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Small Businesses And The 2010 Budget

The 2010 emergency budget has done small business very little good, if any. In fact, it has actually harmed the potential for growth for many such businesses, meaning that they will have to be even smarter at managing their resources to survive or thrive. Most small business sell direct to the public, who following the budget will have less spare cash in their pockets and less job security.

A small business needs good cash flow to be able to stay in business. If cash stops coming in, a business can very quickly go into a downward spiral. At times like these, a good accountant is essential. An experienced accountant can review your cash flow and suggest ways to improve it and to minimise the impact of reduced cash flow on your business.

Large businesses can weather a period of financial crisis much more easily than a small one. They have more assets, which they can use to borrow against. Generally, they have larger margins, which they can cut to take them through the lean times. However, there are still areas where small businesses can make savings; good accounts help a great deal in the task of identifying them.

Had the government’s emergency budget included: the freezing of business rates or the subsidising of commercial rates, this would have really help existing small businesses and people who want to set up a new small business. Since the budget did not include either of these measures, small businesses need to consider if they can reduce those overheads themselves. They may for example be able to move to smaller premises. Your accountant can help you to work out the true cost of such a move, so that you can see if doing so makes sense for your business.

Reviewing your business plan with your accountant after a budget is important at the best of times. In the current climate it is even more important that you understand all the implications that the budget has for your business.

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Tags: 2010 budget, accountancy, Accounting, Auditing, Finances, financial, tax

Business Accounting – How Much Attention Are You Paying?

Businesses will have a hard time remaining profitable without having a means of monitoring how profitable each venture or service is for them. Through using business accounting you will be given the tools to do just that. This service does not only let a company store data and track cash flows as most believe, it also allows them to spot failing ventures, capitalize on profitable ones as well as spot wasteful procedures. There are many uses for business accounting that can help any business.

For example, consider that your accounting records show that you usually go through around $1000 each month on paper, ordering multiple times each month. Using this information collected through accounting you are able to see this pattern and make a forecast allowing you save money. You will be able to bulk purchase paper and get yourself a sizeable discount. Not only will you be able to see ways you could easily see money, you can monitor how profitable each product or service line is and focus on the ones that make the most money and cut the ones which you are losing money on.

Business accounting procedures run the gamut from the very basic to the extremely complex. A small organization with just a few sales might be able to get by with a ledger book and a pencil. Companies with hundreds or thousands of transactions in a given day will likely use an automated system designed for their corporation. There are many programs available for those companies that fall in between these two extremes. A good spreadsheet program, like Microsoft Excel, can help track sales and costs. Programs like QuickBooks come with additional accounting features that will also categorize your cash flow and forecast financial performance. These programs can be found on-line or at any software retailer, and can be a very helpful tool. The only caveat with these packages is that the results they generate are only as good as they data they receive.

Some small companies vouch to have a single business accountant to help them keep up with their books, but not all of them necessarily need one. Smaller companies also can enjoy the perks of an accounting by outsourcing the job. Larger companies however will nearly always employee one or more accountant to keep up with all the long term needs. Either way, it is important to have some type of accountant on hand if you are dealing with any serious amount of financial.

As you can see, properly applied business accounting techniques can help any size company. This method will help ensure not only that all outstanding payments are received and bills paid, but will also help you recognize new markets, develop new ideas, reduce inefficiencies and waste, and develop a sound business strategy. Any business that is looking to move forward cannot ignore the need for business accounting, and neither should you.

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Tags: accountancy, accountants, Accounting, business, business accounting, Small Business

Is It Time You Hired A Bookkeeper?

Bookkeeping is a full time job. It includes keeping records of invoices, purchases, time cards, paid time off, paychecks, withdrawals, deposits and much more. A good bookkeeper is hard to find while accountants can be found just about anywhere. A bookkeeper is right there, with the business and the business owner, learning intimate details of how the business works and what needs to be done to keep it successful. A bookkeepers books can be taken to an accountant for tax purposes. Many people often confuse the two jobs. The only thing that separates the two jobs is usually a college degree.

Bookkeeper’s can choose between single-entry recording systems and double-entry recording systems. The single-entry system is used by many small businesses and only utilizes income and expense accounts. However, the double-entry system that uses a balancing system of debits and credits is actually more accurate and will ensure that the books are truly accurate. In the double-entry system, every transaction is record in two different areas of the books.

A bookkeeper can record all the business transactions in ledgers, journals or on a computer database. Everything that is involved in the business including sales, purchases, cash, credit, pay outs, and other items are recorded in these very important places. Everything that is spent, bought, or sold throughout the days events are then recorded in these types of journals, whether digital or not, so that the business has an accurate accounting at the end of the week.

Each section of your financial database will have different subsections that will have a place for all of your transactions. This helps you see what is coming in, or your sales with customer data, and what is going out, or your supplies with distributor information. Then there are sections specifically designated for taxes, your current inventory, your current debt, your daily income and your general expenses.

A bookkeeper will periodically, usually once a week, make sure that the books are balancing properly. What they can do is either print out the database or go through the ledger line by line to make sure that everything is balancing properly. This includes creating a credit and debit column starting with a day of the week, usually corresponding with when your sales week starts and when it ends. This is a good way of making sure that there are not any mistakes in your bookkeeping that could possibly create a ton of problems down the road.

Bookkeeping is not a simple job and the task is not one that is done quickly. Most companies require at least one full-time bookkeeper and it is common for large companies to have several bookkeepers. However, smaller businesses may outsource the bookkeeping work by hiring a service to handle this job for them. When a bookkeeping service is used, a bookkeeper will spend a few hours a week at the company working on the records and being sure that the books stay in balance.

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Tags: accountancy, accountants, bookkeepers, Bookkeeping, Outsourcing, Small Business, taxes

Things To Consider When Hiring A Tax Accountant

Filing your taxes can be a difficult and stressful ordeal to handle, not to mention any mistake can cost you a lot of money. A tax accountant can relieve all the stress that emanates from an intricate tax filing system. Not only will a tax accountant find a myriad of ways to lower next years taxes for you, he or she can also make sure there are no issues when you submit your taxes to the IRS.

When it comes to your business, additional services can be rendered by putting a professional tax accountant to use. Not only will a tax accountant monitor and analyze cash flows, but he or she can go over any information necessary as the time to file taxes approaches. Furthermore, a tax accountant can help you use the law to work for you instead of against you, garnering the many tax breaks that are available.

A tax accountant works for both the IRS and you; they will keep the IRS happy by helping you pay, but they will give you the most cost efficient way to do so, helping both parties in the long run. If you have a tax accountant who is not up to snuff, however, they will try to get you to break laws and go through all kinds of ethical hoops. That might save you a bit more money, the IRS will eventually audit you for that missing amount.

Think about these factors as you look for the right tax accountant:

Understanding What You Require – Look for a specialist who knows the type of tax laws you will be facing. There is not a single person who has encyclopedic knowledge of everything, so look for a tax accountant who has been in companies of similar size and business type. However if you are simply looking for some for personal use, there are those who work on laws that pertain to individuals.

Good Reputation And Testimonials – Ask the tax accountant in question for a list of the clients that they have had in the past; this will help you find out whether or not they have worked well with other customers they have had. If they check out, you can feel free to bring them on.

Staying Current – There is not a year goes by when a code is changed or a law is passed. There could even be jail time associated with not changing your business to work with the law. An excellent tax accountant continues their education and stays current on new tax codes.

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Tags: accountancy, accountant, Finance, Small Business, tax, tax accountants, taxes

A Guide To Mobile Bookkeeping Services

Outsourcing services is becoming a common practice in the business world. Allowing a third-party expert to handle certain needs in your business allows for increased focus on the areas that are making you the most money. Therefore, you may want to consider a mobile bookkeeping service. If you need to cut labor costs, or your business is just wasting too much time with bookkeeping, then this could be the perfect solution.

Many businesses need to hire a full-time bookkeeper in order to cover the paperwork and reports that are required by tax law. Some businesses find keeping track of this data in house to be too costly and time-consuming. This is where a mobile bookkeeping service can be extremely beneficial.

When it comes to bookkeeping the need for a full time bookkeeper is not determined simply by how many sales your company makes. Instead it is about how much account activity takes place, such as bill payments, invoicing, and the size of your payroll etc. This means that even if you have a $6m million company, you still may not need a full time bookkeeper.

For small to medium sized businesses there may not actually be a need to have a full time bookkeeper on staff. It can simply be a waste of money. If you were to hire a full time bookkeeper they will need to be paid all year round even when there is little work for them to do. With this the case a mobile or independent bookkeeper may be a better option, they can show up when required or even take care of the books off site and supply you with them once they are done.

You do not have to outsource every aspect of the bookkeeping either, you can keep some of it in-house and then outsource the more time-consuming aspects to an independent bookkeeper. This is why mobile bookkeeping services are rising in popularity and are a great solution to keep your financial records updated.

Though most businesses do not associate a beneficial and time-saving service as the lower cost alternative, mobile bookkeeping services are often less expensive than a full-time bookkeeper. Most importantly, the business will have trained professionals preparing their information – lessening the chance of a fine or tax mistake that leads to unwanted penalties or taxes. In addition, the company saves the cost of hiring, training, and employing a full-time bookkeeper when it actually only needs the service of a bookkeeper on demand.

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Tags: accountancy, accountants, Bookkeeping, Finance, mobile bookkeeping services, Small Business, taxes

Should You Outsource Your Bookkeeping?

As a business owner, you know from first hand experience how busy you are. And you also know that time is money, and spending time trying to balance numbers and figure out tax codes is not the best use of your time. That is why it is a good idea to get outside accounting help when it comes to keeping your business books. Outsourcing your bookkeeping will save you not only time, but also money. Independent bookkeepers work on a per contract basis, know the tax codes better than you and will not have to pay for their benefits (health insurance, vacations, etc.)

An independent bookkeeper will not ask for paid time off, nor do you have to worry about training them on other tasks involved with running your business. If you do not like how they conduct themselves or do your books, you can always stop doing business with them and find someone else. And you do not have to worry about paying for unemployment insurance if you do “fire” them since they are not employed by you. You should not have to face these issues anyway if you go through a reputable company that has happy clients. Your best bet is to ask other business owners who they use and get that companies contact information.

Another bonus to hiring freelance bookkeepers is if you wish you can hire those with their own offices who will fulfill the job off site. This saves you money on office space and furnishings and you need not worry about their productivity away from the office because they will be paid for the fulfillment of the contract and not on an hourly basis. So, they get the same amount no matter how quickly they complete the job, although there will of course be a deadline.

Another benefit to outsourcing your bookkeeping is that you could actually see your profit margin rise instead of decrease because you are not hiring a brand new employee. You can negotiate with them what you need them do, how often you need them to do it and how much they should charge you for their services. If you have a small operation with a few employees, then you will not need them as much. If you have a large operation, with multiple forms and filings every single month, then you may need them more. But rest assured, they will be able to do the job for you, no matter how big or small, quickly and competently.

Doesn’t it just make sense to hire an outside accounting expert to take care of your business books for you? Payroll, taxes and other pertinent forms will no longer be your concern as long as you give them the information they need to get the job done. Remember the old saying though – “If it sounds to good to be true, then it probably is”. Do not go with someone who says they know what they are doing but has no references to back them up. Ultimately, it is up to you to make sure that your business is successful, and a great outside accounting expert can help you get where you want to go.

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Tags: accountancy, accountants, bookkeepers, Bookkeeping, Finance, Outsourcing, Small Business, taxes

Advice On Whether Or Not To Hire A Bookkeeper For Your Business

Every business, whether brand-new or well-established, is required to keep a thorough record of all of the company’s financial undertakings. Many business owners find it a challenge to decide where to make best use of their money, time, and physical contributions. Add to those important decisions the fact that many business owners also have no experience with bookkeeping and you can see how this could make for a very stressful situation.

One option for dealing with bookkeeping requirements is to simply outsource it to somebody experienced in the field. Letting someone else take care of the books leaves the business owner free to pursue other important focal points such as advertising, human resources, client contacts and so-on. Knowing that there is a professional and competent entity in constant and direct communication with the business owner is a source of great comfort and satisfaction.

However there are also reasons supporting the argument for a business owner covering their own bookkeeping. One thing every business owner should consider is the massive benefit to understanding the intricacies of their business finances. If a business owner knows how to handle their own bookkeeping they will have a deeper understanding of not only their finances but their business as a whole. They will also be able to use this information to influence the quality of their business decisions in the future.

The best way to have a deep understanding of your company finances is to understand the bookkeeping process and how it relates to accounting yourself. Having a clear idea of where the numbers originate can be beneficial to your perspective of the business as a whole. There is also the fact that having accountants tell you about your finances will never compare to having a deeper understanding of them yourself, no matter how good they are.

Ultimately, the decision is a personal choice which must be made with multiple factors in mind, such as how much money you can devote to hiring a professional, and how much time you have to search for a reputable one. If you plan to undertake bookkeeping on your own and have little or no experience in doing so, it would be to your benefit to seek out the advice and guidance of an expert who can help you to learn what you need to know to confidently keep your own records. Keeping in contact with such an expert in the future can also help you to avoid making serious mistakes by staying current on any rule-and-regulation changes that you may be unaware of otherwise.

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Tags: accountancy, accountants, bookkeepers, Bookkeeping, Outsourcing, Small Business, taxes