What is Useful About Small Business Accounting

Business Accounting Most of the difficulties of a company come from poor management or accounting. Paradoxically, it is to this area that entrepreneurs provide the least effort. Indeed, entrepreneurs who lack training in business management prefer to spend their time on more exciting activities: selling, customer care, communication, products (which is understandable). That is why we suggest a few tips to follow for a successful small business accounting.

The key to Small business accounting does not only have to do with numbers

I put this point first, since it is most important. Accounting is not an end in itself but a tool.

It is true that most of it has to do with keeping track of what comes in and what goes out of the business. However, if you look closer at the information small business accounting gives you, you should be able to see trends in sales and expenses for example. When you focus on the long term trends, accounting becomes more useful and interesting. It tells you what happens every day, it highlights the problems, but it can also help you to solve those problems. You can make small business accounting if you only changed the way you look at it.

Routine practices for a regular and consistent small business accounting

The secret is to get used to performing accounting tasks and making them part of your daily or weekly routine. For instance, you may see that it makes it easier to choose a day during the week to perform a task. You can write checks and make deposits on Mondays. You can also decide to call your debtors on Tuesday. By doing this, you will be able to keep an eye on your finances without feeling like you are doing it.

Examples of small business accounting tasks to perform regularly:

Verify what your fixed costs will be for that month and anticipate for the following. Pay attention to what you spend this and the last month. Make sure you verify all credit card payments. Keep track of accounts receivables. Remember to send the invoices to the customers. Ask your accountant to verify the work you do. Keep track of cash flow trends, etc.

By Wade Henderson

Accounting Software

With the start-up of a new business comes a wide range of choices. Often, accounting software is not the most top of mind concern. However as a company grows, the need for a more robust accounting software package becomes evident. The basic software package that was installed upon startup lags behind and cannot keep up with the complexity of the growing business. Here are five main ways that basic accounting software packages differ from more advanced (or mid-range) accounting software.

Ability to Customize: The longer you are in business, the more you realize that your business has a unique set of needs. For example, you want to show a special field on your invoice, or you want to start tracking information by sales category or by project. With a basic accounting software package, there is limited ability to customize, and therefore you must make due with a system that is made for the masses. Advanced accounting packages recognize that your business develops its own specific needs over time as it grows, and therefore allows for customization.

Data Limits: This is a major different between basic and advanced accounting software packages. A basic system will only allow for a finite number of things like inventory items, concurrent users, transactions, accounts, etc. Often this is the main reason for needing to upgrade to a more advanced system. When your business starts to require additional data storage, this is when a more advanced system can really make your life easier.

Reporting: Again, for the sake of ease of use, basic accounting programs provide a limited set of reports for you to run. Yet your business may really need to see the data in its own way. For example, perhaps you want to include a line that shows the subtotal per item with tax. A more advanced program will allow for revisions to be made, and the reports can then be saved for later use, so that you can view the information in a way that is more helpful to you and your accountant.

Accounting Software Data drill down: How easy is it to view all of the details of a transaction when you are looking at your business numbers on a report? In a more basic system, you will likely need to close out the report and go searching through layers of information to find the details. By contrast, a more advanced system will allow you to view the transaction details that make up the number with just a few clicks, and will even allow you to edit the information on the fly.

Service: As with any product available today, the end result of paying too little means your service will be less as well. Many basic accounting software programs will defray service expenses by outsourcing their service to an overseas call center. More advanced programs provide more complete support services, with a variety of contact methods, and technicians with years of experience.

When choosing accounting software for your business, be sure to consider all of the above points so your system will grow along with your business.

By Stephanie Elsen

Small Business Accounting Explained

Accounting Below we give you some tips on how to make small business accounting more bearable for you.

First, you should make a list of all accounting tasks to perform in your business. Once you have your list, small business accounting is less stressful and takes less time. You will only have to perform one or more tasks at regular intervals (daily, weekly, monthly ...).

We also recommend that if do not know a lot about small business accounting, learn the basics.

Small business accounting is a specific jargon and all sorts of words and concepts reserved for the experts. Do not be discouraged if you do not understand them all. Get used to the most basic concepts directly related to successfully improving your small business accounting. Ultimately, the goal is that you increase profit. It is the primary goal of any business. Request help from a professional if you want, but do not miss the basic concepts.

In contrast, it is a mistake to become a super fan of small business accounting. The company does not come down to accounting. There are firms and professionals who do this very well. This is not the job of an entrepreneur to be a know-it-all of Management or Accounting.

The third golden advice is to separate your personal finances from your business finances.

It is a bad idea to mix your personal account and your business account. Separate them completely: even if you're the sole shareholder in the company, even if only your money is put into the pot. This separation enables you to plan, predict, without confusing personal cash and professional cash. This allows a lucid view of the true accounts of the company.

Finally, you must be consistent.

It may be hard to get used to at first but we recommend that once you create an accounting system for you, you should stick to it no matter what. Remember to register everything, forget nothing, and be consistent. If you are not consistent you will start doubting your own system later which will not help you when you want to evaluate your business performance at the end of the year. It is a good idea to meet with your accountant to have him or her verify the information.
By Wade Henderson

Accounting - A Foreign Language

Accounting is the language of money.

It really is a language. And, like other languages, you can become fluent in it. Becoming fluent in accounting will take about as long as becoming fluent in any other language. Instead of using letters or characters, accounting uses numbers. The confusion starts here - most of us have had exposure to mathematics, so most of us understand the concept of numbers. While this may be true, most of us are not able to understand accounting as a language.

When a young boy first learns his ABC's, he will be able to pick up a book, flip to any page, and tell you what every letter on that page is. He knows those letters. He knows them well. He understands what they mean. But, does that mean he understands the book? Of course not! He can't read!

So it goes with accounting. Most of us can pick up a financial statement, and we can point out all the numbers. A woman point to profit and say "See? This is positive one-million. This company has made a million dollars." But, those trained in accounting knows that this company may not necessarily have made a million dollars. Just because she recognized the numbers does not mean you have any idea what is going on in the statements. Just as the young boy had no idea the story of the book, the woman had no idea the story of the statements.

Most people have no idea that accounting is a language as such. It's not their fault - nobody told them so. But, it is. It enables you to do many things. A doctor does not see a body and see just a body - he or she sees a number of systems all working with each other. The doctor can see one part of a system and see how it effects the other systems connected to it. When a system is not functioning properly, the body becomes ill. Just the same, an accountant does not see a piece of stock or a business as just a business. He or she sees it as a collection of systems, too. It is like X-Ray vision into a business. One can tell what parts are working, where the strengths and weaknesses are, and the history of the company. One can really read the story behind the financial statements. A good investor will see which "stories" are good, and he or she will invest his money in those companies.

Here's a question for you - does it make sense to invest in a company if you cannot read its story?-Accounting

By Cody Scholberg

The World of Accounting As a Lucrative and Challenging Field

The World of Accounting-If mathematical rational expressions, equations, variables, and arithmetic sequences and series are second nature to you, an accounting course or career may be the perfect field you can get into. Have you ever found yourself enjoying the company of addition, subtraction, multiplication and division? Is number crunching and solving problems an easy feat? Do you think mathematical expressions like (x + 2y = 4) is an effortless equation to answer? If you acknowledge mathematics' simplicity, there's no doubt about it, the world of accounting is a place where you definitely belong.

Charting your way towards this field known as one of the hottest trends is easy. At this point in time where almost all businesses are in need of accountants, CPAs, financial analysts, and internal and external auditors, choosing an accounting career would definitely spell a lucrative profession for the math-geek and for a number-genius like you.

As an accounting major and a budding accountant, auditor, or analyst, here are few accounting roles, duties and responsibilities you can expect in the workplace:

1. Financial reports and evaluations are yours as a major task. This involves roles in financial management, maintaining appropriate accounts, business outflows, and keeping financial compliance requirements among others.

2. Upholding financial efficiency and financial investigation is also another job. This is an accounting role specifically tasked to an auditor. If you opt for this position, you will be responsible in controlling your own company's financial outlays and also in investigating probable frauds and fiscal inaccuracies.

3. Forecasting analysis could be one of the challenging roles to partake. In this line of profession, being financial analyst is perhaps one of the most profitable yet taxing and challenging jobs in this field. Here, you are expected to devise a major plan for the company's profitability, project further earnings, and above all, be geared up in going with the present and future trends in the market.

If you are knowledgeable and skillful in realizing any of these fields, you sure will be successful in your chosen path that is accounting.

By Elija James

Real Estate Accounting - Solution for All Your Accounting Problems

Real estate accounting is a hard job. When a firm is small and does not have a lot of business to afford a CPA, then the entrepreneur has to manage all the accounting work. This becomes a tough task. Accounting entries are not simple and each entry needs to be recorded twice. The books of accounts should not have a single mistake else they will not tally. The owner will have to make sure that the figures are not misstated else the profit amount would vary and so would the payment of taxes. The other important reason why maintaining clear accounting entries is important is because there are a lot of people directly and indirectly related to the business who are concerned about the way the business is progressing and the only way to find out is through the books of accounts. The books of accounts speak to the reader telling him about the way the business is going. Hence the owner needs to make sure that the books of accounts in the real estate business is up to date.

Real estate accounting can only be done by a professional. A CPA or someone who has a lot of experience in dealing with the accounts of a real estate business can manage the accounts. The reason why owners don't hire a CPA is because they add to the cost and make the profit margins diminish. The way to stay ahead from the competition is to write the accounts by oneself or outsource the work to some agency that specializes in it. There are a lot of agencies that maintain your books of accounts in return of a very low fee. The reason is that they do bulk accounting and due to the economies of scale their cost comes down helping us get a huge discount in the accounts department.

There are plenty of firms that specialize into the real estate field. One should however select the agency with infinite care. There are various ways to go about looking for a good agency. One can look for it online or through the yellow pages or even via a friend who has had a good experience with an agency. The source from where one gets to know of the agency is not important only it is important to keep in mind that the real estate accounting outsourcing is that the agency should meet all the requirements set by you. For that it is necessary to make a list of all the things we require and compare that list with all the agencies we find suitable.

Once the comparison is done, the task becomes easy. We can then select the agency we find most preferable. A discussion on the price and the quality of work done is then to be held with both the parties in question. Outsourcing can be a boon or a bane and before entering into it one must be sure of the consequences. Yes, they provide cheaper work with better quality but there would be no privacy and the agency could manipulate or misuse the data given. - Accounting

by Alvis Brazma