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Managing Business Finances

Business finance is a very crucial term in corporate finance and accounting that encompasses a wide range of disciplines and business activities regarding management of money and other valuable financial assets. It teaches us about effective management and utilization of financial resources, investing strategies, accounting methodologies, and effective debt management. In short, it defines the fate of the business and long-term growth and profitability of any company.

Significance

In order to survive in an extremely competitive environment, businesses need to maintain their financial resources effectively or else pack their bags and go home. In the demanding era we live in, business finances works just like oxygen for survival, stability, strength, consistency, and growth. In short, money keeps your business running and your employees working to attain business goals and objectives.

However, the influx of money needs to be assured at the hour of need or your business may face a financial crisis which may eventually lead to overall business failure. Some of the most common ways in which a business can be financed or money can be raised include business loans, private loans (family or friends), mortgage loans, crowdfunding, etc.

Critical To Business Success

Entrepreneurs or business adventurists around the globe face a lot of difficulties in generating business finances for their unique business ideas. But, even those who manage to generate desired finances often strive to maintain or manage their money—perhaps due to the lack of financial knowledge or management of money related skills. They may have scarce resources but hiring a professional accountant or bookkeeper seems to be a smart choice. This allows them to concentrate on core affairs of the business while their bookkeepers take care of the rest (money related matters). Looking at the sensitivity of the matter, it is indispensable in managing business finances effectively for maintaining a sustainable competitive advantage.

5 Crucial tips to Keep your Business Finances In Order

Get Yourself Ready For the Tough Job Ahead

In order to survive in a volatile economy, you need to come up with new and effective ways to get things right—the very first time. No one is a born genius, it’s your motivation, inspiration and result-oriented approach that encourages you to learn the art of the game before taking on challenges head-on. For managing the finances of a business, you need to educate yourself and get ready for the tough accounting job ahead, as financial recording is no easy feat. The entire fate of a company is dependent on financial recording and analysis—the better they are, the higher the results. This makes it clear that the management and bookkeeping of business finances requires accounting knowledge, skills and, hence, a complete accounting know-how for keeping finances in order and perfectly streamlined.

Keep Your Personal and Private Finances Separate

For developing more command and control over your personal and business finances, you need to deal with them separately in order to avoid confusion. The outflow of cash has to be managed well for keeping a proper track of your business transactions. This will not only help where your money is going but also helps when submitting tax returns at the end of the term. Small businesses often find themselves strangled in sorting between business and private finances as they lack awareness, accounting knowledge, experience, and expertise in dealing with money related issues. By sorting this out, you will have the exact status of your money.

Choose a Suitable Accounting Software

All salutations to superior accounting tools and techniques that have made things a lot easier than traditional and manual ways of recording business transactions. If you haven’t yet moved to cloud technology for maintaining a real-time track of your money and resources, we suggest you do it right away. Today, you have a myriad of options to choose from, however, integrating the right accounting software or technology is crucial.

Hire a Professional Bookkeeper

You may have a basic level of accounting knowledge and experience in keeping transaction records which may not actually be enough for your business. In order to effectively manage each and every thing related to your business finances, you must consider hiring a qualified and reputable bookkeeper. This will not only help you solve financial discrepancies but will also help you save a lot of money in the end.

Make a Budgeting Plan

By creating a budgeting plan, you will get things aligned and more organized than ever. Business budgeting is a necessary evil, which means that no matter how far you run away from it, you still have to create it. This allows you to know the business expenses and see whether they need to be cut if they are exceeding the limit or need to be financed with more money.

Conclusion

It is true that a lot of business owners do not keep records of their business finances or, even if they do, they are most often in a disorganized or cluttered form. In order to establish 100% command and control over your business, you need to manage your finances and cash flow carefully. It is better to hire a qualified bookkeeper for achieving intended outcomes and pave your way to business success.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

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Partnering with outsourced services for the acquisition of the highest quality planning and strategy for a fraction of the cost is pivotal to success. Businesses–small or big–no longer prefer to hire in-house teams to manage certain tasks that can be outsourced to third-party service providers. The reason is obvious, they desire to seek specialized expertise from the gems of the industry. Moreover, start-ups and small businesses usually have scarce resources; time, labor, and money which restricts them to hire in-house accounting and bookkeeping professionals. It’s safe to say that time and cost-effectiveness are the major driving forces behind the motivation to hire business accounting and bookkeeping consultancy services for start-ups in today’s time.

The Evolving Needs of Start-ups and Small Businesses

From small business to a large company, every business establishment needs someone to promptly and effectively manage their financial accounts, pay bills, send out invoices, reconcile bank statements, and manage debtors. Maintaining separate finance departments to tackle financial matters is not only a hassle but also a huge expense. That is why most businesses outsource their financial matters. Looking at the bigger picture, most start-ups lack the wisdom to tackle difficult bookkeeping and accounting-related issues which means they cannot manage to look after their books and finances on their own. For them, hiring the professional expertise of an accountant and bookkeeper is more of a need than a desire.

Business Accounting Consultancy Services for Start-ups

Many success stories are the direct result of hard work, toiling, and commitment along with sincerity that guarantees a secure future.  An experienced and qualified accountant or bookkeeper can serve the right needs of a business with creative wisdom like no other, all the while making better financial decisions.  Beating your competitors with numbers is quite a different story which means you need to employ the right accounting tools and strategies to get ahead of others. Business accounting and bookkeeping consultancy services are the need of the hour as they provide you with valuable insights to help you improve your business’s financial health.

Whether you are starting a new business venture or acquiring an established business, the need for professional accountants and bookkeepers never dies. Many start-ups or established businesses used to feel reluctant to hire professional accounting or bookkeeping services with fear of the integrity of vital data that is highly prioritized by the business would be compromised, for example. Other concerns would be qualification or experience dilemmas that a client is not satisfied with.

What Business Accounting Consultancy Services Do On Your Behalf?

Most start-ups lack ideal cash management skills which is the biggest reason why they fail to make their mark and manage their business operations successfully. This kicks them out of the competitive race which creates room and gives a chance to others to capitalize on the vacant space. Therefore, businesses try to fill this vacuum and acquire the services of professional accounting consultants to help them understand various financial aspects for better decision making.

Accounting and bookkeeping professionals can help you in many of the following ways.

  • Financial forecasting and planning
  • Analyze financial statements on your behalf and recommend ways to overcome cash flow issues
  • Determine the profitability of your business
  • Monitor influx and outflow of cash and help you achieve the right strategic fit
  • Expand your business with critical financial insights and knowledge
  • Save a lot of time and money and help you focus on the core of the business
  • Tax reductions, debt repayments, and more

Putting the Right Business Accounting Consultancy Services and Practices in Place

Accounting and bookkeeping professionals certainly have better understanding and knowledge than most of us. They know the tricks of the trade and are masters of the game as they can solely change the entire fate of a company with better financial decision-making. When you task them with authority, they are expected to live up to expectations and carry out their duties in the best possible way to the best of their abilities.

Thus, if you are expecting to grow your business in a competitive business environment, you must have the best possible business accounting and bookkeeping consultancy services and practices in place to equip and enable your business for success.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

 

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Fixing things has never been easy, especially when they are totally messed up. When things reach this point with a business’ bookkeeping records, they have two options to decide the fate of the business. 1. Close down the business and file for bankruptcy if it’s a corporation. or 2. Uplift the image of the company from scratch with several revitalization strategies.

Why do Most Businesses Fail to Manage their Business Books?

Being an entrepreneur, you may be more excited about establishing your business and less excited about managing its back-office operations. Every entrepreneur starts out with the best of intentions to make their business successful, which hopefully will bring significant gains in return eventually. Quite too often, front-office responsibilities and busy schedules cause back-office tasks, such as bookkeeping and accounting, to fall to the back-burner. This creates a lot of problems for the business. You certainly can’t expect to put your business on the right track and earn significant gains if you lack the financial wisdom to tackle important aspects of business such as filing tax returns, debt repayments, financial forecasting, projections and more…

Bookkeeping may be an intimidating task for entrepreneurs. However, now they have so many options to manage their business books with online accounting services, automated software, etc. Since most start-ups and entrepreneurs lack the expertise to handle back-office operations, business accounting consultancy services can employ the best practices, tools, and techniques to provide a clear snapshot of cash flow and finances for better decision making. Gone are the days when businesses tended to avoid acquiring such services as they lacked professional audits and accountability, along with concealment of sensitive information. Now businesses have not only developed a faith in these companies but consider them a pivotal tool for their start-up’s success.

First Thing First—Hire a Professional Accountant to Balance Out Business Books

Back-office tasks of every business are complicated as they involve tax requirements, debt repayments, financial reporting and forecasting, vendor invoicing, management and other similar things. So, the first thing that must be done when the business books become redundant is hiring a professional accounting professional who will fix things for you. Getting a business out of crises, especially when it is embroiled in financial distress, is extremely difficult. Therefore, only a person with relevant skills and profound accounting knowledge can lift the business out of turmoil. This further intensifies the need for hiring a qualified and seasoned accounting and bookkeeping expert.

Separate Your Personal and Business Account

Studies show that most start-ups fail because they don’t keep their personal and business accounts separate. This means that, prior to filing tax returns and debt repayments, you will have to go through messy business books in order to find the correct amounts. By keeping your personal and business accounts separate, you will get a clear picture of your finances and cash flow, which means you will be able to tally all the sources of income and expenses.

Track Every Expense Incurred

You need to label and categorize each and every expense incurred in the past and make a comprehensive plan to deal with tax and debt-related requirements. Therefore, you must record every single transaction if you expect to avoid unnecessary income taxes. Sole proprietors can afford to record financial transactions manually, but corporations can’t afford to conduct such practices. Hence, they must use accounting software with a suitable capacity to record and track all sources of income and expenditures for better decision making.

Reconcile Your Business Books

At the end of the day, it is all about achieving a right strategic fit and balancing out your finances. You need to reconcile your business books with actual spending and expenses incurred for getting your business on the right track. Getting out of crises is not easy at all, especially when your business is at stake. Although reconciliation will likely take a lot of time, hiring a seasoned accountant and employing the best accounting practices, software and techniques, you can face-lift the image of your company and perhaps give an all new positive image to your company. Reviewing your finances and business books at least once a quarter can help you determine the financial health of your business for making better financial and business decisions.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

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Hiring a professional bookkeeper or accountant is an ideal way to manage the financial books of any business. They minimize mistakes and catch potential costly errors plus save a lot of time and money.

Intensified Scope of Accounting Services

Have you ever wondered why there are so many accounting firms providing services? The answer is that the vast majority of businesses, including small to medium sized start-ups and established businesses, acknowledge the wisdom of employing an experienced and qualified accountant or bookkeeper to help them with numbers and their financial books. These professionals know the trick in handling accounting-related matters and help your business to flourish and grow beyond predicted scales. In order to hire a bookkeeper or accountant, you must look at the level of expertise you require for your business.

Hiring a Professional is a Wise Choice

Small businesses and new business start-ups often lack financial knowledge and struggle to maintain, record, and organize business transactions as well as update financial books and accounts. For piece of mind, small-scale business owners usually prefer hiring a bookkeeper or professional accountant which is indeed a fair choice for managing accounting affairs of the business. This not only helps business owners focus on the core affairs of their business, but also helps them to have a clear financial picture of their business which ultimately improves and eases financial decision making.

Why is a Financial Controller an Ideal Choice?

Small business owners may feel reluctant in hiring a bookkeeper or professional accountant as they consider it too costly for their fragile financial equation. Little do they know, hiring professional accounting services always pays off in the long course of the business journey. Investing a small portion of money to get a clear snapshot of the financial standing of a business is ideal for growth and development. Moreover, a bookkeeper also assists you in meeting tight debt or loan deadlines and ensures better compliance with tax requirements. Ideal management of accounting and financial books is the first step towards business growth and expansion.

Keep Your Focus on Core Business Needs

A business needs the attention of its CEO, especially when it is a start-up. One thing is for sure, a business cannot make its mark or grow larger if it does not have the owner’s focus. Not everyone is equipped to handle everything that a business demands and, often, business entrepreneurs lack financial knowledge, which is the primary motivation behind why they hire a bookkeeper to manage their finance related matters.

Ensure Correct Tax Filling

The last thing you want is to get stuck in tax discrepancies because you forgot to add important financial transactions or quarterly and annual tax filings. As an entrepreneur, it is quite difficult to manage estimated tax payments, corporate tax payments, and other similar financial records and projections. This is another benefit of hiring a bookkeeper, as they have the expertise to handle taxes, payroll, and other financial issues.

Ensure that Everything is Paid on Time

As a start-up business starts to gain pace, you need to create the right balance in managing your finances. For that, you must ensure that everything, from billing to all other expenses, is paid on time. Obviously, when you focus is diverted, it is likely possible that you won’t be able to manage the disbursement of financial payments on time. If you for things to accelerate in the right direction, you must hire a bookkeeper or professional accountant to stay on top of your bookkeeping.

Reduce the Cost of Financial Obligations

The fact is, a professional bookkeeper actually saves you more money than anticipated. Since accountants have the expertise in handling tough financial obligations, there is a greatly reduced risk of potential errors. Superior accounting services help businesses cut costs of operations and manage finances in an ideal fashion. Therefore, hire a bookkeeper or professional accountant if you expect to save time and money for a smooth and effective transition to the next stage of your business.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

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Bookkeepers help businesses with day-to-day accounting, recording important business transactions that are worthwhile. In short, they are influential people who are assigned the most important task: record, maintain, and update business transactions as they develop. But, is this evidence sufficient to hire a bookkeeper?

A Bookkeeper is an Invaluable Asset

There is no denying the fact that bookkeepers are an invaluable asset for a business. Large-scale businesses who have an enormous amount of daily transactions hire multiple bookkeepers who track and record every single business transaction happening throughout the day. The synergy between all bookkeepers working for a single firm needs to be present in order to achieve high business efficiency and productive outcomes. The point is, small entrepreneurial ventures may cater their daily bookkeeping needs from a software or spreadsheet, but, when the business grows, the bookkeeping needs also grow, which means it’s time to hire a bookkeeper.

When to Hire a Bookkeeper

When the right time to invest in hiring a professional bookkeeper is depends on multiple factors; when you find it hard to spare time for bookkeeping day to day business transactions, the size of the business grows, the frequency of business transactions increase, reconciliation of records becomes a mess, there are a lot of discrepancies in records, and certainly when the need for a professional bookkeeper becomes evident. Gone are the days when you had the option to delay your bookkeeping activities for a couple of days or even a week as the frequency of transactions was low. Now, you can never even think of delaying bookkeeping activities at all. Why? Because it will lead to disaster.

Choose Someone who will Deliver Optimal Results

In order to hire a bookkeeper, you need to search for viable options, those you see the potential in to deliver the best results. Since the entire business depends on accurate bookkeeping records, you need to make sure that you hire the best suitable person for your daily tasks. Although, it is true that DIY bookkeeping software is a cost-effective solution that can help deliver desired results, they are still not the ideal choice for most business owners. Investing in  a bookkeeper proves to be the right strategic choice since they can provide you with clear insight for wise decision making and future planning.

What Do Bookkeepers Do?

In short, when you should hire a bookkeeper can be answered with a well-acclaimed thought ‘the sooner, the better’. It’s a very wise idea to hire a bookkeeper to handle core business responsibilities such as recording of daily, weekly and monthly sales, invoices received from vendors, invoices sent to customers, expense receipts, and wages for payroll, etc. When a business grows, you are likely to require services of professional bookkeepers who, besides recording and categorizing every business transaction, will also reconcile the books at the end of each working day. The best thing about professional bookkeepers is that they know the art of creating and maintaining a healthy financial life cycle.

Investing in a Bookkeeper Pays Off

Future predictions and strategies will be based upon bookkeeping records—the more accurate they are, the healthier the results will be. To make the right decisions for your firm, you need to hire a bookkeeper who will ensure your company’s growth and success with their knowledge, skills, and experience.

Hiring a professional bookkeeper doesn’t have to come at a high price. Professional bookkeeping services are only believed to be pricey, but they are not. All that you need to do is make the right choice that fits your business needs and requirements and the results will prove to be significant. Whatever you invest in, hiring a bookkeeper will pay you off in the long run, time and time again.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

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Whether you are a bookkeeper or looking to become one, here are 7 traits that bookkeepers have that make them outstanding at what they do. Before you start a bookkeeping business or become a bookkeeper, ensure that you have these 7 character traits.

1.  A Positive Attitude

To boil it down, a bookkeeper is required to overcome a lot of challenges as they try to construct and develop their business. As a business owner, it can be lonely when there is no higher authority to turn to when things go south. You, alone, will be responsible for figuring out and resolving any problems. It is important that you don’t get down with a negative outlook and that you always address issues with optimism.  

2.  A Difference Maker

Being a difference maker simply means caring about your job. Make sure that you are satisfying your clients and do everything favorable for them. It won’t help you to be a bookkeeper who basically just does data entry. Make a difference by being someone who breaks everything down to look for the possibility of saving money within your client’s business. If you are able to do this, you will be considered extremely valuable.

3.  Hard Working

As with any job, this trait is essential. Whether it is bookkeeping or not, starting your own business requires tons and tons of hard work and patience. While having your own business has a lot of benefits, you should be ready to put in your hard work to kick it off effectively. You can never become a great bookkeeper if your bookkeeping skills are not up to the mark and you are not working hard to make sure that all of your clients are happy and satisfied with you as their bookkeeper.

4.  Organized

Any job probably requires you to be somewhat organized. However, when it comes to bookkeeping, it is essential for a variety of reasons. To begin, being a slob automatically means you are not going to be great with bookkeeping. Being organized is key to being more efficient and ensuring things run smoothly.

Another reason why being organized is important when it comes to bookkeeping is that, in many instances, you will be required to do “house cleaning” after signing on with new clients. This requires you to be capable of organizing and cleaning out the issues in their finances before you even start with the actual bookkeeping.  

5.  Able to Work Effectively on Multiple Projects

Not to be confused with the ability to multi-task, being able to work on multiple projects at one time means having the ability to determine the projects you are required to do first and the priority order you will be completing your tasks with. You are constantly going to have more than one client and they all will require your undivided attention. Moreover, each of these businesses of your clients are going to be at different stages and will require you to work on different levels as their bookkeeper.

6.  Detail Oriented

The importance of this trait in a bookkeeper is understandable. Ultimately, you are supposed to deal with the finances of your clients. Apart from that, if you are also capable of finding or suggesting ways your clients can improve their profits, there is a huge possibility that you will retain those clients for a long amount of time.

7.  Personable

Relationship are an essential part of the bookkeeping business. This is a major reason why clients choose you. If the people you work for are not able to connect with you, they will find it difficult to develop trust with you. Being personable is one of the most important character traits of any great bookkeeper.

As a bookkeeper, you are not just supposed to crunch numbers. You are required to crunch numbers while caring what those numbers mean and communicating with your clients as a human being, not just as an individual who just does the bookkeeping for their business.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

 

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In a business, you are involved in numerous activities that flow the money through your business. Fundamentally, you have money coming into small businesses and money going out of them. These money flows are referred to as transactions and they can be both positive as well as negative. To manage this money, every business needs an accountant/bookkeeper who can formulate an accounting primer specific to the needs of that business. It must be designed so that all the basics are laid out and everyone is on the same page about how to proceed with the objectives.

Small businesses usually rely on a person who is considerably good in a particular skill. If there are more than one partners, the person most skillful in the field may end up with managing that specific department. However, it has been observed that there is not a lot of accounting strength among entrepreneurs. Though, with persistence and an unblemished accounting primer, business owners can develop a financial understanding which can help them to manage current operations as well as future growth prospects. Here are some of the basics that are part of the primer for start-up businesses.

GAAP and Tax Basis for Small Businesses

After a lot of struggle and time, the accounting standard board has established generally accepted accounting standards (GAAP), which are responsible for the reliable reflection of business performance. It is different from the tax basis on grounds that the latter is more influenced by the government taxation laws. A newly developed business would not generally have specialties beyond filing a tax return. If that company needs a bank financing or enters into a deal with other businesses, it is probable that they would require your audited financial records. The records must conform to the GAAP in order to be approved by the involved parties.

Cash and Accrual Accounting Primer

When filing tax returns, small businesses must follow one of two methods in recording their revenues and expenses. Following the cash system of recording, any business would recognize a revenue when the check or money is received and similarly would record an expense when it goes out. The entry is made when the actual transaction takes place and not when the revenues are earned which is the case in the accrual system. Just like a construction firm would record the income at the time of work completion, even though they have not yet received the promised amount. Accrual method in the accounting primer is a preferable method as it portrays the accurate picture of business operations at any specific moment in time.

Small businesses usually opt for the cash method as it is manageable for them and also because it has a significant impact on the taxable income. However, if your business deals with a lot of inventory, it is better to opt for the accrual system of recording income and expense.

Direct and Indirect Costs

Direct costs are the expenses that are directly related to the manufacturing or procurement of a product or service while indirect costs are incurred anyhow, regardless of how you acquire the product and cannot be directly tied to it. The cost of buying all the components for a car plus direct labor costs can be termed as direct costs while rent, utility bills, and other similar costs are an indirect cost in the given scenario. This is an important concept to grasp for small businesses as they must be able to calculate the cost of making one additional unit. At the time of pricing your products, you would need to know all the costs associated with it and, therefore, an accounting primer must include all the information related to it.

Inventory Management

Keeping track of your resources and how you use them is an important element for businesses who desire to mark their presence in the market. There are two basic methods to keep track of your inventory which are called FIFO and LIFO. First in first out (FIFO) means that anything that’s stored first in the inventory should leave first and last in first out (LIFO) is just the opposite of that. Both methods have their own advantages and flaws, however, you may choose the one best suited to the needs of your business. The inventory price of some businesses fluctuate dramatically and using the right recording method becomes extremely critical. The accounting primer for small businesses advocates the need for consulting professional assistance in such volatile markets.

Depreciation

Depreciation accounts for all of the expenses occurred on fixed assets of a company. With time, machinery and other fixed assets of a business depreciate in value which needs to be recognized on the books in the form of a depreciation expense. Under law, it is compulsory for all businesses that meet certain standards to record the depreciation expense, however, small businesses are allowed to incur it immediately which can offer them tax relief.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

 

 

 

 

 

 

 

 

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2017 was a great year in terms of growth for the bookkeeping industry. The constantly evolving trends predict that there will be no slowing down in the coming years. Here are the 6 major trends to be look out for in the coming year.

1. Clients Are Going To Be More Fluid

Always remember that the advancement of technology, with convenience, also brings along its own threats. The rising trends of less paperwork and cloud based bookkeeping means that a client could easily transfer all of their data to a bookkeeping service of their choice in a few simple clicks. This leads to the requirement of such client service that stands out from other service providers. The major reason for the majority of the small businesses to change their bookkeeping service provider was the lack of proactive client service. Therefore, the bookkeeping service should be provided in a way that nail quality client service.

2. Most of SMEs Will Shift to Cloud

If the ongoing trends of bookkeeping continue further in the coming year, maximum SMEs will adopt cloud based bookkeeping services for the reason that it costs less, is convenient, and user friendly. While accounting software like QuickBooks and Xero are the international market leaders in providing bookkeeping services, it does not mean that these are the only options clients have, as every client has their particular requirements. It is imperative to appear as an expert in bookkeeping in the view of the clients. It is most important to be aware about the way in which the offered solution for bookkeeping adds value to the accounting services offered to the client.

3. The Future is App-Driven, Flexible Organizations

The actual strength of cloud based bookkeeping services is its flexible nature. For instance, Xero provides more than 500 add-ons in its system. Such add-ons provide bookkeepers with the opportunity to offer custom made services according to the preference of the client. The services that could be offered under bookkeeping are not restricted by the number of members in the team. Additionally, apps are low investment choices that allow the bookkeeper to demand a generous price that could be transformed into monthly packages over time.

4. Initial Salaries Are Increasing

During the current year, there has been up to a 4 percent increase in the salaries for bookkeepers and accountants. Businesses demand to build a relationship with its consumers and need to employ and retain the staff at a certain level. This is meant to provide a determined workforce with actual training and growth opportunities and posing as being flexible with working trends. After all, as of today, cloud based services offer support to their clients, even from remote locations.

5. “Trustworthy Consultant” Is Not an Objective Any Longer

A computerized, real time stream of financial statistics from clients moves toward a completely new era of service. The further profitable and dynamic path is consultation. Technological advancement has provided us with the ability to offer consultation in real time, based on recent financial numbers. The shift to consultation is the opportunity to become an indispensable part of the success of a business, rather than remaining just a financial record keeper.

6. DIY Bookkeeping Is Getting Easier

Software for bookkeeping and accounting is available at low prices and is becoming easy to operate. Along with that, online video tutorials are available on almost every topic, which also includes bookkeeping. For new entrepreneurs, doing bookkeeping and accounting by themselves may appear to be somewhat interesting. SMEs are inclining towards internal bookkeeping operations. There is a need to offer a good reason to make them work with bookkeeping solutions and their value that would be added to the business.

Final Note

With each coming year, there will be new trends in bookkeeping to create a stir in the ongoing practices and this year is no exception. Among the major competitors, there has been a 41 percent increase for QuickBooks whereas Xero observed a 51 percent growth in subscribers for the bookkeeping and accounting services based on cloud. With the upcoming trends explained above, it is beneficial to know the correct way to direct your efforts.


Check out America's Best Bookkeepers

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.


 

Team of consulting auditors auditing the financial report data of the company (balance sheet, income statement) on computer screen with business charts, fintech
It’s proves good for business when company players strike a pact to cooperate on a single mission, exchange technical proficiency, or advance their mutual profitable interests. However, governing organizations appreciate it even more when marketable bookkeeping alliances foster limpidity, compliance and accountability — fostering economic activity and financial statement consolidation along the way.

Accounting Statements

A company must print four financial data summaries at the end of a given period — such as a month, quarter or economic year. These comprise of a statement of financial situation, a declaration of profit and loss, a report of cash flows and a statement of changes in shareholders’ equity. If you review a company’s financial statements — especially its statement of profit and loss, year after year, you can see whether the industry has compensated for its operating transgressions and moved on from a profitability standpoint. A quick way to gauge that is going through its P&L and note profit trends over the years.

Consolidation

Consolidating accounting statements means adding up performance report data for two or more productions, depending on equity stakes and applicable guidelines. Think of it as totaling each financial item and ensuring the final bookkeeping result corresponds to the underlying percentage ownership — the other name for an equity stake.

When a company owns less than 20 percent of another entity’s equity, it uses the cost method — under which the investment value doesn’t fluctuate, unless the affiliate files for bankruptcy or copes with insolvency. If the investment business has a stake ranging from 20 to 50 percent, it uses the equity method.

Consolidated Accounting Statements

These declarations are useful for appraising the financial position and results of an entire group of commonly-owned businesses. Otherwise, reviewing the results of individual businesses in the group does not give an indication of the financial bookkeeping health of the group as a whole.

The key entities used in the construction of consolidated statements are:

· A group is a parent entity and all of its divisions.

· A subsidiary is an entity that is controlled by a parent company.

Therefore, consolidated financial statements are the collective financial for a parent company and its subsidiaries. It is also possible to have consolidated financial statements for a portion of a group of companies, such as for a subsidiary and those other entities owned by the subsidiary.

These statements require substantial effort to construct since they must exclude the impact of any transactions between the entities being reported on. So, if there is a sale of goods between the subsidiaries of a parent company, this inter-company sale must be eliminated from the consolidated financial statements. Another common inter-company elimination is when the parent company pays interest income to the subsidiaries whose cash it is using to make investments; this interest income must be eliminated from the consolidated financial statements.

Consolidated Accounting Statements with QuickBooks

If your business has numerous divisions or wholly owned subsidiaries, consolidating accounting statements from all of them gives you a complete picture of the parent company’s financial health. You can use QuickBooks to amalgamate statements, but it involves careful bookkeeping. Under some conditions, you’ll need an exaltation or use of third-party software to import the financial data into QuickBooks.

QuickBooks lets you categorize transactions by class, giving the user great flexibility in how to define class. If your business has several divisions but is still a single legal entity, elect a class to report profit and loss by division. Be certain to identify each operation by its class, however, to keep the reports accurate. Beginning with QuickBooks, you can produce a new balance sheet report by class, displaying assets, equity and liability, and a consolidated balance sheet for the company.

Final Note

With QuickBooks, small businesses can reduce monthly costs while optimizing productivity. The key benefits are to eliminate many expenses and connect to financial institutions for free instead of paying a monthly fee. It can also provide access to more users, store data for free and includes many more benefits.

Check out America's Best Bookkeepers
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.

 

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What do a construction project manager, a creative design director and a pastry chef have in common? Evidently, as small-business owners, each one of them opened up an outlet to serve clients and do what they love rather than spend hours on bookkeeping or accounting.

 

Being a small-business owner, you might have an inborn entrepreneurial attitude, but you are less likely to be adept at accounting. Hence, it is possible that you will have found bookkeeping a tedious activity, better say a dry distraction, especially when your main focus lies on building your brand and boosting your business.

 

Fortunately, many modern-day artistic entrepreneurs and small-business owners can leverage an ever-growing suite of business tools and organizational technologies. They can help lower the stress of managing invoices, receipts and bills while spending more time on grabbing new business opportunities. In fact, how businesses record their expenses and revenues has radically changed over the last few years. In addition, more and more businesses are switching to cloud computing to benefit from the online accounting and bookkeeping tools and to help streamline their core functional processes. Therefore, you should also consider migrating your present accounting data and workflows to the cloud. The tools securely host all of the relevant and necessary databases and servers, helping you access your data anytime and anywhere via an internet connection.

 

Here are the top five logical reasons to incorporate cloud accounting into your business to ensure improved efficiency and increased profits:

1. Have easy access to your data anywhere, at any time

The main reason that cloud-based invoicing and accounting tools are so popular is that they allow easy access to your financial data from anywhere, at any time. Since they host remotely, you do not have to worry about any kind of time-consuming downloads and updates. In fact, busy professionals like you can keep up with their business information on the go and even access their invoices by using the mobile app of the online accounting software. This renders added flexibility and peace of mind as you do not have to be sitting in your shop or office to access your accounts or check your cash flow. Also, you will be making important financial decisions quickly instead of having to go through endless piles of paper containing old and outdated information.

2. Enable smart business for a distributed workforce

As accounting information and financial data stored in the cloud can be accessed or added anywhere, your team members can easily and quickly finish their work, irrespective of their physical location. Whether a project manager has to verify an invoice for a supplier or a sales representative has to add expense receipts, having cloud-based invoicing and accounting tools in place makes accessing any organizational information as simple as taking a picture of a document or searching by a date, vendor or amount.

3. Verify Discrepancies

Vendor-Customer relationship is a top priority for almost every business. However, we have all seen situations where accounting discrepancies put vital relationships at stake. Cloud-based accounting and bookkeeping tools make it easier to better verify and locate exactly where error or omission took place through advanced yet easy-to-use searching capabilities. Hence, small-business owners no longer need to spend hours and hours searching through old invoices as smart tools are waiting to benefit them.

4. Maintain Vendor Relationships

When an accounting omission or invoice discrepancy is located through online accounting software, it can promptly be brought to the vendor’s attention. This easy and smart process ensures that it is easier for you to maintain relationships with suppliers because, instead of being frustrated with how long it took to identify the discrepancy, they will appreciate you for quickly finding it and thereby resolving it.

5. Reduce Overhead

It can cost you a lot to maintain your own business server, local storage devices and networks for your small business. However, you will no longer be required to bear the costs of maintaining a server system, upgrading to new software versions, or hiring an IT professional to keep up with your system when you migrate from traditional ways of recordkeeping to smart tools of cloud-based accounting technology.   

6. Leverage a broader suite of secure apps

Cloud-based accounting and bookkeeping applications such as QuickBooks Online and XERO not only provide easy and secure access to information and data from any remote device having internet connection, but they also integrate with many other cloud-based tools. Hence, as soon as you begin using cloud-based recordkeeping technology, it is fast and easy to extract and leverage accounting data across a number of different online platforms and save time spent on manual data entry.

Final Note

One thing is for certain, revolution in accounting technology has definitely taken place. Desktop-based system software is dead while cloud-based applications are ruling everywhere!  If you want to spend more time on doing what you love and be smart and more efficient with your record keeping, then cloud accounting is an unbeatable option for staying on top of your business finances.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.