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Accounting and bookkeeping are the key functions in any business. Small businesses face challenges in accounting and bookkeeping procedures. Accounting is the systemic and comprehensive recording of financial operations in a business. Business bookkeeping is the recording of financial transactions as a part of the accounting process.

Entrepreneurs and business owners often do not see that common small business accounting mistakes are a major threat to the growth of their business in the long run.

Biggest Bookkeeping Challenges For Small Businesses

Not Using the Best Accounting Software

Choosing the correct software is among the biggest accounting challenges that small businesses can face. An important and challenging step in business is to choose the proper software per your business needs. Consider it’s cost, usability, and extra features when choosing a suitable bookkeeping software for your small business.

Features of an accounting software must include:

  • Inventory management
  • Sales tracking
  • Contacts management and contact history tracking
  • Account to accept credit card payments
  • Generating invoices
  • Financial statements, cash flow statements and balance sheet
  • Budget planning
  • Payrolls
  • Taxation matters

The cost of an accounting software is an important issue to consider. First, plan out your business needs and finances. Purchasing a costly software with highly-advanced features will not help your small business if you do not need these expensive features. A small business owner can plan to purchase an accounting software by providing a full payment at once or they have the option to make payments in installments or monthly payments. Plan to purchase the software that suits your business finances the best.

Financials are Incorrect

Incorrect financials is a threatening accounting problem in your business. If your financials are incorrect, it may sink your funding round in your business.

Any error in your financial statements leads to big loss. Business bookkeeping and other business operations will go into a mess if you do not keep your financial data up to date. Your accounting statements must be clear and transparent. Income and expense statements must be precise and related to the cash flow and balance sheet. Delayed data entry is a big risk of frauds and thefts.

Financials are not Produced Monthly

In a small business, it is often thought that it is okay to produce financials on a quarterly or bi-annual basis. However, monthly financials show investors that you are closely monitoring your business.

It can lead to negative balance if expenses are made but no income statement is updated. Invoices to be paid by the company may go unnoticed and it can put a bad reputation on a company. It can end terms with the suppliers. Business growth is halted or significantly reduced.

Business Owners mix Personal Finances with their Business Account

If you mix your personal and business finances, you cannot correctly estimate how much profit was generated out of your invested capital.  For example, if a business credit card is utilized for personal expenses during a trip or dinner, later on, this amount could be paid from the company’s income.


Covering Small Expenses out of Pocket without Recording

Paying  for business expenses out of your own pocket will eventually make your company look stronger in income than it actually is. It is extremely important to record everything so that you have a true picture of where your company stands financially.

Starting New Projects and Ideas without a Clear Budget

If you start a new project in your business without planning for it, you can easily run short of your budget for other business operations. You may have to quit the project in the middle if you don’t get the loan or find other investors. It’s important to always plan ahead before making big moves.  

Not Using Accounting Software or Cloud Technology

Failure to set up the correct software needed by your company leads to poor decision making. Installing the wrong (more complicated than required or lacking crucial functions) software can lead to more complexity in accounting. Accounting software prevents accounting and bookkeeping errors. Many software come with guided help boxes to make an accounting process easier to interpret. Inventory control tools are provided in software. Tax matters are made easier using accounting software.

Poor Interpretation of Accounting Information

Accounting information software is only a tool to use. Decisions must be made after completely checking the reports and interpreting the data. Data interpretation is made by comparing financial statements with the cash flow statements and balance sheets. This interpretation can be complex and hard to understand, therefore hiring a bookkeeping service may be ideal.

Entrepreneurs and business owners must focus on the long-term consequences of decisions they make after getting the full picture of accounting information. Making short term decisions after interpretation of accounts data does not provide the business with any long term benefits.


Conclusion

Small businesses face the biggest accounting challenges. Either they are running short on resources to keep an up to date accounting and bookkeeping picture or they are not using the correct software for their accounting. From choosing a proper accounting software to managing accounting tasks correctly as well as keeping them up to date are among the biggest accounting challenges that small businesses face.

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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QuickBooks is a complex accounting software that requires proper knowledge and training. The nature of the application is quite multifarious which can create problems for users with little or no prior training.

Every department of business has multiple software for managing their workload online.  A sales force of a business uses a CRM system (Customer Relationship Management) to manage their customer feedback, connectivity, customer complaints and all other customer-related tasks. Similarly, to manage accounting and bookkeeping related tasks of a company, businesses often use proper systematic software that can help them in managing their finances. QuickBooks is one such amazing accounting tool that is mostly adopted by small to medium scale businesses.

What is QuickBooks Software?

QuickBooks is an accounting software designed by Intuit Inc. The software provides a set of accounting solutions to businesses which help in managing the payroll, inventory, sales volume and multiple other small business functions. The software’s key features are:

  1. Marketing based tools
  2. Products and supplies
  3. Services for the merchant
  4. Training solutions

However, every solution is designed in accordance with the needs of the business and industry they are operating in. The best thing about Intuit’s business solutions is that they have customized products for every contractor. For example, construction contractors get:

  1. A QuickBooks Enterprise solution for contractors
  2. A QuickBooks Premier contractor
  3. A QuickBooks Pro
  4. A simple starter plus pack

All of these products are specifically designed to meet the needs of the contractor to small to medium-sized companies. This makes QuickBooks the most powerful software which cannot be learned by using a trial and error method. Learning this software requires extreme practice and proper training. However, even trained QuickBooks users skip a few essential tips and tricks that can help in making the accounting and bookkeeping processes easy.

4 Things that you Didn’t Know you could do with QuickBooks Data

  1. QuickBooks is a gold data miner with different versions with different prices and features

As you already know, QuickBooks does not only come with one single software to fit every industry. Rather, it provides multiple solutions to its customers according to their needs. The features available in QuickBooks depend on your business type and the growth of your business. The data you will record through QuickBooks will be all yours. Once your data file is created, you have free access to all of the data which can be later used in a business analysis for your customer survey.

  1. Integration with other business applications that can indicate critical information about your business

Most small-scale businesses have multiple desktop or cloud-based software that help them in carrying out their business operations. By integrating this software with QuickBooks, you will be able to utilize your QuickBooks data with other business software. There are many other business applications that are now providing QuickBooks built-in integration.

  1. Utilizing QuickBooks Data

QuickBooks data has all of the major information about a business’s customers, products, employees, productivity level of employees and the volume of business sales. To best use this data:

  • You have to eradicate the data from QuickBooks and place it in the analysis database.
  • Then, you will need the tool for reporting and analysis process which is properly integrated with QuickBooks data. It will then allow you to see any type of data you need.
  • For bookkeeping purposes, you will be required to create a QuickBooks report that will help you in visualizing the data on a regular basis.

  1. It helps in decision making

As you save and monitor the data of QuickBooks in the shape of reporting files, your company will make more accurate decisions. You will be provided a clear picture of your business that will allow you to make wise decisions for your company’s 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.

Businesswoman making to do list on diary
In traditional business accounting, the term overhead expenses refers to costs that are not directly associated with the production of specific product units, specific service engagements, or specific sales. “Overhead”, instead, denotes the supplementary costs of production, service delivery, or sales activities. The overhead costs have to be paid regularly, irrespective of whether the company is engaged in a high or low volume of production. It is vital, not just for the sake of budgeting and bookkeeping, but for setting an optimum price for the products and services to make a profit.

Firms plan, quantify, and examine overhead expenses. As a result, overheads, like other expenses, eventually influence how an income statement proceeds. With the increase in expenses, the profits decrease. Your income statement is affected, as a whole, because of these expenses and you have to make required adjustments to cater to them.

Overhead Expenses in Business Accounting

Overheads are either fixed, which means that they stay the same month after month, or they can be variable, which means that they can vary depending on the business activity for the specific month. Some overheads fall into the semi-variable category, which means that they are incurred regardless of business activity, and some are related to the circumstances. Utility bills can be categorized as semi-variable because some of the base charges are fixed while the remainder depends on your usage.

Overheads can be general as well as departmental. A general overhead would be distributed among the whole company while departmental overheads are charged strictly to the specific department. Typically, a service-based business will have more general expenses in the form of insurance and utilities.

Categorizing Overhead Expenses

Overheads can also be applied to many operational categories such as administrative and marketing. Administrative overhead costs are related to the administration of the business and include costs associated with hiring and keeping a receptionist or bookkeepers. Branding for your company also involves certain costs that fall into overheads. Your business accounting needs require you to identify these materials, commercial, printing, and other expenses and charge them into overheads.

Reporting for Overheads

Because the overhead expenses directly affect the profitability of the company, they appear in the income statement of the company. You must account for overheads in order to determine the net profitability of your company. These expenses will be deducted from the revenue and the remaining income, after taxes, will determine your profits.

Applied overhead is generally recorded under the cost accounting method and is charged to a specific department or production job. They are quite dissimilar to general overheads and usually cater for depreciation and insurance expenses.

For business accounting purposes, applied overhead expenses are charged according to a specified formula over multiple departments. For example, if the expense is incurred by marketing, it may not be fully allocated to it. Instead, it will be distributed among various departments according to a specific percentage.

Overhead Rate

To allocate overheads, an overhead rate is applied which determines the resources used in the production of each product and then distributes the expenses accordingly. One way to accomplish that is by setting a fixed rate based on the machine hours required for the production of a product. This is a simplified approach, however, real-time business accounting scenarios require you to account for several cost drivers and then set an overhead rate.

It can be difficult to accurately estimate the overhead expenses. Therefore, the costs are generally estimated depending on the overhead rate for each cost driver.

Under Applied Overheads

Sometimes the assigned cost of work in progress goods does not equal the assigned amount and therefore has to be reported as a prepaid expense on the balance sheet.  Debiting cost of goods sold at the end of a year offsets the discrepancy. Under applied overhead costs are also referred to as unfavorable variance.

Adjusting your books for overhead expenses is an important task that must be undertaken by every business if they want to correctly estimate their profits and set an optimum price for their products.

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 order for small businesses to manage and run their business expenses smoothly, it is essential to keep tabs on your cash inflows and outflows. No question about it, the significance of proper expense administration for any magnitude of business is huge. The execution of the best businesses practices is a giant factor towards the revenue, growth, and, eventually, success and achievement of the business.

Bookkeeping is an excellent way for small and medium-sized businesses to manage their business expenses. The concept of bookkeeping cannot be stressed enough, be it in any kind of occupation or any kind of management. By efficiently handling and keeping tabs on business expenses, owners can gain a multitude of advantages:

Block Unseen Sinkholes

At times, your money is lost in places it should not be. By managing your business expenses well, you will easily be able to find those unseen sinkholes.

Maximize Income

By getting rid of wasteful expenditures and making the best use of items that are considered tax deductible, business owners have a chance to achieve a noteworthy aggregate of revenue.

Generate Prospects For Growth 

For businesses owners, it can be a huge deal if they are aware of where their money is being spent. Not just that, it also makes a big difference in finding out how effectively that money is being spent. These two aspects are a big factor in the preparation and accomplishment of future growth of the business.

In order to improve your business expense tracking technique, business owners should implement the below practices in their business:

Be Certain That Business Expense Policy Is Firm, Clear, And Fair

The business expense policy of your company needs to be well-founded, fair, and unambiguous. If there are any exceptions, they should be set aside for exceptional situations. The organization should make sure their managers, employees, and clients are familiar and well-aware of the policies set in place.

When formulating a business expense policy, the one thing that should remain a priority is ease of communication. After all, you don’t want your employees to go through the company textbook every time they have a question just to understand the business expense policy. The key here is simplicity.

Keep Your Business Expense Reporting Procedures Clear And Simple

Keeping the importance of simplicity in mind, we will further elaborate with the next point. When we talk of simplicity, it has its benefits and advantages. The first point is, the simpler you keep your business process and procedures, the more your employees will be able to comply. The more simplified the procedure is, the more your employees will stick to it.

Secondly, if the procedures are complex in nature, it will increase the chances of inaccuracy in managing the business expenses. The more administrative boxes and excel spreadsheets you have that need to be entered, the more chances there will be a blunder made somewhere. These are blunders that could possibly end in forfeiture of an expense entitlement.

Finally, and most significant of all, simplicity means speed and swiftness. If the system is simpler, your clients and employees will spend less time on the business operations.

Gather Relevant And Required Information For All Business Expenses

When it is time to file tax returns, the one factor that can immediately kill the likelihood of you getting your hands on any money is non-compliant invoices.

Whenever a reclaimable expenditure is incurred, the associated invoices and receipts will guarantee you of getting your money back. This is why it is extremely important to save those invoices and receipts so that they can be accepted for a tax refund by the appropriate taxation office.

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.


QuickBooks Accountant and Tax Reports provides you with financial and tax information in the form of reports that contain adjusted journal entries, trial balances, listings of fixed assets and income tax details. You can save a considerable amount of time and effort through the use of bookkeeping tools such as QuickBooks. If you would rather have an expert opinion on the matter, QuickBooks offers you a way to prepare a copy of your data for your accountant or bookkeeper. You can limit the amount of access you want to offer using the customization tools in the software.

Accountant Only Reports

This kind of report would contain information for your accounting employees. Adjusted trial balances and journal entries are the main features of such reports. Entries that are posted to the general ledger are fully detailed in the report.

Account Activity Reports

All of the transactions and activities that took place related to your account are the highlights of such reports. Some of the major reports to be included are mentioned below.

General Ledger

The General Ledger is basically a list of all of the transactions that are posted to the respective accounts. It is the job of an accountant or bookkeeper to keep track of beginning and ending balances and include them in the general ledger.

Trial Balance

The ending balance for each account is highlighted in this report. These reports give you a clear picture of your current financial position. This information is important in terms of your future strategy for the business.

Journal

A journal report highlights all of your recent transactions in the form of a listing. The listing is always in chronological order.

Audit Trail

All changes that are going to affect your company books after a specific date are shown in the audit trail.

Voided Transactions

This is a report that consists of all null and voided transactions. An accountant gets the report ready in the accounting software, along with its history. The history is a detail of why the specific transaction was canceled or called void.

Listings

QuickBooks is also quite efficient in providing you the detail of all of your accounting lists. The name of every company related account, along with its remaining balance, formulates an account list. The fixed asset listing, which is a detailed description of an organization’s fixed assets along with their date of purchase and cost, helps the accountant make informed decisions.

Income Tax Reports

Filing an income tax return that is error free and on time is imperative for any business. The process must be completed by a professional or someone who has a complete understanding of IRS rules and regulations. QuickBooks allows you to make a variety of income tax reports for multiple purposes.

Income Tax Preparation

You have a chart of accounts and an assigned tax line specific to each account. The preparation reports give you a complete picture of your finances and taxes associated.

Income Tax Summary

The amount that has to be reported on the income tax form, as well as information about how it was determined, forms the essence of an income tax summary. You can either include the detailed description in the summary or form a separate report for that. It is completely at an accountant’s digression.

Some other reports that can help accountants in better decision making are as follows.

Financial Reports

Financial reports include your balance sheet, cash flows, and income statement. These are vital to decision making. Details about your accounts payables and receivables can be gathered from these reports. Knowing what you owe or others owe you is critical in terms of your future strategy.

Sales Reports

Sales made, orders placed, and pending orders are included in the sales reports. The sales team hands over the information to the accountant, which is then converted into readable information that makes sense. Sales are usually raw numbers, therefore, to make sense out of the data, you have to make the report in a way that is easy to comprehend.

Other types of reports include vendor and payable reports, payroll reports, budgets and forecasts. All are vital to the success of any organization.

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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Financial dashboards for businesses are essential for evaluating daily business operations on a regular basis. Financial dashboards guarantee to keep the business on the right track. It is one of the most vital elements of any business. Businesses may use various techniques to invest in a proficient financial management program to ensure that the best practices for proper inventory management are followed.

Financial management is a major part of any business’s supply chain management, manufacturing, customer relations and every business activity. The stock inventory management aims to have the correct products available for sale. Tracking inventory in real time is effective in streamlining the entire operations process.

The dashboards help the business to have the correct products available at the right time. It prevents out of stock products and funds from being tied up in surplus stock. Moreover, stock inventory management helps your business ensure that all products are sold in time to prevent spoilage. It also saves millions.

Benefits of a Financial Dashboard

Financial dashboards provide a complete and detailed overview of an income statement with net profit, revenue, and other relevant performance ratios. Each dashboard represents four crucial financial indicators such as the operating profit, net profit margin, OPEX ratio, and gross profit margin.

The revenue is found in determining the selling price by calculating the total cost of goods sold without including details considering any other taxes and expenditures. The dashboards allow businesses to consider certain costs associated with their operations on a daily basis for bookkeeping.

One of the main metrics for these dashboards is the inclusion of income before interest and taxes or EBIT. The dashboards consider calculating all expenses and costs before interests; then the applicable taxes are included in the overall cost to determine net profit.

Calculation of Gross Profit Margin by Dashboard

The Gross Profit Margin for any business is essential for determining the total sales percentage with the revenue that remains after the bookkeeping of all direct costs with goods and services. The gross profit margin is useful in estimating how much the company has to invest, determines spending on research and development, and how effectively they can contribute towards earning a profit.

Top 3 Financial Dashboards for Your Business

Entrepreneurs are preoccupied with daily business operations and, often, they do not have sufficient time left for handling their finances. Many financial dashboards are available to help business owners effectively handle their finances. Most dashboards offer easy to read charts with colorful graphics. The most effective step for start-ups is to use online dashboards that help them track their finances as they are unable to hire an expert bookkeeper to manage business finances.

Here are some affordable business dashboards that will determine how to handle the finances of any business.

inDinero

inDinero was launched in 2010. This financial dashboard is suitable for start-ups. inDinero gathers all business transactions from the bank history as well as credit cards details and other financial documents are efficiently organized. The business owner does not need to spend hours in data entry. Just save the account number and bank information and it automatically categorizes transactions. Some of the categories of transactions are:

  • Advertising
  • Payroll
  • Dining and refreshments
  • Another spending for every month
  • Accounting reports

BodeTree

BodeTree was introduced as a financial dashboard in 2011 in partnership with Intuit, the company that launched QuickBooks. BodeTree relies on QuickBooks to assess different financial information from those who rely on QuickBooks for bookkeeping. It needs to be connected to the QuickBooks account. Once the connection is complete, it categorizes and generates a breakdown of all activities and expenses associated with each operation.

The BodeTree dashboard is named after the legendary Bodhi Tree, where the Buddha reached nirvana. Similarly, the dashboard will be able to determine a benchmark for the business depending on their algorithm based on the transaction and expenses history.

Corelytics

The Corelytics financial dashboard was launched in 2005; this dashboard works by importing all of the financial information associated with the business. It gathers information from different accounting programs including Sage, PeachTree, MYOB, and QuickBooks, among others, for the financial dashboard. After all of the information from each accounting platform is collected, Corelytics will get to work by categorizing every metric. These metrics, once generated, can monitor every transaction. Some of the metrics are:

  • Expenses
  • Gross margin
  • Revenue
  • Receivables
  • Owner compensation
  • Profits

Financial dashboards allow setting goals and objectives for each of the metrics above. The Corelytics financial dashboard highlights every single metric with different colors. The colors determine when each metric is not performing according to the standards of the business. This financial dashboard is one of the most useful for every business. It comes with a mobile application, allowing the business owner to monitor the activities on the move for better bookkeeping. It also won the Showcase award for the best dashboard.

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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Small business owners face the job of making sure that all of their accounting procedures are conducted as efficiently and accurately as possible. On the whole, company owners have to make a choice between a manual accounting method or accounting software programs. An accounting software system has many major advantages towards achieving faster growth in a company. More and more companies are choosing to use this method for the following reasons.

  1. Time Saving

One of the most important advantages provided by computerized accounting software is that it can save huge amounts of time for small business owners. They can easily make calculations for operations such as billing and payroll performed efficiently and quickly just by using accounting software programs intended for small businesses. They can also have access to their accounting records swiftly without having to go through huge files of paper. Businesses can give more time to their customers and focus more on their marketing functions which will help their business grow further.

  1. Reduced Errors

Manually “number crunching” presents opportunity for human error. This error can be costly for any small company owner who happens to be in a rush to finish an accounting task. Calculation errors can occur due to inaccurate inventory counts, incorrect total sales receipts, along with many other reasons.

With the help of computerized accounting programs and software, there is a drastic reduction in calculation errors. If you have accurate accounting information, it will also help you escape any tax blunders that could possibly lead to complications and difficulties with the Internal Revenue Service.

  1. Centralization

Using an accounting software in a business helps centralize and unify many aspects of the business’s financial management. A small business owner will easily be able to undertake tasks such as payroll, invoicing, inventory management, and some sides of customer relationship management, all from an accounting software program. A business owner will save money and time because of centralization as long as the owner does not need to buy separate software programs in order to perform operations such as invoicing customers.

  1. Makes Tax Compliance Straightforward and Easier

Besides presenting the amount of tax that is to be paid on particular invoices, accounting software also aids the business owner in preparing reports. An example of this scenario can be the amount of a particular tax the business owner has been paying during the course of a certain period. Also, accounting software makes it a lot easier to collect the information needed to complete and apply for essential government tax forms.

  1. Provides Tools for Analysis

If a business owner uses an accounting software, it will be just like having their own in-house financial consultant. The customizable reports will allow the owner to analyze and examine various aspects of the business as well as provide the information and statistics needed to make better and more informed financial judgments. Reports, such as a balance sheet, help summarize exactly just how well the business is doing.

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.

 

3d illustration of folder finded in big archive cabinet
The financial systems of the yesteryear are gone. With financial technology becoming easily available and the technological revolution, there are plenty out there. Fintech is making pathways for professionals like accountants and bookkeepers who have massive amounts of paperwork to deal with. With the web evolved and technology galore, traditional financial systems are biting the dust. Not just due to the advancement of systems and technologies but from obsolete physical systems that pose a danger to security and reliability as opposed to digital systems. These systems are heavily undermined as they cannot take advantage of innovations in the digital world. An accounting department filing cabinet is one of those systems.

An accountant is a professional that deals with taxation which makes it legislatively important, for starters. They also help with portraying the financial health of a business and evaluate credit worthiness. Measuring, processing, and coordinating financial information of economic entities is called accounting. It is the summation of an organization’s activities related to economics and uses information related for users such as creditors, investors, management and regulating authorities. The scope of this field is vast and, due to its broad usage, tax accounting and auditing are also a part of it. An accounting department filing cabinet is part of it’s processing and practices.

The Evolution of Accounting

Accounting is centuries old so it is not hard to understand the need for standards and regulations in this vast field. The 21st century practices differ from the last century due to the formation of bodies and other authorities that govern the laws of accounting such as GAAP or IFRS. Having been around for so long, the accounting profession is desperately in need of an upgrade to better fit into the digital era. For classification needs, an accountant needs to record all particular asset details and information.

Like the accounting department filing cabinet, all records are known to the accountant and where they are stored. Like skeuomorphism, where models are made to depict real-time objects that are imitated, using century-old methods like cabinet systems pulls down the potential of an organization, thus making a profound impact that generally allows competitors to move ahead. The physical attributes are such as the cabinet versus digital filing.

Depending on the requirements of an organization, the cabinet holds information that is vital for the progress of the business which leads to growth and development. In a physical system, such as an accounting department filing cabinet, it is crucial to know where the information lies, which folder has it, which section it underlies, etc. Anyone who is assigned that task will be grateful and appreciative of how the data is stored, retrieved, managed and organized. There are many fields where data can be stored under categorization like copying papers and placing them in various places for ready reference but this practice is wild as workloads grow and paper management becomes a curse.

To allow more freedom and ease in life, accountants use a prescribed system of account classification such as billing, costs, expenditures, and physical goods that help them acquire information readily unlike the accounting department filing cabinet.

The digital era of our modern world has various concerns. Let’s take hashtags, for instance. Anyone on social media is aware of it while hash tagging pics of friends or a tweet. The nature of this is that hashtags are unstructured data in the domain of big data. It’s not compatible with accounting as structured data is used for financial reporting or training. Without reinventing itself, it cannot use hashtags as information organization but, upon realization of this problem, accountancy has to think up new ways to develop and grow to accommodate a modern world’s needs.

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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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It is exciting to initiate a start-up business. Nonetheless, your business adventure can turn into a scary reality if you lack the creative wisdom to read the market and manage your small business finances well. Developing a unique business strategy and dealing with all of the admin involved is surely an intimidating task. For entrepreneurs who are good at numbers and have expertise in accounting, it may be easy to manage and maintain their financial books. However, most entrepreneurs may be good at conceiving a creative idea for a start-up business but lack accounting knowledge, skills, and experience which restricts them to manage their business’ books and finances accordingly.

The Success Lies In Accounting

Undoubtedly, accounting is the most crucial aspect of running a business. It doesn’t matter whether your start-up is of small scale or large, the core of business success lies in accounting. In the early stages of small business development, it is most essential to keep your start-up on track. You can only expect to give your start-up an ideal kick start if you have the know-how to track and manage your money effectively. Entrepreneurs usually lack money-management skills which pushes them to either outsource their accounting activities to a professional or automate their accounting systems using advanced bookkeeping and accounting tools and techniques.

A small business needs a lot of attention right from the very beginning, especially in the accounting and finance domains. For that, you need to come up with a comprehensive money-management plan or else your start-up will fail like the majority of start-ups usually do. The fate of the business solely relies on your efforts on the accounting side of the business  as well as epic judgment based on current and future accounting projections. Therefore, if you expect to get your start-up on track or put your small business on the road to success, you need to do following things.

Open a Bank Account

Manual recording and cash management of all accounting transactions will land you in a deep mess, if not now, then inevitably. It’s best to open a business bank account for the ideal management of money. Keeping your personal and business account separate will make tax season far less complicated. Moreover, it will give you a clear picture of your finances, i.e. the influx and outflow of cash, which is healthy for a small business in each and every sense.

Co-mingling your personal and business accounts will probably land you in deep trouble for mismanagement of finances, which may even lead you to a point where it would be better off to close the business rather than continuing it further. You need to play the right card (opening a bank account) in the initial phases of business development for getting your start-up on track.

Track and Monitor Your Expenses

Tracking your expenses for a defined accounting period is probably one of the most important steps in accounting. For a small business, tracking expenses is not an alien job. All that you need to do is record all business transactions right away for avoiding accounting discrepancies. A small business usually qualifies for unique tax breaks or deductions. If you expect to claim those tax deductions, it is the requirement of the IRS to keep records of everything you spend such as bank and credit card statements, bills and receipts, invoices and proof of payments, previous tax returns(if any), canceled checks and any documented evidence that support your claim expenses.

Establish a Bookkeeping System

In business terms, bookkeeping is the day to day process of recording transactions. For a small business setup, you likely have three options to manage your business transactions; you can do it yourself, you can hire in-house support or you can outsource this activity to an outside party. The bookkeeping decision usually depends on your business’s structure, size, and accounting needs.

Continue Refining Your Methods

By embracing strong accounting tools, techniques and practices, you can expect to turn your small business adventure into a big success. You need to modify your systems and methods in order to manage your accounting tasks effectively. For ensuring the long-term success of your business, you need to create a system and upgrade it constantly for helping you to maintain your profitability and improve your bottom line. Staying on top of your game will allow you to streamline your processes that will not only get your start-up on track but will also help you grow and expand your business operations.

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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 the present times, the increasing urge to abandon manual systems in order to automate business processes has led to businesses opting for software to ease their accounting and bookkeeping processes. One of these prevalent software have been POS (Point of Sale) systems. The conventional days of using a cash register and solid-binding registers are long gone. These traditional practices have been replaced by advanced technological inventions such as the POS software. Below mentioned are a few ways that a POS system is helping businesses with their accounting processes for increased efficiency.

Real-Time Reporting

With the help of a POS system, businesses can now get real-time detailed sales reports, cutting down the manual tasking that was once required to generate each report. These reports are an essential part of the accounting process since sources and segregation of revenues must be identified to calculate profit or loss for a particular accounting period. In addition to this, these sales reports can help with identification of possible lags, which may then be amended. Improved strategies may be put in place to help boost sales and for increased efficiency as the latest sales reports can be accessed in real-time.

Inventory Management

POS systems can also help with efficient management of business inventory requirements. This inventory management comprises of aspects such as reordering level, when to reorder, and whether a certain product in the inventory is running low or not. Keeping track of inventory has become crucial for all businesses especially in retail, owing to the impact a stock-out can have on one’s business reputation. Moreover, the selling pattern of products may be drafted out using the POS system and inventory refurbishments may be done accordingly. Products with higher demands will have a higher Economic Order Quantity (EOQ) relative to those with low demand and sales. This results in increased efficiency as the accounting process will become less complicated and there will be no paperwork involved. Moreover, time savings is yet another benefit that may potentially be actualized from POS implementation for business accounting.

Better Customer Service

POS systems have helped business accounting such that customer satisfaction has gone up following its implementation within the business. With lower sales-related discrepancies and accurate pricing details sent over to customers through the system, the accounting procedures have become agile and hassle-free. This has led to happy and satisfied customers that are a source of good word-of-mouth. In addition to this, customers are now provided with a range of payment options such as debit/credit cards, gift cards, cash, etc. This has enabled increased efficiency in processes which are now automated and streamlined for enhanced performance.

Information Tracking

In addition to the benefits above, POS systems have also allowed for a seamless tracking of all personal information, be it regarding customers or vendors. This personal information consists of payroll information, customer billing, shipping details and statuses, vendor listings, quotations, receipts and invoicing, and basic profiling. This is a source of information that is required for business accounting processes, allowing for increased efficiency as well as improved management of resources.

User-Friendly

POS systems help with business accounting, provided that it is easy to learn and use within the organization. The software implementation is usually resisted by most of the existing employees within an organization as innovation such as this takes them out of their comfort zones. However, POS systems are both easy to install and maintain, alongside its user-friendly interface. You may train staff on the use of POS without facing much resistance. Integration may as well be achieved with various other applications being used within the business. This feature of the POS allows for increased efficiency, not through its use, but its acceptance within the organization.

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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.