Here's the budgeting mistake that's costing you money

You may think nothing has changed for this month so you simply copy over last month's budget. 
You see, because of your variable income and expenses your figures could be different this month. Even if they're out by a few rands, those are rands you didn't account for. This could cost your company a lot if those small unaccounted for amounts of money add up in to thousands of rands.
Because of that you can't track where that money actually ends up and that could cost you more money in the end.
You have to be accurate with your budget for it to be effective. So create a new budget each month, no matter how similar it is to last month's, to avoid making this budgeting mistake.

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