If you are in charge of running a business and you have noticed that company funds seem to be disappearing more quickly than expected, then you're probably attempting to determine the cause. There are many reasons why your company may be losing money, and here are some areas to search when trying to find a cause, so you can reverse the problem.

Possible payroll errors

Whether you use an outside payroll service or you handle payroll in-house, you are likely aware that errors sometimes occur. There are several mistakes that accountants tend to make that could cost your company a great deal of money. Some common payroll errors that could be costing your company money are

• Overpaying employees: Not all employees will report over-payment errors. This is why it is imperative that whoever handles your payroll double checks every paycheck for every employee. 
• Submitting deposits late: If deposits aren't submitted on time, then your financial institution may charge overdraft fees if funds aren't available to cover checks, regardless if they are payroll checks or payments for bills.
• Failing to send out 1099 forms: If your company employs contractors at any time during the year, then it is required that a 1099 form be sent to each contractor that earns $600 or more. Failing to do so could result in your company being assessed a penalty, which could add up if it is a regular occurrence. 

Thankfully there are ways of minimizing payroll mistakes. One way is to make it mandatory that your accountants remain up-to-date with training. With tax laws rapidly changing, it can be easy for even the best accountant to make an error if he or she isn't aware of a change in the law. Another way to minimize payroll errors is to perform regular payroll audits. This can hopefully identify any errors before they have the chance to cause any harm.

Ineffective marketing

If you don't have a sound marketing plan, then your company could be missing out on a great deal of prospective business. An effective marketing strategy can bring in numerous customers, which would prevent it from appearing as if funds are disappearing. If you suspect that inadequate marketing is the reason your company is losing money, then you should consult with a marketing expert. He or she can help you to create an effective marketing strategy that has the potential to completely reverse the problems with your finances.

There is no reason to allow your company to continue to lose money. By taking the steps necessary to determine where the money is going, you can reverse the cause easier than you may have believed was possible. You can then begin bringing in maximum revenue, just as you may have planned. For assistance, talk to a professional accountant like Waggoner Frutiger & Daub CPA's.

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