Micro businesses spend 10 weeks a year trying to sort out their finances and accounting compliance is one of the most stressful tasks

The most time-consuming finance task is accounting, which takes the smallest businesses 1.7 hours a week, equating to more than one week a year spent solely on keeping the books.

The average micro business works 79 hours per week, of which 15 are spent on financial administration – equivalent to 19%, according to research.

Accounting was viewed as the most stressful part of running a business and was more likely than any other task to eat into downtime, with a third (32%) of micro owners stating this was the case.

Tax compliance is another area where micros are concerned that they will trip up over complex laws and face Revenue penalties, while changes to VAT reporting have also had an impact. 

When asked what could save time in the finance department, one in five (19%) said that being able to see and access all of their finances in one place could be the answer, while one in six (16%) recognised the benefit of having an accounting system integrated with their bank account. 

The research also found that the smallest firms are disproportionately impacted by this kind of work, with sole traders spending almost a third (31%) of their labour time on financial admin work, and companies with 1-4 employees devoting a quarter (25%) of their time to this area.

One business owner commented: ‘I didn’t get into business to do finance-related admin, but without it, you are doomed. I’m still learning. I’ve purposely put myself through some training, but I can still say that this is the worst part of running a business.’ The survey included sole traders and companies with one to nine employees.