Simplified Accounting Solutions to Streamline Your Business.
A complete range of accounting services and efficiency tools that give your small to mid-sized company a competitive edge.
A complete range of accounting services and efficiency tools that give your small to mid-sized company a competitive edge.
We can help you grow your business. Leverage our solutions, technology and expertise to provide your clients with incremental service offerings. Or outsource the lower margin tasks to us while you focus on higher revenue generating activities.
CPA firms typically experience an influx of clients during tax season who all require the same expertise and timing on their tax filings. Year after year, firms juggle client work with trying to maintain their own business development efforts and ongoing operational requirements during this busy period. One solution for addressing this situation is to call on re-enforcements for some of these functions:
However, these solutions bring their own challenges. The CPA firm may not be able to find and hire the relevant level of expertise; and if they do manage to find reliable resources part-time, the hired resources would still need availability and access to infrastructure on which the work can be successfully carried out.
Partnering with a provider who can offer the expertise required by the CPA firm can prove to be immensely helpful. Partnerships augment existing resources while helping close gaps, if any, in terms of expensive infrastructure or expensive skilled resources.
Partnering can also resolve the dreaded resource crunch at tax time through judicious accounting throughout the year. One of the key requirements for a smooth and hassle-free tax season is stringent adherence to good accounting and bookkeeping practices, year round. By partnering with a firm that can help streamline CPA clients’ bookkeeping, the CPA firm can complete tax filings more efficiently and more productively leaving time to focus on higher margin activities.
Here are some benefits of partnering with another firm to outsource some of tasks associated with preparing client files for tax filings.
Partnering with a firm that offers outsourcing capabilities can help CPA firms by offering them access to a proven and reliable infrastructure. A partner that offers outsourcing capabilities most likely also uses a proven back-up system, which is a huge benefit for a CPA firm, given their volume of clients and deliverables.
When partnering, choose a firm with manpower that offers expertise and experience working within the industry. This can assist the CPA firm with meeting timelines with work that is high quality without any compromise.
Skilled manpower also means the CPA firm can manage high volumes efficiently. Regardless of tax time demands, the partnership ensures that all deliverables are met reliably and on time. This allows the CPA firm to still manage other operational needs, as opposed to having them fall by the wayside to address until after tax season
Partnering is one of the best ways for CPA firms to add value to their existing clients’ work. The partner’s established infrastructure and resources can be leveraged to add value to accounting or even increase the scope of work while maintaining the quality level and timeliness.
Finally, with a strong partner, the opportunities for business development increases as CPA firms may be able to resell the partner’s services which are complementary to their own to their existing clients. Often once of the largest challenges for firm owners or partners can be carving out time for business development activities or planning for service expansion opportunities. Partnering with a company who offers complementary services provides the CPA firm’s clients with access to reliable services under the same roof, without compromising confidentiality, etc.
Analytix Solutions offers customized solutions for companies ranging from accounting and bookkeeping to more complex requirements. For more information on how we can assist with your partnership needs, call us at 781-503-9004 or email us at [email protected].Partnering for Profitability: Tax Season Help for CPA Firms
Small businesses should not ignore relevant tax deductions. Tax deductions help businesses lower their taxable income.
However, tax deductions differ according to how a business is structured. A sole proprietorship will have different tax deductions than an S corporation or a partnership, even if the differences are marginal.
According to the IRS website, tax deductions are subtracted from the income before calculating the taxes owed.
Following are the top five deductions that are applicable to a small business.
1. Start Up Expenses
This deduction accounts for the expenses associated with starting a business, including office space, supplies, tools and equipment. These costs may be categorized as organizational costs and are applicable for up to a year after the business launches.
2. Travel Costs
Travel costs are tax-deductible if a vehicle has been utilized for business transportation purposes. The deduction applies to fuel and vehicle maintenance. To apply this deduction, maintenance and repair receipts, proof of fuel purchases, etc. are required. The deduction may be calculated a few different ways:
Actual expenses: Costs are calculated based on the actual expenses made on fuel and repair and maintenance work. This is also applicable to the depreciation expenses on the vehicle.
Standard mileage rate: Costs are calculated as a fixed or standard amount for each mile that the vehicle has driven. Parking fees can also be included in this method.
In case of business-related travel including hotel stay and airfare, deductions claimed need to be substantiated, including information about when and where the expenses were incurred. Hotel stays and airfare are 100% deductible while meal costs are 50% deductible.
3. Home Office Deductions
Home office deductions are available when an area within the home is used exclusively for the purpose of carrying out business. Here are some details:
4. Wages and Employee Pay
For small businesses, deductions are also granted for the wages paid to employees. Furthermore, a start-up may hire contract employees. The cost of contract manpower is a deductible expense for a business. If you are deducting the cost of contract manpower, make sure you are issuing the Form 1099-MISC.
5. Health Insurance Premiums
Sometimes, businesses can be penalized for not providing employees with health insurance. Fortunately, premiums paid on health insurance are deductible. This deduction is valid whether the policy is in the name of the business or the business owner. In order to claim this deduction, the business needs to pay the premium for the employee and their dependents.
Maximize Your Deductions
While the deductions listed above are illustrative of those applicable to a business, in order to optimize available deductions it is best for a business to talk to a professional who understands tax laws well enough to advise the business best.
Furthermore, remember, timing is everything when it comes to tax filings. The earlier a business takes stock of tax liabilities and deductions, the easier it is to benefit from them.
Analytix Solutions offers customized solutions for companies ranging from accounting and bookkeeping to more complex requirements. For more information on how we can assist your business, call us at 781-503-9004 or email us at [email protected].Top 5 Deductions for Small Business
For a small business to survive and ascend the growth curve in the current business landscape, it is important to stay abreast of changes and new trends. This is especially true when trying to ensure value added opportunities for clients, both returning business and new business referrals.
With 2018 settling in, this is a good time to highlight some trends that influence and impact small business accounting.
Automation technology has greatly improved the reliability of accounting data and maximized time savings, both in terms of accuracy and helping business owners reduce time spend on accounting so that they can focus on other opportunities such as business development. A bigger benefit of technology and automation is that it promotes stringent compliance, especially for businesses with high volumes of data or the need for multiple categories. Technology helps with faster and more accurate categorization in business accounting.
Technology improvements have also made significant progress with tax filings. There is technology to scan and convert paper receipts into digital formats and even to ensure tax forms are completed automatically without omitting entries. As a result, automated tax preparations reduce the rush during tax season and lead to a much better controlled process, virtually eliminating missed entries and or missed tax obligations.
As technology automates the time-consuming data entry tasks and accounting categorization, the accounting professional is free to focus on higher priority initiatives such as business growth and development. This means an accountant no longer rushes to complete tax forms, balance the books, or ensure regulatory compliance. Accountants can increasingly add more value to critical business aspects, such as budgeting and forecasting, investments, and better tax planning and savings.
In the current environment, regulatory compliance is critical. If a business largely operates in the cloud, security concerns can nearly double as both the business’s data as well as information and data belonging to clients resides there.
Security becomes a high priority with multiple layers, including software configurations, authorized access of personnel, etc.
Financial reports are the lifelines of any business. From investment decisions to expenses, simpler and easy-to-understand reports will be the focus in 2018.
Furthermore, as automation addresses reporting too, financial data becomes less confusing and more visual with charts and graphs. Visual financial data will also be a growing trend. Visual data also makes it easier to identify gaps and challenges.
At Analytix, we help small to mid-size businesses ascend the growth curve by offering more streamlined operations. For more information on how we can help your business gear up for a more successful 2018, please contact us at [email protected] or 781-503-9004.2018 Business Trends That Impact Small Business Accounting
As complexity in the tax environment grows, small businesses are facing a dual challenge:
Tax processes automation can be very useful in managing business taxes, especially since automation takes care of accounting figures from the start, thus ensuring reliable numbers to begin with – a significant tax time requisite. Only when accounting and bookkeeping figures are reliable will the tax calculation be accurate.
What Is Tax Process Automation?
Automated tax processes are quickly replacing the older and more traditionally followed method of manual entering data into tax forms. Tax process automation is the use of software to automatically record data entered manually on tax forms and save it in a searchable format.
Businesses may differ in the software they use, as well as in the manner in which they use it. For example, some tax software will capture data from tax forms manually filled, while others start with accounting and bookkeeping processes.
Some tax software performs accounting tasks such as reconciliations of cards and accounts, automatically recording data from receipts, and also performing functions of data validation.
There are several benefits of moving to an automated system:
Call the Professionals
Currently, most businesses on the growth curve still follow the old method: collect as many receipts and invoices available, provide them to the accountant at tax time, and then hope for the best.
In the new regulatory environment with legislation focusing on risk management, it is up to every business to hold itself accountable and ensure tax filing is correct. Automating the business’ tax processes is one way in which to ensure this. Automation begins at the very beginning: helping accounting and bookkeeping log every transaction and monies that are due to ensure watertight records. Depending on the kind of automation level and software used, accounting records also get updated and tax forms filled. When this happens at a baseline level, the transaction figures recorded are reliable and not dependent on memory. Furthermore, automating the tax process ensures that transactions are recorded without any loss in time or accuracy.
Experts, including outsourcing agencies, can help you gain the maximum out of your automated tax processes. Delegating this work to an outsourcing agency can prove to be doubly helpful because it takes the responsibility away from the business, thus removing the hassle and worry. The outsourcing agency offers the infrastructure and manpower to manage tax responsibilities, and is also equipped to troubleshoot situations if necessary.
At Analytix Solutions, we have been helping businesses, including startups, efficiently file their tax returns year after year. Our breadth and depth of experience helps us to better understand clients’ unique accounting requirements. We formulate customized solutions and incorporate industry best-practices. This allows business owners to address their challenges in a systematic manner, helping to streamline operations. For more information on our services or to find out more on our complementary assessment of your accounting procedures, visit us at www.analytixaccounting.com.Benefits of Automating Your Tax Processes
Most decisions in a small business are often driven by the budget or additional money available to invest in the business. Hiring resources is no exception, and the decision to hire a CFO may be deferred on the grounds that it could be too expensive for a small business. However, not having access to a CFO’s expertise can mean the difference between a business that grows systematically and one that struggles along the growth curve, at times challenged by obstacles to their growth plans.
Fortunately, small businesses have the option of outsourcing a CFO which still provides them with access to the expertise needed to grow their business.
Why A CFO Is Essential For A Small Business
A CFO empowers a business to grow faster through planning and executing financial strategies, as well as proactively working alongside operations and management. A significant part of this work includes using data and information from across business operations, including finance, to formulate strategies that can then be implemented profitably.
With many businesses leveraging the virtual workspace and cloud technology in some form, data analytics play a major role in the ways in which data is recorded and reported. Technology has grown, and when optimized, can convert information on operations and management into data that can then influence key decision-making for the business leadership. With all of this in hand, the business’s CFO can:
For a small business, it can be challenging to hire a CFO and simultaneously arrange the business infrastructure required to support the CFO.
When a small business leverages an outsourced CFO, the advantage gained is that of an in-house resource empowered with the back-up systems of the outsourcing agency. Thus, the small business taps into a skilled resource while the outsourced CFO plays the critical role of bringing together the business operations to create a cohesive force that is focused on growth.
Furthermore, and more importantly, the outsourced CFO is experienced enough to analyze the business and outline the difference between what is needed to grow the company and how best to utilize existing resources, while simultaneously outlining what additional complementary resources are still required.
Because the outsourcing agency has the expertise and infrastructure already in place, the CFO services provide the added advantage of hitting the ground running. There is no longer the need for the CFO to learn about capabilities, such as driving and implementing strategies through data and analytics. They already are aware of the kind of data needed and the format in which it can be optimized, etc.
In General, Outsourcing Works Better
Outsourcing a CFO is a decision that can help small businesses in several other ways:
A Word of Caution
When choosing an outsourcing agency, make sure to look around, research well, and then make a decision as to who best fulfills your requirements. Also consider drafting Service Level Agreements, research the agency’s past history, and read client reviews, if available. These can provide validation around agency’s professional performance and how well they execute projects and assignments.
The team of professionals at Analytix Solutions has experience assisting small businesses move their companies forward with the help of customized financial and accounting solutions, including outsourced CFO services. For more information on how we can help your business, please contact us at [email protected] or 781-503-9000.Why a Small Business Should Outsource a CFO
A CFO’s role is that of a change agent who brings together the capabilities and resources of the business to ensure accountability in areas like performance, operations, etc. A second responsibility that rests with the CFO is that of the agent who brings together key data and information, including strategic plans with the help of analytics to empower leadership to make informed business decisions.
However, the CFO, when armed efficiently, can bring about significant positive change to a business’ bottom line. What does it mean to be armed efficiently? When businesses are in a position to utilize current technology, including analytics, the CFO can glean data on key operational and performance indices quickly enough to help decision-making.
Here are some of the ways in which a CFO can positively influence a business’ bottomline:
The CFO is uniquely positioned to be able to see operations, performance, income, and expense. As a result, there are three things a CFO can directly influence: reigning in the expenses or cutting down on costs, improving existing profitability, and changing or modifying strategy, including pricing for clients, etc. This is possible because the CFO has access to both, operational and management as well as financial data of the company. This information helps determine challenges better while also helping find solutions that work best, while optimizing available resources and without creating a huge outflow.
Improving Business Cash Flow
Cash flow denotes the amount of real cash the business has. The term cash flow stands for payment from one source to the other and describes the position of liquidity of a business better than even the accounts books.
Because the CFO literally oversees operations and expenses, she or he is uniquely placed to understand cash flow better and also help improve the business’ cash flow management. Practical concerns like improving collections of overdue money, planning ways to increase liquidity for the business, and strategic decisions such as modifying pricing after analyzing current conditions are all ways in which the CFO can improve the business cash flow.
Apart from analyzing cash flow, the CFO can review and assess productivity in all areas of the business, including staff and employees. If there is an issue faced in human resource productivity, it can be managed to improve efficiency and add value. Together with other information, such as figures contained in the financial reports and revenue and expense figures for the business, the CFO can decide on the next steps to be taken towards improving the business’ profitability.
The team of professionals at Analytix Solutions has experience assisting small businesses and start-ups move their companies forward. For more information on how we can help your business, please contact us at [email protected] or 781-503-9000.The CFO’s Role in Growing A Business’ Bottom Line
Digital tax workflows will be the norm more than the exception going forward. Businesses that do not capitalize on technology for their accounting risk becoming obsolete for potential clients, particularly those who conduct business primarily in the cloud or in a virtual set-up. Additionally, switching to digital accounting methods not only allows better alignment with clients’ systems, but also improves reliability and accuracy of accounts for businesses themselves.
Here are some challenges that small businesses encounter regularly in a manual tax workflow and which often prove to be difficult to overcome:
How Does Having A Digital Tax Flow Help The Above?
Here are some solutions to those challenges:
Automated Tax Processes
When applied to tax workflows, a digital tax workflow can help boost profitability greatly.
Here are some ways in which digital tax workflows help businesses:
Tax returns are manpower-intensive processes. When replaced with automated processes, manpower does not get redundant; it gets harnessed optimally, with the added advantage of reliability and accuracy of automation.
Automated processes allow businesses to handle greater workloads without having to deal with the hassle of hiring more people, training them on it, etc. A digital tax workflow thus helps manage higher volumes of tax filings with greater accuracy and time savings.
For CPA firms, this is especially meaningful. Tax time for a CPA firm often translates into a series of events that include calling clients with reminders to submit records, transferring data from paper receipts to electronic forms, reviewing forms to check entries, sending paperwork to clients, filing returns after complete, etc. All of these activities are part of the normal process of filing manually. A digital tax filing, on the other hand, streamlines the process, beginning with accurate records and ending with maintaining digital copies of the clients’ filings.
Supported by the accuracy of digital record-keeping, digital tax workflows minimize the uncertain elements of tax season, replacing them with accuracy and reliability. The result is hassle-free, streamlined tax returns.
At Analytix Solutions, we have been helping businesses, including startups, efficiently file their tax returns year after year. Our breadth and depth of experience helps us to better understand clients’ unique accounting requirements. We formulate customized solutions and incorporate industry best-practices. This allows business owners to address their challenges in a systematic manner, helping to streamline operations. For more information on our services or to find out more on our complementary assessment of your accounting procedures, visit us at www.analytixaccounting.com.Small Businesses Can Improve Profitability with a Digital Tax Workflow
When it comes to increasing efficiency in accounting, technology-driven audits have an advantage in the way they provide deeper insights into the data gathered. According to studies conducted by KPMG where controllers were surveyed, more than 70% of the total number interviewed felt that technology-driven audits provide insights that allow them to conduct a comparative analysis of company performances across their industries.
What Is a Financial Audit?
A financial audit is typically when a third-party examines the financial records, including various reports of an organization, to check for compliance. This may be for tax purposes or for other reasons, including the sale or purchase of a business.
Reliability of the data, as well as its accuracy, are checked during audits; thus making audits an event that is often approached with caution and some amount of trepidation.
However, it need not be so.
Technology Driven Financial Reporting
Technology is now driving businesses at almost every step, from client interaction to essentials such as accounting and bookkeeping. Digital finance is fast becoming the way payments are being made, and not just for e-commerce payment gateways, but also for essential functions such as tracking financial records for both expenses and sales.
Unlike manual report-writing and record-keeping, technology-driven reporting is more accurate and reliable.
Further, it is a myth that technology driven operations and reporting are meant only for the big businesses. A small and growing business needs it as much as an established business. Digital finance adds an element of convenience and reliability to financial transactions, thus making it essential for businesses of all sizes, including those that are growing fast.
Here are some clear benefits to implementing digital finance in a business:
Establishing a Clear Financial Trail
Programmed software allows businesses to track numbers automatically. Records are maintained; and receipts and invoices are tracked and stored, regardless of the transaction’s size. This creates a history that later assists in audits. In contrast, receipts and invoices may go missing in manual record keeping, creating gaps in the financial history.
Easing Out Collections
For growing businesses, it is easy to lose track of collections. Money owed, especially if the amounts are small, can quickly slip into the background, as larger transactions take precedence, consuming more attention and time. However, when added up, even smaller collections yield significant monetary amounts of money that can be then put to better use.
When utilized well, software also aids in collections by issuing reminders of amounts due, as well as facilitating payment through instruments like credit cards.
Building a Better Business Credit
Good credit history is established over time, with the aid of reliable financial reporting. If a business invests in technology-driven accounting and bookkeeping, this facilitates more reliable reporting through simple but critical actions such as ensuring payments are made on time, thus effectively managing debt without allowing it to become overdue at any point.
Business credit is also built through better regulatory compliance, again aided greatly through implementing technology-driven accounting and bookkeeping practices.
Orderly finances, consistent reporting, accurate data, and access to real-time information are some additional ways in which a technology-driven financial system works. Each of these in turn assists in financial audits by creating a more reliable environment that which saves time for everyone involved.
One of the side-benefits of having streamlined operations is that owners can eventually focus on business growth and expansion.
If you are a small business owner and you have not yet invested in technology-driven options, reach out to professionals who can help your business. At Analytix Solutions, we work closely with clients to customize technology to their business needs. Call us at 781.503.9002 or email us [email protected] to learn more about how our scalable solutions could help you and your business.Role of Technology-Driven Reporting in Financial Audits
Avoiding hotel accounting and bookkeeping errors is as much a function of practicing diligence and consistency as it is about competent, even-keeled staff managing it. While no business can claim to have 100% error-free accounting, working to prevent errors from happening is critical. It is also more cost-effective to prevent mistakes from happening in the first place, rather than correcting them later.
Having competent staff to manage your hotel accounting and bookkeeping is crucial because client service is a vital element across all functions of the hotel business. Any accounting mistake that involves a customer may take longer to resolve than one that does not. The chances of errors increase directly, given the high volumes of reservations, cancellations, food, and beverage requests generated directly from guests. If the hotel staff is not competent enough, even technical matters could escalate, eventually influencing the business negatively and causing loss in terms of finances and reputation.
Ensure Staff Is on the Same Page
Training staff in technical matters related to accounting and bookkeeping and providing them consistent support is one way to ensure relatively error-free accounting and bookkeeping for a hotel business. However, both of these can get demanding for a business poised for growth, especially when most in-house resources are focused on that growth and nothing else. Setting aside even a minuscule proportion of time or resources for training purposes may prove to be difficult for a business that is rapidly growing. This is especially true for accounting and bookkeeping, where daily tasks cannot afford to be overlooked.
What are the different ways in which to avoid hotel accounting and bookkeeping errors?
Ensuring consistency is easier when the basics are followed. As a first step, ensuring paperwork is complete, entries are recorded consistently, and categorization of income and expenses is carried out correctly, can boost chances of error-free accounting.
There are tasks within accounting and bookkeeping that must be performed regularly or on a daily basis. Other tasks, such as creating new vendor lists, statement reconciliation, inventories for hotel supplies food and beverage merchandise, are critical functions that can help the accounting function to operate smoothly but do not need to be performed daily.
Following a budget is a useful way of ensuring that the hotel’s operating expenses are reduced. A budget also restricts overspending and helps staff align with financial goals and ground realities. More importantly, creating a budget allows everybody involved to understand the financial limitations of the business and help realize long-term goals and short-term objectives. Needless to say, budgeting is also a part of classic accounting practices that should not be overlooked.
Bookkeeping is all about recording transactions correctly. Data entry is a big part of bookkeeping and includes essentials such as bank reconciliations and reconciliations between accounts payable and receivable. This means tracking vendor and customer invoices and receipts.
Data entry is a function prone to errors and must be reviewed periodically to make corrections in the numbers and ensure accurate records for all transactions.
Back-ups are non-negotiable to avoid errors in hotel accounting and bookkeeping. However, backed-up data needs further attention and should be checked for errors and potential corrections, as well. Discovering errors during times when there is trouble may render the back-ups useless, compounding the challenge faced by the business in times of crisis.
Time is of essence for the owner of a growing business. Outsourcing critical tasks, such as statement reconciliations and tax filing can help a business ensure accuracy and reliability in financial records. Outsourcing to professional accountants can also help hotel businesses save money in terms of ensuring applicable tax exemptions and higher regulatory compliance, in addition to benefiting from money saved in working with error-free records.
For the owner of the business, there is the added advantage of investing the time thus freed up to pursue business building activities.
Looking for Help? Do Not Miss This
If you are looking for help with a growing hotel business, remember that accounting services are best carried out by professionals. Look around for an outsourcing provider who can work alongside you to serve your business goals better and to work with you to help enhance profitability. There is no “one-shoe-fits-all” formula. Depending on the business size and hotel property type, geographical location, and services provided, an outsourcing vendor should be able to design and customize effective solutions
Analytix Solutions is a single source provider of business solutions to startups and small to mid-size businesses that are positioned for growth. Call us at 781.503.9002 or email us [email protected] to learn more about how our customized and scalable solutions, including Insight360 solutions designed for hotels, can help your business manage challenges better.5 Ways to Avoid Hotel Accounting & Bookkeeping Errors
Accounting needs for hotels differ from general business accounting in a few ways, mostly dictated by the fact that guest satisfaction forms a huge part of hotel operations. Almost every aspect of a hotel business has an element of client interaction woven into it. Whether it is about managing accommodations, food and beverages, or housekeeping supplies, each of these categories influences the guest experience.
As a business function, accounting and bookkeeping are essential to a hotel business and mistakes in recording transactions, income, expenses etc. can result in a loss in revenue as well as a negative guest experience.
The competence of staff and a thorough understanding of the system on the part of the employees managing accounting are critical to ensure consistently positive experiences and returning business.
What Constitutes Hotel Accounting and Bookkeeping Mistakes?
Errors could occur in various categories, for example, in recording income and expense. Some of these can directly affect the finances of the business, influencing the amount of cash available for expenses, eventually leading to problems even in day-to-day operations. Operations like management of cash flow and accounts receivables and payables are a result of diligent accounting and bookkeeping.
Mistakes in accounting and bookkeeping could be as small as forgetting to record a transaction or as big as missing out on recording critical entries for smooth tax filings. In reality, there is little room for errors, big or small, in accounting and bookkeeping.
Forgetting to record a transaction can quickly snowball into overdue payments, while mistakes in tax filings could affect business sustainability.
Both are situations that can be avoided with judicious planning.
Below is a list of a few hotel accounting and bookkeeping mistakes that should be avoided.
Mistake #1 – Not Planning for Unforeseen Events
Disasters can be entirely unforeseen, catching a business unaware and leading to crisis situations that can affect the business stability. Apart from events like a hurricane or an earthquake, disasters may include:
The mistake lies in not planning for such events and failing to create adequate backups. Backups are a critical component of hotel accounting for everything from managing payments for accommodations to inventory for food and beverages and housekeeping supplies. While backups may not be 100 percent foolproof for resources, at least key areas of responsibility and work status can be shared so that it can be picked up by others without harming business sustainability.
Mistake #2 – Neglecting Everyday Bookkeeping Tasks
Are all hotel transactions being recorded without fail? What about statement reconciliations? Are inventories being tracked, together with variations in merchandise prices, etc.?
Each of these tasks are directly connected with cash and finances in a business and if neglected, can provide business owners with an erroneous picture of the health of the business. Not only does this affect buying decisions, it can also hamper critical investment decisions for the business. In a hotel business, this is compounded by the variations possible across categories: room rates, food and beverage varieties, staff holidays and off-days, etc.
Mistake #3 – Not Thinking Through to Tax Deductions
Failing to preserve receipts for smaller amounts, or not deducting sales tax, or not recording transactions diligently, can affect a business when it comes to tax filing time. Tax deduction claims vary according to the nature of the business and missing out on certain exemptions can negatively impact a business at tax time. Also, practices such as missing out on deducting sales tax on transactions could result in an inflated figure of tomtal sales, thus increasing the amount of tax due.
Mistake #4 – Improper Categorizing
Categorizing is basic to bookkeeping and accounting; however, it is possible to get this wrong, resulting in errors when measuring profitability as well as losing out on tax savings. Mistakes can happen when categories such as income and expense get switched or when entries are made incorrectly.
In hotels, the categories can increase, given the variations as discussed in a previous section: varying room rates and rentals, price variations across package deals, and deals with and without food and beverages, housekeeping expenses, other guest requests, etc. Improper entries in these ledgers and categories can result in mistakes in accounting figures, cascading into financial losses for the business.
Mistake #5 – Inability of Software Systems to Adapt to Growing Needs
Accounting software systems can take care of critical bookkeeping and accounting tasks for a business. However, if it is unable to keep up with expansion, or manage work situations where the hotel experiences heavy sales or a period of sudden growth, it can result in an accounting backlog and reason enough to be considered as a mistake. The system then fails to carry out bookkeeping and accounting tasks, resulting in figures that may be inaccurate and unreliable, in addition to a huge gap in numbers owing to lapsed records. Sometimes, this may not be discovered until it is too late and nearly impossible to resolve.
Finding Solutions to Manage Hotel Accounting Challenges Better
Given the nature of accounting services, it is imperative that a business invests in solutions that are tried and tested. Solutions that are effective will help in several ways:
Choosing Solutions for Productivity and Profitability
At Analytix Solutions, we have been helping businesses, including startups across diverse industries, for scores of years now. Our depth of experience has helped us understand requirements better, creating customized solutions and also coming up with industry best-practices. This allows business owners to address their challenges in a systematic manner, helping the process of streamlining operations faster and rapidly.
Insight360 by Analytix is one of the solutions we offer our clients who are involved in hotel businesses. It is a proven provider of accounting solutions. It complements existing capabilities of a hotel to take operations to a higher level, one where growth and expansion of the hotel business are complemented by consistency in quality and adherence to high service standards. This immediately results in more reliable finances while owners can focus on critical business issues, such as customer service and business development.
Analytix Solutions is a single source provider of business solutions to startups and small to mid-size businesses that are positioned for growth. Call us at 781.503.9002 or email us [email protected] to learn more about how our customized and scalable solutions can help your business manage challenges better.Managing Mistakes In Hotel Accounting and Bookkeeping
Accounting systems integration can help accounting software perform optimally such that firm operations are streamlined to increase efficiency and profitability.
Here are a few ways in which accounting systems integrations can help CPA firms prepare tax returns better and more effectively by taking over detail-oriented tasks, freeing up firm resources and professionals for the more critical tax filing functions.
Comprehensive reporting capabilities:
Accounting systems integration makes for comprehensive reports. This allows better access to critical information that can help business decision making and improved operations for the business.
Comprehensive reporting is essential for tax time too because it helps create an audit trail that leads to data sources directly, saving up on essential time.
Reduced data entry:
Accounting systems integration can allow for organized and seamless data entry, helping carry out everyday functions faster and in a more reliable manner.
Easier data transfer for tax purpose:
Depending on how you program systems, accounting system integration can allow you to utilize your financial data in tax forms directly. This is a highly useful accounting function especially when combined with information like financial statements, payroll documents, and compliance, etc.
Better reporting for clients:
Accounting systems integration can help provide dependable reports which can then be posted by CPA firms for easier access by clients.
Invoicing and collections:
Managing accounts receivables becomes easier when clients receive invoices on time and also receive help in the form of payments collected through credit cards by the system.
Analytix Solutions provides scalable comprehensive and professional tax filing services that are customized to our clients’ needs. If you are looking for help at tax time, or would just like to know more about our work, call us at 781.503.9002 or email us [email protected].Accounting Systems Integration: Helping CPA Firms Prepare Tax Returns
Tax time can be all-consuming, in terms of time and attention, when it comes to business accounting and bookkeeping. This is true even for CPA firms that perform accounting and bookkeeping functions for their clients.
Ironically, this is one of the compelling reasons that a CPA firm can use outsourcing help: to ease pressure they face in terms of their own client deliverables and to access expertise and reliability in accounting for themselves and the sake of their business.
How can outsourcing help CPA firms to file taxes easily? Given below are some examples:
Freedom from constant worry: Tax time can be a potentially fatiguing time. Add to this the tax filing responsibility for the numerous clients a CPA firm caters to. On the other hand, outsourcing is work carried out by professionals focused on it alone. This is unlike a CPA firm owner who is likely to be multi-tasking between tax filing for clients alongside that of his or her own firm. The professional at the outsourced firm is not distracted by anything else, and the result is error-free tax preparation and filing.
Expertise backed by infrastructure: Sound infrastructure can help cut errors as well as time taken to complete work, including tax filing. Outsourcing firms have already invested in reliable infrastructure to ensure accounting and bookkeeping requirements for their clients are executed even within higher volumes. For a CPA firm, investing in infrastructure can prove to be a costly proposition, especially if it is a growing business. Outsourcing allows the CPA firm to tap into this established set-up successfully.
Experienced manpower: Because outsourcing firms have a commitment to their own clients, they are staffed by professionals and skilled manpower. For a small to mid-sized business, even one that is growing rapidly, investing in skilled manpower can prove to be costly. Outsourcing allows a CPA firm to tap into expertise minus the expense or hassle of recruiting. Further, it means that the CPA firm’s own resources are free to focus on their own business.
Freedom from temp staffing worries: Some CPA firms hire temp staff to help them tide over tax time. This is challenging from two perspectives: it is difficult to ensure that the right person is hired for the job, and once hired, retaining them can be challenging, especially since it is clearly a temp position. Outsourcing removes this factor altogether, also adding an element of professionalism and expertise to what might otherwise be a temp job.
Faster, cost-effective, quality work: Outsourcing firms, because of their professional staff and typically current infrastructure, deliver better work faster. Moreover, outsourcing proves to be more cost-effective than an in-house set-up.
At Analytix, we have been providing small to mid-sized businesses with accounting and bookkeeping expertise for more than ten years now. Businesses who are positioned for growth turn to Analytix Solutions for scalable, single source, business solutions. We also provide a full range of business services, ranging from Accounting, IT and Data Management to AV Solutions.Harnessing Help: Outsourcing Can Enable CPA Firms To File Taxes Easily
Accounting and bookkeeping are core, critical functions for any business, regardless of the industry. They are also time-intensive functions that require attention to detail if the results are to be dependable. Most of the time, however, the accounting and bookkeeping is taken care of by the founders or owners of the hotel. This practice may work for a startup, but as soon as the business starts to grow or enters a growth phase, it generates higher volumes of transactions that need diligent accounting and bookkeeping practices.
When the hotel owner chooses to get involved in accounting, it can virtually eat into the time and attention needed to ensure high quality customer service and business development activities.
A hotel accounting provider can prove to be very useful at these times.
What Areas Can an Accounting Provider Help With?
Customer service is key to a hotel experience, and the quality of customer service significantly impacts repeat business.
Also referred to as “guest experience”, customer service in the hotel industry can include accommodations, food and beverages, housekeeping, responsiveness of the hotel staff to customer requests, and management of bills or the billing system, etc.
Each of these areas has an accounting and bookkeeping element in the form of vendor transactions that generate invoices and bills that need to be paid. The accounting company will need to manage all of them simultaneously, so it is important to select the partnering accounting company carefully.
Listed below are some questions that can help in selecting an accounting services provider:
Ideally, an accounting services provider can assist with reporting on all of the aspects listed above, streamlining tasks to leave the owner free to pursue business development activities, including managing customer service.
Streamline Daily Operations
A hotel accounting provider should offer tools and apps that enhance reporting on daily operations, including routine ones. This helps ensure critical operations are taken care of automatically.
Accounting and bookkeeping are essential functions for any business, but especially for the hotel industry where transactions can become complex due to various room charges, extended stays, etc. Streamlined accounting systems contribute to having confidence in the accuracy of financial records, thus providing hotel management with the confidence they need in the data to make critical business decisions under tight timelines.
Implementing a robust reporting system can help hotel management easily access data from across various operational areas, including room occupancy, room rates and costs, and employee metrics.
Hotel accounting solutions should help management assess and compare performance across the hotel easily. This includes hotel properties in multiple geographical areas, as well.
Before Finalizing the Contract
The right hotel accounting provider should be able to lighten the operational load for hotel management, leaving them free to address functions such as business development and customer service.
Thorough research must be conducted before finalizing the hotel accounting provider, while the hotel’s requirements must also align with the services that the provider offers.
A well-established hotel accounting provider can deliver the following:
Have you ever hired a hotel accounting services provider? What are the capabilities you would look for? Please comment, and let us know.
At Analytix, we are passionate about customizing solutions to meet the business needs and requirements of our clients. We have helped scores of businesses find reliable hotel accounting solutions, drawing upon our own expertise and experience. Interested in knowing more? Drop us an email at [email protected] or call us on 781.503.9002, and we will get in touch with you.Choosing a Provider for Your Hotel Accounting Services? Consider These Things First
CPA firms in a growth phase face numerous challenges such as new business development, service line expansion, manpower shortages, and infrastructure scalability. Although growth is exciting, it can be fraught with trials, including budget constraints.
One solution for addressing many of these challenges is identifying a strategic partner who can provide assistance with these issues. The right partnership can be an invaluable asset to a CPA firm.
The Potential of Business Partnerships
When executed correctly, a business partnership for your CPA firm can help you focus on business development and revenue generating activities while simultaneously assisting with your firm’s client commitments.
What Do You Need From The Partnership?
Before finalizing a business partnership for your CPA firm, here are a few things to consider:
Can a potential partner provide your business with critical support when needed and do they possess the expertise that your firm could leverage effectively? Research the partner’s capabilities, service offerings, expertise and experience within the industry your firm operates, the partnership should enable your firm to:
Partnerships require information sharing, so prior to finalizing any agreements evaluate how information will be shared. Tools such as reliable dashboards or interactive platforms that provide access to clients’ data and electronic document sharing can be beneficial. Also assess their reporting capabilities and the ways in which they streamline data, including clients’ information.
A partner with a robust infrastructure can help you stay on top of your clients’ data at all times, ensuring trust and transparency.
Some partners will offer the option of private labeling engagements where your logo will be placed on all client deliverables you obtain from your partner. There are other partnership engagement models as well, so decide with your partner which is the best option. In a collaborative engagement model, you remain your clients’ point of contact, but your client is aware of the partnership and how you are leveraging specific expertise and services from the partner.
In a direct client engagement, your partner works directly with your clients while you consult from time to time, ensuring that the arrangement remains in sync with your clients’ expectations.
It is likely that if your potential partner can provide the capabilities outlined above, then they have an established client base who can could benefit from your capabilities. As a CPA firm, you bring accounting expertise to the partnership which they could pass on to their clients.
Similarly, you save on the time, costs, and efforts associated with pursuing new business development. The hassle associated with bringing in new business can also eat away at your peace of mind as a business owner. Your partners’ list of established clients should help you bypass this effort.
Data security will cover all aspects of data sharing and information access within the partnership. This includes clients’ information, as well.
What is the level of data security offered in the partnership? Are there any standards established? What about industry-specific compliance requirements? Factors such as authorized access and ISO standards matter and can help you decide whether or not to finalize a partnership.
Choose Professionals for Partnerships
Analytix Solutions has strategically helped to guide small businesses across diverse industries in managing their financial functions. Our experience spans more than a decade, and we have developed customized solutions for CPA firms, CFOs, accounting firms, etc. Our solutions have helped firms gain a competitive advantage in their target markets.
Having a strategic business plan in place is important for a business focusing on long-term goals, including growth and expansion. However, it is not uncommon for business owners to get caught up in everyday operations, including firefighting, and lose sight of the long-term vision. Fortunately, a strategic business plan can help guide a company through changing priorities and circumstances to emerge successful and profitable.
There is no single way of creating a business plan; it varies depending on the business and the industry the business operates in. Some strategic business plans also contain company description and details of what the business plans to deliver in the form of services or goods in great detail. In some cases, competitor information and market analyses are also included, alongside information on how operations and executions may be planned. A strategic business plan will thus be a customized document.
There are however, some key components to every business plan:
The vision statement covers the chief elements of the business endeavor. It will encompass the present as well as the future of the business.
The mission statement needs to cover the philosophy of the business while expressing its purpose and the resolve to meet this purpose. In doing so, the mission statement also embodies the values of the business.
Putting down the company’s values in a written form helps employees understand their deliverables better. Apart from holding the business through difficult times, a value set outlined in a strategic business plan has several other uses:
Goals and Objectives:
Goals and objectives bring into focus the short and long-term goals for the business. This section also outlines timelines and efforts towards meeting these. The goals and objectives will usually take into account the vision and mission statements, helping employees work together in a coordinated manner.
Identifying critical elements such as Strength, Weaknesses, Opportunities, and Threats (SWOT analysis) can help create realistic goals. Strategic goal-setting can also follow the SMART analysis, an acronym for Specific, Measurable, Agreed Upon, Realistic, Time-Based strategic goals.
Setting goals and objectives helps businesses set down a framework to face and address growth plans, including unexpected challenges. Goal setting can help in moments of crisis, helping employees adapt to change without affecting the long-term growth goals.
This section provides clarity on how goals and objectives will be achieved. The execution is decided-upon through brainstorming and free discussions from people within the business to reach on agreed-upon outcomes for strategic objectives. More importantly, when more people from the business are involved in creating strategies for goal execution, it creates an environment conducive to buy-in.
Execution plans propel goals and plans forward. They outline accountability while providing employees with a sense of inclusion and belonging.
Analytix Solutions has helped many businesses perform better through insightful planning and strategic goal setting. If you would like to learn more about creating a strategic business plan, please email us at [email protected] or call us at 781.503.9002.Key Components of a Strategic Business Plan
Profits and cash are often found to be used interchangeably, although they denote different components within a business.
Profit denotes the financial gain, or amount of money a business has left over, after all expenses incurred in operations have been paid. If a business earns amount x in revenue for a project and also spends all of it towards expenses incurred in executing that project, there is zero financial gain.
In contrast, cash is a term used to denote money that is liquid, or available for immediate use. Any financial gain left over after paying up all expenses, and which can translate into money available for immediate use can be termed cash.
Profit is a term that lends itself easily to misunderstandings. Having made a profit may not necessarily indicate a ready reserve of cash. Profits may still remain locked in terms of unpaid invoices, payment dues not yet cleared by customers or money owed to the business but not yet paid. As a result, a successful sale or completion of a project may show up in the business books as profit, but if the customer has not paid for the past three months, the profit does not translate into cash or financial gain, even as expenses on the account continue, in case it is an ongoing project.
The Critical Points Of Difference
Probably the single biggest differentiator in this case would be: Cash is an ingredient essential to business formation. Profit comes in after this; cash is used to first set up the business operations, lease or buy premises, hire people, and pursue project executions to earn revenue. If the revenue earned covers the operational expenses and yet leaves the business with some cash, then a profit has been made.
Here are some points to illustrate the difference between these two terms better:
Confusion Between Profit And Cash
When talking in terms of business, the terms ‘profit’ and ‘cash’ are often used interchangeably. The implication probably being that profits translate into cash, eventually. But this should not be taken to mean that cash components are the more important of the two. If cash is a short-term necessity, profit is a long-term goal for business sustainability.
By definition, if there is no profit being made over a period of time, the cash will eventually dwindle. Without an inflow of cash, investments into the business dwindle as well, and the business may finally collapse. Conversely, pursuing profit alone may not be able to catapult a business onto a higher place on the growth curve. When a business pursues profit, cash is required in equal measures to sustain it in the form of more investment of say, premises, equipment and infrastructure, skilled staff, etc.
Ensuring A Balance
Consistent profits are the first step to business growth as cash reserves grow and there is more money to invest back into the business.
There are several ways to ensure a balance is achieved between profit and cash:
At Analytix, we help our clients from diverse industries explore different ways of streamlining operations so that profitability increases and cash flow is managed better. If you would like to learn more about creating stronger cash flow, please email us at [email protected] or call us at 781.503.9002.The Deal About Profits: Difference Between Profit and Cash
For any business to succeed and expand, it needs a solid client base. Business expansion is critical for growth, but pursuing new business and securing new clients is a cause of apprehension for most growing businesses. Logically, it follows that if you fulfill a client’s needs and if you provide high quality service, then client retention and acquisition efforts should be successful.
However, this is not as easy as it sounds. For example, a business may provide high quality work, but if a client’s needs do not align with the services provided, a client may not return. Additionally, even if a business retains a significant number of clients, new clients are still needed to sustain business and increase profitability.
Options to Tackle Expansion Challenges
Partnerships can provide opportunities to ensure that business expands for CPA firms. Following are several examples of how partnerships can foster this:
What Should You Look For In A Partner?
When evaluating characteristics to engage in a strategic partnership, look for a company which can mutually benefit from the relationship:
A Word of Caution
Enter into partnerships after carefully evaluating the relationship. Look around, research and carry out meetings with several potential businesses before you consider entering into a signed agreement. Assess their levels of expertise, areas of operation and years of experience, infrastructure capabilities, manpower resource, and support services. Once you have reviewed these core areas, discuss financial arrangements and non-compete clauses. After a thorough evaluation, consider signing an agreement.
The team of professionals at Analytix Solutions has expertise to help strategically guide small business in managing financial functions, including accounting and bookkeeping services. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help your business forward, please call us today at 781.503.9002 or email us [email protected].How Can Local CPA Firms Expand Business?
Accounting and bookkeeping are critical functions if you are running a business. They are as important for a startup as for an established business, looking at high growth. Whether it is about ensuring profitability, making decisions that include investments for the business in terms of space and infrastructure, or simply sustaining the business, accounting and bookkeeping are functions that cannot be pushed back, with the business owner multi-tasking as the accountant and bookkeeper. If you do so, you are already creating a disadvantage for your business.
Consider the following chain of events:
For a growing business, failing to keep a record of transactions can lead to several serious consequences:
Following is a list of five important accounting tasks that can help you ensure accurate accounts for your business:
File, record, and maintain receipts. If this is not done on an everyday business, you will probably start doing it once you conduct a weekly check for your business’s transactions. Put into place a system whereby no transaction is completed without a record being made of it. This way, at the end of the week, when you sit down to document it all, you will not be overwhelmed.
Check all the bills left unpaid over the week, including small transactions and large ones. If you have invoices to compare, that is the best. Why is this a weekly task? Because any more gap between transactions and recording, and you are likely to forget all about it, leading to missed records. When you have no record of a transaction, you are liable to lose money as through paying more than what you really owe.
Once you finish assessing payments due, make sure you finish making payments for invoices that are due or overdue. Remember, some vendors have a late payment charge attached to their services. Conversely, some vendors incentivise early payment with discounts or other perks such as a free service offer, etc.
There is software available online that allows you to keep track of your Accounts Payable. Once you install it, you will receive reminders for payment, allowing you to stay on top of your payments.
Your business’s cash flow is what tells you how much liquid cash your business has. You can choose to install software that manages cash flow and helps you keep track of it, or you can create your own cash flow forecast using an Excel sheet.
Knowing your cash flow at all times helps you make critical purchase and business investment decisions without wasting any time or effort.
Ensure your invoices are sent out on time. Not all your customers will make their payments on time, but you need to ensure the delay is not from your side. Weekly reviews will help you determine whether your invoices are ready, being sent on time or not. Late invoicing means late payments. Accounting software can help you with this as well, by helping generate invoices on time and even allowing customers to make payments to you directly.
The Importance of The Weekly Review
If you noticed, there is a software available for almost every function listed here that you must include in your weekly review.
However, despite software being freely available, and also coming with its own set of instruction, software will still need a certain level of expertise to be managed optimally.
Ensure you have resources who can help you set up the software, work it, and also troubleshoot as and when required.
If you still feel constrained, you can also hire professionals to take over critical business accounting tasks. When you hire professionals, you save yourself the hassle of setting up systems, putting into place a schedule of reviewing, or even hiring trained personnel to carry out these tasks. Instead, the entire responsibility gets taken care of by the agency you hire.
However, look around a bit and conduct your research before you commit to outsourcing your work. Check out capabilities of the agency/provider and find out the scope of their services offered in detail before signing on the dotted line. The right professional accounting services provider will not just help you with a weekly job list, they will help you streamline your business operations, putting your business on the growth track.
Five Important Accounting Tasks You Should Do Each Week
What do you think should be included in the list of weekly important accounting tasks? Do share with us, we would love to listen your list of important accounting tasks.
Professional accounting services may sound like a technical term straight out of a textbook, but it is in fact something that every growing business can use successfully, and more importantly, profitably.
Profitability is of great significance to any business. However, income earned does not automatically equal profitability for the business. Why? Because income earned must go into first paying the bills that fuel the business in the first place. Accounting essentials, such as cash flow, determine how profitable a business is. If so, how do you get to make a business profitable? Good accounting and diligent bookkeeping can put your business on the track to profitability.
A professional provider of accounting services can help your business achieve this.
What Should I Expect?
If you’re looking at hiring a professional accounting services provider, there are several things to keep in mind:
When you choose to outsource to professionals, you get solutions from professionals dedicated to providing reliable services. Because of this, once hired, they take over accounting, including bookkeeping basics so that no transaction goes unnoticed. Every sale and invoice is recorded and your accounting books, at any given time, will be up-to-date.
One of the major benefits here is that you will no longer need to keep reviewing what they do. You can trust them to do a thorough job. Keep in mind that even if you’re an accounting services professional yourself with years of accounting experience, your primary role is that of business owner. You are responsible for your business’s growth as well as sustainability. Unless you allow them to take over their area of expertise, you’re not getting your money’s worth.
How often have you wondered if the numbers your business balance sheet holds are accurate and reliable? If your answer is yes, you need to get professionals to help you out. Bookkeeping needs to be carried out every day to ensure you do not miss out on vital transactions. A professional ensures this because it is their job to. If you are handling your own bookkeeping and accounting alongside running the business, you may not be safe from errors entirely as you juggle between different responsibilities, including bringing in new business.
Accounting is a core service. If you’re multitasking at accounting and business development, one of them is bound to suffer. Even if you have someone else dedicated to the function, there are still chances of error or omissions. When you reach out to professional services, what you gain is more of accounting solutions and thorough execution of bookkeeping tasks. No essential function is left out nor done in a haphazard manner. Instead, you get accurate numbers and clean, ready books and a tax-ready business as well.
What is your business structure? What are the taxes you pay? Is your business structure and tax amount matched? A professional accountant is well versed in these areas. Not only will your business save money through payment of correct taxes, but your finances will be more streamlined as well. Well-organized finances are of great significance in the event of transactions, such as business take-overs or sale. Even if you need a loan, you need to show organized finances for its approval. A professional can help ensure this. When you have ready, organized accounts, you can take critical business decisions instantly, without wasting time. Some business decisions that need well-maintained accounts include partnerships, joint ventures, or even buy-outs.
Professional accounting services providers help your business save on money. This is because they have their own infrastructure and resources already set up. If you are thinking of an in-house set-up, remember, hiring an accountant can be expensive; they’re skilled resources after all. Managing and maintaining accounting infrastructure, including software, can also stretch your business’s budget. But if you hire one, a good provider should be able to execute all your business requirements on their own dedicated infrastructure while assuring accurate accounting for your business. Just be sure to look around before you make a final decision on a service provider. Do not be in a hurry to sign on a provider; you might just get less value for your money and a contract which binds you to their services.
Factors like transparency while working also count. Features such as cloud-based accounting can prove to be of immense help if your company interacts over the cloud. A cloud-based portal can help simplify data collection, both financial and operational, while helping you with ready reports on business functions. Look around for a provider who can provide you with advanced options in utilizing cloud technology while providing you with transparency and ease of access. A working arrangement that includes technological help cuts down on time, allowing business owners to make informed decisions without having to wait for someone to come up with the relevant data, draw reports, etc.
So, What is Your Take On It?
As a business owner, have you experienced periods of activity where you wished you had an expert professional to help you out? Have you felt the pinch of time as you go about pursuing new business while keeping an eye out for bookkeeping transactions that have missed being recorded? Share your experiences with us. We are waiting to hear from you.
The team of professionals at Analytix Solutions has professional expertise to help strategically guide small business in managing financial functions, including accounting and bookkeeping services. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help your business forward, please call us today at 781.503.9002 or email us [email protected].Professional Accounting Services: What Businesses Should Expect
Accounting functions are the backbone of any business. If you thought you could start a business and continue carrying out accounting work by yourself, you might be badly mistaken. As a business takes off, it may go through phases of high performance and low performance. However, accounting and bookkeeping will be connected to it from the time you begin the first transaction for the business.
Bookkeeping is a basic function, keeping track of each and every transaction that takes place in the business, whether with clients or with suppliers and vendors. This means, recording not just sales and purchases of products and services or money owed, but also invoices, unpaid bills and money that is to be paid out by the business.
So Why Not Just Hire an Accountant?
Hiring an accountant should be on every business’s to-do list. An accountant will track the finances of the business, as outlined above, and also conduct essential core functions, such as carrying out tax work and putting together the business’s financial report.
Accountants are a skilled resource and can prove to be an expensive hire. This is also the reason why many new businesses choose to carry out their accounting and bookkeeping by themselves. But as a business starts growing, there is a high chance of missing out on recording of transactions, eventually affecting year-end tax calculations.
How About an Accounting Department?
An accounting department will not only take care of accounting services and requirements, but also ensure that your business stays profitable while continuing to grow. But here is the problem:
Setting up an accounting department can prove to be intensive in terms of expenses: accounting professionals are expensive to hire and accounting software, should you choose to invest in it, is also an expensive purchase.
Instead, you can choose to let your business’s accounting be handled entirely by professionals in an outsourcing arrangement. Consider the following:
There are other benefits to choosing accounting services:
A Last Word
As an owner of a fast-growing small business, you may have started your company with a vision of building something big. If you are caught up with the basics and core, essential elements, you may not have the time to continue your pursuit of your dream.
When you choose accounting services, you also choose to pursue your original plan of business building with greater clarity and peace of mind even as your accounting is take care of.
The team of professionals at Analytix Solutions has expertise to help strategically guide small businesses in managing financial functions, including accounting and bookkeeping services. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help your business forward, please call us today at 781.503.9002 or email us [email protected].
These are our views. We’re interested in knowing about you. How do you manage your business’s accounting? Please share your experiences with us. We’re waiting to hear from you!Accountant or Accounting Services: What to Choose?
As an entrepreneur, you are probably busy chasing business development initiatives and bringing in more revenue. How then, do you manage essential tasks like accounting and bookkeeping, which are often time-consuming and detail oriented? If you do them yourself, these tasks eat into a lot of your workday whereas, as a business owner, your time is needed to move the business ahead.
But tasks like accounting and bookkeeping are a core function in any business and cannot be neglected either because the neglect will quickly lead to poor financial health of the business. Poor financial health can lead to critical business decisions being delayed, in turn affecting future growth.
One of the solutions could include asking for help. You need to look for a balance where your business’ core tasks get taken care of, while you, as the founder, are free to add more revenue to the system. Outsourcing your accounting functions to professionals who provide these services can help you in more ways than one.
How can you ensure you gain all the benefits of outsourcing? We have shared some tips here which can help you make a favorable decision:
Hire Someone to Do Your Business Bookkeeping
Choose a few critical accounting operations to be outsourced. Daily bookkeeping is one such area. Recording each and every transaction is a time-consuming task and prone to errors as well. Since business owners often multi-task, it can leave them with little or no time to pursue other critical activities. The end result may not always be totally reliable either.
However, a professional carrying it out would greatly reduce the chances of error while also adding speed to the entire exercise.
Optimize Outsourcing Expenses
Outsourcing your accounting functions services is far less expensive than managing your own set-up for accounting. Skilled accounting expertise is expensive, whereas providers of outsourced services will get you all the benefits of an in-house department minus the hassles. You may need to look around before finalizing a vendor, but you will get to choose someone who can provide you with a professional bookkeeper, infrastructure including software, as well as meet your requirements for security, data backup, etc.
Explore the Options of Scalability
Not only is outsourcing reasonable for a startup and a business that is on a budget. Some providers of outsourced accounting services will allow you to save on money by scaling back on operations when not needed. You can look around a bit to find one who provides you with the business options you need within the timelines you require.
Get Results, Error-free
Because bookkeeping is a numbers-intense task, your chances of error increase vastly if you do it alongside other work. Instead, hiring a professional cuts down on the errors while increasing the reliability of the books
A bookkeeper knows what is to be done, according to tax timelines, etc. When you outsource bookkeeping to a professional CPA firm or provider of outsourced accounting services, what you get is work that is reliable and can be utilized as and when needed on an immediate basis.
Further, having professional bookkeeping also translates into better control over your expenses, thus ensuring better financial health for the business.
The team of professionals at Analytix Solutions has expertise to help strategically guide small businesses in managing financial functions, including accounting and bookkeeping. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help your business forward, please call us today at 781.503.9002 or email us [email protected].How Can Outsourced Accounting Services Help My Business?
You possess the expertise and the know-how required to meet your clients’ expectations. You also recognize the importance of timeliness to your client.
However, what about the growth of your own business in the meantime? Focusing on client needs often means that you put aside the needs of your own business.
Going about daily operations and servicing your clients allows you with little time to focus on the following:
Often, for small businesses or startups, these challenges are interconnected. A tight budget can affect business investment in resources; lack of adequate resources may lead to the inability to meet clients’ complete needs, in turn affecting client retention.
If we begin with the budget, even if you are a professional CPA, you may not have the necessary bandwidth to devote time to your business’s financials or to draw up a realistic budget.
This can be compounded by the demands on your own time as a business owner, where you need to meet client requirements first and foremost. How then do you ensure your business financials remain in top form? Consider outsourcing the related functions to a CPA firm or other accounting related service company.
Why You Should Consider Outsourcing Help From a CPA Firm to Help Your Business
A professional CPA firm immediately brings the following benefits to your business:
As a business owner, you would need to devote a huge amount of your time to each of these, should you decide to manage them yourself. This will then eat into the time needed for activities such as business building.Leveraging Your CPA Firm to Provide Your Business with a Competitive Edge
Most small businesses follow a budget. This budget decides business investments, purchases, hiring of resources, expenses on infrastructure, etc.
However, if you are a business owner yourself, you know that it is some of the basic and back-end functions that often need the most investment. Bookkeeping and accounting are two such essential functions that need time and attention from the business owner.
What is bookkeeping?
The function of recording transactions that include the exchange of money, such as purchases and sales, is termed as bookkeeping. Bookkeeping is critical to any business because every transaction, whether purchase or sale, needs recording not just for the purpose of keeping track, but also from a business perspective to ensure that budget considerations are being met and expenses are utilized as intended.
There are two methods of bookkeeping: single-entry and double-entry. Usually, the single-entry system of bookkeeping involves summarizing cash receipts and tracking cash payouts by the business. In the double-entry system, if there is a record of earnings to be made, there will be two entries made: one which records outgoing cash or ‘debit’ from an account termed Cash, and another for recording the revenue earned, termed Revenue.
But regardless of which method is followed, bookkeeping is a process that needs diligence and must be carried out every day without fail, recording receipts and invoices. This is why it is best performed by a dedicated resource who is responsible for ensuring that all transactions, including credits, are duly recorded and tracked. Bookkeeping is said to be accurate when the entries are accurate and the sum of debits for all accounts matches the sum of credits for all the accounts taken into consideration.
What is accounting?
Accounting takes off from where bookkeeping ends. The transactions recorded by a bookkeeper are stored in books usually termed ledgers. There may be different types of ledgers, including sales ledger, supplies ledger, general ledger, etc. An accountant takes the information from these books and uses it to grade the economic activity of the business. Eventually, this information reveals the financial health of the business and how well it is performing, etc. Accounting data is critical to investors in the business, creditors, and regulators.
Speaking in practical terms, what do bookkeeping and accounting translate into?
In the course of a normal day, a business will exchange invoices, or credit notes for purchases made. Checks are issued, or expenses made. However, checks may be given a future date, which means the actual transfer of funds will take place on that given date or later, when the check is presented. Purchase receipts are received and some of them will be paid at a later date. All of these transactions are critical and generally get categorized as Accounts Receivable and Accounts Payable, referring to payouts or income.
The job of the accountant includes ensuring that the finances of the business are reflected accurately to provide the management and investors with the correct picture of the business’s health. This information is then utilized when making critical business decisions, including those of investing, selling, etc.
Both are critical to a business
If the bookkeeping function falters:
When the accounting function falters:
For a startup that intends to grow into a business, both these functions are indispensable. However, these are best carried out by experts to avoid the far-reaching consequences of errors.
The team of professionals at Analytix Solutions has expertise to help strategically guide small business in managing financial functions, including accounting and bookkeeping. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help your business forward, please call us today at 781.503.9002 or email us [email protected].Bookkeeping or Accounting: What do You Need More for Your Business?
With half of the year gone past, we are now in a position to assess whether the goals set in the beginning of the year have been achieved or not.
Further, now is also a good time to review what needs to be done for areas that have not seen growth as envisioned and could benefit from a fresh look.
Here are some trends to watch out for in the remainder of 2017, influencing CPA functions which can drive growth and fuel efforts to grow a business, from the accounting perspective:
Accounting Practices Remain the Same; Customizing is Key
As your customers also look at expanding, they realize that they probably need help in niche areas. You can help by delivering solutions that are customized to client requirements. These including accounting and bookkeeping solutions as well. You can cater to this need by carefully creating packages that are tailored to business needs. Customizing is also a great way to showcase your own skills and how best you can optimize available resources to meet key requirements.
Choose to collaborate with a CPA firm to help provide your clients the services they need within accounting, including tax work. This will immediately cut down on the expenses your own firm may need to incur in providing professional CPA-level expertise and reliability. Depending on requirements, choose from a collaborative model that best suits you and your clients.
New Technologies and Optimizing Data and Information
Accounting is adapting to technology in a big way. However, optimizing on this is important. Choosing the right technology in the form of software is important, but using inputs to make for proactive business decision making is equally critical. Often, we own a particular software but do not make full use of the inputs provided.
Optimizing your technology will be key to bolstering your existing efforts at accounting in the days to come.
Automation can take away the constant worry of getting things done on time – and ensure they have been done without errors. Automation increases the reliability of your data in a big way without compromising on the timelines. What you get is error-free numbers with an enhanced factor of reliability.
In the days to come, businesses will depend more on automation to carry out critical tasks. Optimizing on these will ensure you keep your accounting on track while also ensuring client requirements are met with a higher degree of reliability.
Cloud Technology and Cloud Computing
Cloud computing is connecting companies and rewriting the way business is conducted. Companies are now using cloud-based apps for many functions, including accounting.
The benefits of using cloud computing mean that as a business owner, you can now track your finance numbers regardless of physical location and access.
You can make critical business decisions based on information and data. Cloud technology also allows you to make rapid decisions. Using the cloud allows you to pass on these benefits to your clients, thus allowing them total transparency into the entire system and interactions.
In the days to come, cloud computing will allow better and more informed relationships, including within areas of accounting and CPA functions. Further, if you choose to collaborate with a CPA firm, your technical expertise will help you align your clients’ requirements with the work done in a more reliable manner.Trends Redefining the Accounting and CPA Landscape in 2017
How strong a company’s finances are can be gauged from the balance sheet, which in turn is assessed on the strength of the company’s working capital, from among several other factors. Even then, it is among the concepts that can be difficult to define for a small business or a startup. This is because working capital is the difference between current assets and current liabilities. Current here applies to assets that are convertible to cash within a period of 12 months or less and liabilities that are due for clearing or payment within the same period.
Working capital then becomes fairly easy, but it is not so for a small business or a startup that may not have much to begin with in the first place. How should you calculate the working capital, then? One way is by looking at the operating cycle.
The operating cycle typically analyzes accounts receivable by the number of days it takes to collect while accounts payable is calculated in terms of the number of days it takes to pay off a vendor invoice. Inventory, which is also part of an operating cycle, is analyzed in terms of the number of days taken by a product to convert to cash or account receivable (resulting from a sale).
How is working capital analyzed?
When a business has more current liabilities than current assets, it can have trouble in making its payments. Over a period of time if this does not change to more current assets, the business could head into bankruptcy. Working capital sometimes also goes into decline over the long term. When this happens, it could indicate slowing down of business in other ways like reducing sales volumes, or other operational reasons.
Inefficient operations can result in reduced collections and increase in working capital, as a result.
Why optimize and ways in which to optimize it
Optimizing the working capital is important because it is one of the major ways in which cash is available to a company.
Here are some of the ways in which you can optimize the working capital of your company:
Your business’ budget can be divided into two: cash and operating budget. Your business’ cash budget will focus on expenses and revenue estimates. A cash budget usually has entries for cash transactions that took place, such as salary payments and vendor invoices.
An operating budget is similar to the cash budget, only that it covers more details and has entries for sales, operating costs, production, and sometimes salaries.
However, regardless of the type of budget, most businesses will need to also follow long-term and short-term budget plans. Because budgets can be planned for different time periods, such as quarterly or yearly or longer, elements such as your capital outlay may need to be categorized differently in what would be longer-term budgets.
Whatever the kind of budget, it has to leave your business with cash adequate to run profitably and build a healthy financial report. Optimizing your budget is one way of ensuring this.
Optimizing your budget should be a primary item in your to-do list for your business. Given below are a few proven ways in which you can optimize your business budget:
1. Create a plan and follow it diligently
Most successful small businesses that made it big follow this mantra: create a business plan and ensure your accounts are in order. Many small businesses neglect to do this. But managing your accounts is the first step towards ensuring you’re in control of your expenses and actual income. Your business is already making profits, but how much of the revenue earned falls into place as per your budget? You may be surprised to know that it is not your profits that predict business health; it is your business’ cash flow statement. If you’re in control of your business accounts, this is one area you will not need to worry about. If not, there is still time: you can choose to seek help from professionals to help you with your accounts to ensure your expenses are not weakening you.
2. Increase the inflow of money; invest intelligently
As basic as this may sound, businesses can succeed rapidly through effective investment. Once you have made a budget plan, following it also includes investing money smartly so that it leads to effective returns. When raising money for your venture, ensure you take some time to choose which path you want to take. There are different ways in which to raise money, including pursuing angel investors, or asking for stakeholders to pitch in with money or even taking a loan as an emergency inflow of cash. At times, you may want to utilize a combination of the different ways to ensure you don’t fall short.
You may also want to consider selling off assets that are no longer performing as expected or that have outlived their shelf-lives.
3. Revamp your sales strategy to retain business
One of the ways to ensure more money is by bringing it in through increased sales and marketing. You may not be able to go after new sales right away but you can start by retaining clients. This can be done through offering rewards and providing value additions to your client deliverables. When you pursue client retention, you can expect not just repeat business, but also newer clients who come through referrals. Conversely, incentivize referrals, provide discounts, or create loyalty programs for existing clients.
4. Trim expenses through better negotiations; create newer marketing channels
Apart from bringing in more business to make up for deficits, it is a good idea to reduce costs through practices like negotiating better and trimming expenses on essentials such as a lease on the office premises, furniture, transport, etc. or choosing a vendor who supplies at a lower cost.
Look at alternatives to hiring new talent or recruiting staff. Instead, explore the option of utilizing online tools that could help you carry out the job.
You can also reduce expenses through the use of low-cost channels for all your marketing needs. If you need to reassess your target audience and change your marketing channels accordingly, you may find that this helps you cut down costs very effectively. Social media options can prove to be extremely effective in taking your message to your audience without costing your business a dent in the budget.
5. Reach out for professional help
Even if you feel unable to harness the options discussed, there is help available for you in the form of outsourcing your requirements. Outsourcing allows you to tap into a talent pool that is ready to start working on your needs without investments of time or money. Even after you decide to use online tools, you can still check outsourcing for help on operating and maintenance of the tools.
Outsourcing can also help you with business insights, goal setting and even creation of a budget based on analysis of your business needs, depending on the vendor you hire. This means you literally trim all unnecessary expenses out.Optimize Your Budget in 2017
By definition, Accounts Payable is the money that a business needs to pay to its suppliers or vendors. In accounting terms, Accounts Payable is a liability or a debt and is noted as such on the balance sheet. Each time a vendor or a supplier provides you with an invoice that has to be paid, it is becomes an entry in the Accounts Payable section of your books.
Accounts Payable also may be divided into categories such as Expense Payables, Trade Payables, etc. As a credit that is extended by vendors and suppliers to businesses, Accounts Payable may be defined by terms of payment or discounts received for early payments.
Current State of Accounts Payable Practices
Historically, Accounts Payable is an area that can be prone to embezzlement by those in authority and hence needs internal controls to ensure misappropriation does not take place. Misappropriation can take several forms, including forged or false invoices being issued or authorized employees adding vendors in a fraudulent manner to redirect funds. Accounts Payable are also subject to audits where the focus is mostly on expense reports and invoices that have been approved.
Internal controls often consist of steps that require multiple employees to complete the payment: one processes the payment, one signs the check that allows funds to flow out, and another second-signs the check in case the amount exceeds the agreed upon limit, etc.
Challenges Faced in Maintaining Accounts Payable
Given the documentation-driven structure of Accounts Payable, numerous challenges can arise from improper record-keeping resulting in data integrity issues. Some of those include:
Traditionally, documentation was categorized by Service or Product type, broken down into Advertising, Travel, Food Costs, etc. This practice is still adhered to in manual systems. As a result, filing invoices has been a task associated with maintaining Accounts Payable records. However, manual filing can still suffer from loss or temporary misplacements. These are also subject to misappropriation.
Benefits of Automation
As business transactions increase in volume and frequency, invoices and new orders may outpace a company’s bandwidth to manually process them in an organized, systematic manner. Automating this process can dramatically streamline managing Accounts Payables due to the following:
According to some online reports, technology is the key driver for process improvement. For all Accounts Payable functions, technology through automation helps by speeding up procedures, such as payment processing. The reduced time between delivery of supplies and payment helps to build trust and adds value to your clients’ work. Additionally, Accounts Payable features, such as invoice authenticity and transparency, can also be improved significantly through automation.
Mobile apps increasingly include transactional functionality. Users access data and conduct financial transactions over their cell phones more and more frequently. There has been exponential growth in the number of companies that adopt mobile app technology to reach their consumers and also to conduct business, including selling, buying and communicating.
A number of Accounts Payable functions can be deployed efficiently and successfully on mobile apps, such as accessing data, approving invoices, and generating bills.
Digital Authorization and Security
More businesses are embracing digital capabilities, rendering paper based or manual systems obsolete.
We have already witnessed digital authorization in the form of signature-less communication, passcode-enabled process approvals, and signatures recorded with stylus or by using a finger on a device. As businesses across industries embrace digitalization, its use for approving invoices, completing transactions, and processing payments is likely to increase, as well.
As these functions move towards digitalization, it will become important to establish a relationship with a trusted, authorized vendor who can help businesses transition these tasks with appropriate security levels. Because Accounts Payables include invoices and bills, your in-house staff should work in tandem with the vendor to close any gaps with regard to appropriate authorization levels. This can ensure security processes are customized as needed, especially with payment approvals.
Moving Further Into Automation
As businesses leverage automated processes, the burden of back-office administration is reduced. Time thus saved can be channeled into business building and revenue generation.
Accounts Payable data is made more accessible through automation. This data can then be shared more readily across departments and with the relevant staff and suppliers. The data thus sourced can be mined to reveal information regarding supplier or vendor behavior and patterns. Well-maintained Accounts Payable records are an indication of a company’s financial health.
Adopting updated Accounts Payable techniques not only resolves challenges associated with manual management, it will also improve your firm’s productivity and efficiency.
Analytix Solutions has a team of professionals experienced in Accounts Payable. For more information on how we can help your company with Accounts Payable needs, please visit us at www.analytixaccounting.com or email us at [email protected].The Future of Accounts Payable
Managing growth is often top of mind with business owners. Healthy business growth is crucial to the company’s long term sustainability. However, often times small to mid-sized business owners reach a plateau in their ability to drive new business due to both manpower and financial resources. The challenge for businesses in this lifecycle stage becomes how to grow the company while simultaneously
This often becomes a vicious cycle, as one can be dependent upon the other. Following are several alternative strategies that small to mid-sized companies should consider as options for breaking through that growth plateau.
1. Saturate existing client base and target profile
Before pursuing new prospects, small to mid-sized businesses should attempt to fully saturate their existing client base and narrow, targeted audience. Have you pursued all possible sales options for upselling or cross selling your services to your existing clients? Client retention and repeat sales are less expensive growth strategies than driving new business and pursuing new leads. New leads need to be educated on the value your company delivers to them.
2. Offer complementary products and services
One of the best ways to increase growth is to offer complementary products or services which are a natural fit and which do not require much additional training or a substantial initial investment. Assess your primary services, and evaluate what additional options would provide a more robust solution to your clients. For example, if you design websites you could offer clients a maintenance plan for those sites. If you run a car wash, expand service to include interior auto detailing. If you sell vacuums, sell vacuum bags as well.
3. Explore partnership opportunities
Partnerships can be one of the most efficient ways to expand service offerings and subsequently position your business for growth. Consider partnering with a company that provides complementary services or products. For example, as a wedding planner you may decide to partner with a photographer or a specialty bakery.
You can offer these services as an extension of your own business while relying on the expertise of the partner to deliver these additional services. This allows you to function as a reseller of that good or service while simultaneously profiting from it AND mitigating the risk of investing in developing new offerings on your own. Leveraging partnerships also will allow you to compete with larger companies.
4. Pursue referrals
One of the most effective sources of new business is from existing clients and customers who are pleased with the service you provided. Remind existing clients and customers that you appreciate their referrals, and consider offering them an incentive or thank you for referrals that result in new business for you. Prior to expending time and internal resources on growing your business via new lead acquisitions, put positive client relationships to work and maximize a referral strategy.
5. Establish a niche market presence
If possible, identify a distinct market for which you company’s product or service provides a specific solution or modify your product or service slightly to address this market’s “pain points”. Penetrate that market deeply so that you become the “go to” provider.
When attempting to overcome that growth plateau, small to mid-size companies should test some of the above strategies for growing the business as they do not require a significant shift in existing operations or resources.
The team of professionals at Analytix Solutions has expertise to help strategically guide small business in managing growth. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call us today at 781.503.9002 or email us [email protected].Hitting the Growth Plateau: 5 Alternative Strategies for Breaking Through
Simply put: Your company’s cash flow decides whether or not your business will continue and whether it will grow. For example, if your business creditors need money within 10 days while your invoice payment date is 20 days later, you will soon run out of money. Unless you optimize your cash flow to align the inflow and outflow better, you will find your business in this situation more often, than not.
More basics on cash flow
Cash flow answers to the timing of money flowing into a company. A business may be profitable and yet not have positive cash flow if they don’t have liquid cash for expenses. A positive cash flow can help the company go from strength to strength while a negative one can push it to bankruptcy.
Given that cash flow plays such a crucial role in keeping your business running, it makes sense to ensure this function is optimized to make a measurable, positive impact.
Profit is not cash
The surplus revenue you have in the balance book after you have paid off all your expenses is termed as profit. But profit alone is not enough to sustain a business. You must have positive cash flow to ensure your business is sustainable.
Shared below are some tips to help you optimize your company’s cash flow:
Plan business expenses and investments well
Planning in advance will help you decide timelines for cash expenses. When you plan in advance, you can actually arrange for the cash well in advance to ensure readiness when the need for purchase arises finally.
Review all of your costs, including rent, subscriptions, and other payments that your business needs to pay out. After this, cut down on those that are not needed and can be done without.
Do your tax planning
Tax planning is important to avoid losing money due to lack of understanding. Ensure you know your tax laws well so that you do not end up paying unwarranted taxes and then chasing returns.
Streamline your staff
For a startup or a growing business, it is ideal to invest in staff once the business is established. Outsourcing requirements can be a great option for these businesses since it is reasonable and provides access to trained resources as well.
A new year is a good time to revisit contracts. If your customers have been genuinely happy with you, there is not much reason for them to choose not to review the situation once and review your contracts.
Utilize available software tools
Tools that help you streamline your cash flow are available. You need to know how to use them best. These can help you manage cash flow efficiently and more accurately.
Diversify your customer base
This may not be a strictly accounting solution, but it helps ensure your cash keeps flowing in. A diverse customer base means you are not relying on a single paying customer for your revenues.
If you are a startup or a growing business, you will still need to factor in these critical functions alongside business development.
Effective cash flow optimizing could mean the difference between your business hitting profitability but struggling to survive, or ascending the growth curve rapidly and without hassles.Optimizing Your Cash Flow
With 2017 well on its way, this is a good time to take a quick look at your business’ accounting and cash flow management to see if there is anything that needs to be reviewed or changed.
As one of the major markers of your company’s financial health, your cash flow statement is a good guide to movement of money within your business. Remember, cash flow is one of the decisive factors that will help keep your business going.
While there are no magic formulas to increase cash flow immediately, there are some time-tested and proven practices that can ensure the cash flow remains positive. Listed below are four tips to increase your cash flow in 2017:
1. Customer is central; but ensure credit-worthiness first
The year 2017 looks like it will be focused on the customer; but make sure you do business with customers who will make payments or are credit-worthy. Whether you offer discounts or accept payments at a later stage, make sure your customers will not default.
2. Review overdue payments
One of the easiest ways to ensure you get payments on time is to follow-up on overdue payments. Late payments from as recently as November or December 2016 can also make a difference to your business’s cash flow. When you follow up on overdue payments, you help bring money into the business while also conveying an important message to clients that you are indeed on top of your business matters.
3. Better forecasting
As you ease into the year, it is helpful to arrange for money to flow in for business investments planned in the future. Cash flow forecasting helps you understand the situation of money at any given time in the business. While it is still not 100% accurate, forecasting gives a near-accurate account of the situation so that you can make informed business decisions regarding expenses and investments.
4. Ensure prompt collections
Because positive cash flow depends on timely payments, prompt collections can help a business avoid hassles such as invoice backdating or chasing debts. One of the ways in which you can ensure prompt collections is through timely invoicing. As businesses move towards cloud-based accounting, you can consider using software that also takes care of invoicing. If you are unsure of this aspect, outsourcing can prove to be helpful. Outsourcing will ensure invoicing is prompt and timely while streamlining the function to improve the process of invoicing and collections, eventually.
One last tip
Remember that your profit is finally about the money that is left after all expenses are paid out from your business’s revenue. Survival of your business eventually depends on liquid cash available with you; this is different from profitability. As a result, it is vital to ensure that your cash flow is on track. If you are unsure about accounting, consider outsourcing your requirements. This ensures timely cash flow for the business while helping you focus better on critical business development functions.Tips to Increase Your Cash Flow in 2017
According to an online report by “451 Research”, 60% of workloads will operate in the cloud by 2018. (Cloud Computing Trends for Accounting)
The accounting profession has evolved to embrace new technology; this includes practicing professionals who have also adapted to working in the cloud. However, as businesses move towards working more consistently in the cloud, there are some essential requirements to ensure successful, cloud-compliant accounting for any business.
Here are a few questions you should consider to assess your cloud-readiness better:
Cloud Readiness and Preparation
Compliance will require you to address technology, data security (regulatory and compliance), and operational reliability.
Adapting to Cloud-based Software
This seems like a natural transition with higher acceptance of SaaS products and offerings emerging. Depending on your firm size and volume of clients, you can look for cloud-based software for research, particularly for tax and auditing purposes.
Software readiness will also prove to be useful. For a small to mid-size firm, outsourcing can prove to be of immense help, if not already considered. Your outsourced vendor will have the right infrastructure in place and can help you find solutions relevant to your business, in terms of accounting software and its deployment.
When you look at software infrastructure, remember that software will require updating. The software you install should allow for regular updates and upgrades to ensure smooth and seamless operations.
Policies and Regulations
An important aspect of cloud computing is compliance. Policies and regulations will be applicable, especially with respect to data, including that belonging to the client. Depending on the industry in which you operate, you will have to work according to the applicable regulations.
Policies and regulations are also applicable to the security levels you provide. Whether it is about authorizing access or encryption, you need to keep your security provisions transparent to foster client trust. Though security is a feature built into the process when you move to the cloud, you may need to communicate this to your clients. Outsourcing can be a useful practice here because a vendor will manage and maintain the cloud based program. Furthermore, outsourcing vendors are on top of regulatory and compliance matters, as well. You just need to verify their certifications.
The professionals at Analytix Solutions have helped many small to mid-sized businesses migrate successfully to the cloud, enhancing their security and operations in the process, while adhering to budget. For more information on our services, please visit us at www.analytixaccounting.com or email us at [email protected].Make Your Accounting Cloud-Compliant in the New Year
Accounting functions are rapidly migrating to the cloud, and this is substantiated by figures released by cloud accounting software providers such as Intuit (with an increase of 41% in subscribers for QuickBooks Online, per its 2016 fiscal report) and Xero (which experienced 51% growth on its subscriber base in the year ending March 2016).
With reduced costs, increased independence due to freedom from physical boundaries and infrastructure, streamlined operations, and enhanced security measures, the cloud is positioned as the ideal choice for businesses that perform their own accounting and for businesses which perform accounting functions on behalf of clients.
As cloud-based platforms gain ground, it is important that companies embrace this technology to capitalize on its benefits.
Trend #1: Prioritizing Client Needs
Cloud apps that will enable accounting to become more secure and accessible will rule in 2017. Features such as bots and mobile apps will allow better access to financials for authorized individuals, thus improving the overall client experience.
As financial data is confidential for most companies, security is a priority and cannot be compromised. One of the best ways to ensure client satisfaction and loyalty is to provide better data and security for their data.
Moving your accounting processes to the cloud can help you provide enhanced security to your clients more comprehensively. You can customize security in several ways, including adding encryption along with regular features such as authorized access, etc.
Cloud based accounting can also improve you clients’ experience by providing easier access to information, improved communication, and transparency through collaborative interfaces such as dashboards. Connectivity between accounting professionals and their clients is also stronger due to tools such as instant messengers and chats, resulting in more seamless delivery of services.
Trend #2: Easier Customization
Most cloud accounting applications allow for multiple operations, so customization within those applications will become easier.
Unlike earlier conventional accounting practices, cloud-based apps allow you to provide your clients with several services consolidated under one roof. Features such as accessing accounts payable, tracking invoices, and calculating timesheets for payroll or productivity are all better managed through software apps. You can select the ones most appropriate for your needs and sync it with your clients’ requirements to ensure you are able to customize better.
Trend #3: Equipping Small Businesses for Advisory Roles
With more businesses moving to the cloud, clients will be relying on their partners and vendors for help with business insights, as well. Businesses will need to equip themselves better for this role, and cloud apps will prove to be helpful as companies begin to navigate the world of consultation. Cloud accounting also streamlines operations, freeing up valuable time that can be reallocated to providing added value to your deliverables due to these business insights.
Trend #4: Transforming Job Model
For those who believe that technology reduces human engagement, think again. Cloud computing promotes flexible working practices for accounting professionals, independent of physical location. Working remotely has significant benefits from a business continuity perspective, and it is becoming much more widely accepted, especially due to reliability and security enhancements made possible with cloud based technologies.
In 2017, it is predicted that accounting professionals who are competent in managing software and leveraging the full capability of apps will be able to provide higher value to clients.
The experts at Analytix Solutions have helped many small to mid-sized businesses migrate successfully to the cloud, enhancing their security and operations in the process, while adhering to budget. For more information on our services, please visit us at www.analytixaccounting.com or email us at [email protected].Cloud Computing Trends for Accounting in 2017
Inevitably, it’s that time of the year again when you need to prepare to meet with your CPA to discuss taxes. You need to take stock of your investments, any financial transactions undertaken, and, most importantly, the paperwork to support these.
Typically, the biggest challenge revolves around locating and compiling the relevant paperwork when it is needed. To make the most out of your meeting, it makes sense to locate these documents and papers before you head out to the CPA.
Following is a short list of some common documents you should have before rushing off to your CPA.
-Investment Account Statements
Invoices, Bank Statements and Investment Accounts
As a small business, you need to carefully track your receipts and invoices. Any record of income, such as bank statements and investments need to be provided. The form 1099-INT which reflects your savings and interest is also required by your CPA.
For this reason, it is important to perform timely reconciliations of your bank statements and to keep your income receipts, investment account documents, and brokerage account papers easily accessible.
If your business is classified as a partnership or corporation, you are also required to report any income or loss in the form of a Schedule K-1. This form carries details of individual shares of income within a partnership or corporation.
Miscellaneous office related expenses
Mortgage interest statements
Your expenses could range from direct office expenses, such as supplies, to more significant expenses, such as travel.
If you use your car for business purposes, you can claim it as a deduction or at least miles driven for business purposes as a deduction. Make sure you also track receipts for any tolls incurred while driving for business purposes.
If your company hires employees, then you need to provide documentation of their salary or wages. There is also the Form W-2, W-3, and other state payroll returns such as Form 940 that you will need to keep updated.
In fact, the Social Security website has the capability of online W-2s, where you can create and print up to 20 W-2 forms for your employees. Check this URL: http://www.ssa.gov/bso/bsowelcome.htm to access the service.
Do you have people assigned to specific tasks in your company or hired for a specific expertise or duration? If so, then you need to report their earnings from you via a separate form such as a 1099-MISC which contains details of payments made to agents contracted by you.
You can also claim tax deductions if you are providing retirement plans to your employees. Keep this documentation on hand.
Many small businesses or enterprises operate out of the owner’s home. If you are using your home for business purposes, you can include documents to support your mortgage interest, insurance, and other maintenance-related expense documents for the purpose of deductions. If you are self-employed, you may need to use Form 8829 for claiming this deduction.
If your office premises are rented, you could claim deductions on the rental taxes related to real estate and other utilities.
Some small business owners have taken loans for business activities. Any money borrowed for business purposes can be deductible, if you have valid documentation supporting its usage.
Insurance policies taken for the purpose of business coverage can be reported as a tax advantage, so be certain to keep track of these insurance papers.
Use this checklist to prepare for your next tax meeting with your CPA.Checklist for Meeting with Your CPA
The statistics are impressive: According to Statista, the accounting industry is expected to generate around 160 billion in revenue by 2018. As services move online and apps influence the way consumers conduct business, including banking, embracing technology is one of the ways to grow in a digital age. According to an overview of the Accenture Technology Vision report, today’s platforms are backed by digital tools such as cloud, mobile, etc. When surveyed, 81% of businesses believed that industry boundaries will blur. Efficiency levels are expected to increase as more businesses embrace and master digital advances.
Automation in CPA firms
For CPA firms, automation proves to be indispensable. There are large volumes of accounting data, and sifting through it requires a significant amount of time and attention. Tight time deadlines also need to be considered when processing tax data.
Compliance preparation work, such as checking documents, multiple bank accounts, card account reconciliations, and matching inventories, by itself is a time-consuming task. This entails entering data on multiple spreadsheets, checking corporate filings and extensions, audit requests, and revenue adjustments. However, organizing and managing these core tasks manually increases the chances of error, thus rendering the resulting data unreliable unless thoroughly checked.
When you automate these tasks, you ensure every bit of data is retained and recorded away to be accessible when needed.
Automating tax processes not only addresses the tasks discussed above, but also executes them rapidly, without the time delays usually associated with manually managing the tax process. Furthermore, embracing and implementing technology is fast proving to be one of the key ways to manage business growth. According to Investor’s Business Daily, spending on cloud infrastructure and platforms is expected to grow up to $43 billion in the year 2018.
Automating the tax process
Automating tax processes can include tasks such as risk management, compliance, information sharing and collaboration. Automation can ensure better document management and sort data efficiently and with greater reliability. Other key processes within the firm that are streamlined by automation and hence lead to greater streamlining of the tax process, include functions like time entry, billing and due date management.
Automating the tax process leads to more organized operations, reduced costs in the long term, and most importantly, accurate tax figures and timely payments for your customers, thus improving their overall experience. This is a big plus for your business.
Implementing automation of your tax processes
Automation of your tax processes needs to be implemented without letting it negatively impact your business. Following are some of the ways in which it can be done:
Planning and Analysis
At this stage, careful analysis of your business is carried out, including assessing the requirements of your clients. It is best to build a business plan which also accounts for the scope of services and products that your firm offers to your clients. A business plan takes into account the precise requirements of your company, thus enabling customization. You can also add expected timelines to your plan to ensure accuracy.
These requirements can include the need for white labeling some solutions, a detailed cost-benefit analysis, and budget allocation. You may want to add risk analysis, as well as a detailed list of desired outcomes including the number of client cases you would ordinarily process on a daily basis. This can help allot the right number of resources to your assignment so the work is completed on time and as desired.
Once your business case is built, you need to consider a vendor who provides automation. Assess their processes and how critical tasks such as data extraction and validation are carried out. This can help prevent interruptions in the day-to-day work.
Your implementation plan will also include a timeline for completion, testing and release. However, the final release occurs after beta testing, during which any problems and challenges are identified and a plan to resolve them is crafted.
This is the last step. It occurs after the automated process is launched and entails optimizing the process to generate the results your business needs to catapult itself to the next growth phase.
As part of optimization, you will need to revisit the initial plan, check parameters and whether they have actually succeeded, and determine how well the process is meeting your business needs.
Benefits of automating your tax processes
As more and more businesses, including established companies and startups, adapt to the digital boom and apps, automation is a viable way to manage growth without impacting your bottom line. However, as with most critical business functions, you need to research vendor who will understand your requirements and provide a customized solution.
Automation can effectively reduce operational costs for a startup by eliminating needless processes and checks. Moreover, the returns in terms of reliable data and accuracy are reflected in clients’ satisfaction. In the case of tax processes, trust is extremely important. When you meet client expectations with high-quality work, delivered on time, you are investing in your business’ growth as well. Automation also frees up time from performing critical, time-consuming tasks to focus on what is more important: business development. If done correctly and in sync with your business’ unique needs, automating tax processes boosts your CPA firm’s productivity.
Analytix Solutions has a team of professionals experienced in automating tax processes. For more information on how we can help your company with tax automation process needs, please visit us at www.analytixaccounting.com or email us at [email protected].Automating Tax Processes to Boost Your CPA Firm’s Productivity
Small business owners recognize that a budget is the single most important tool for managing their business. When creating a budget, keep in mind that it needs to both sustain business growth while mitigating any financial hassles.
Following are five budgeting tools that are suited to small business needs:
1. Whitebirch Planning: For most small businesses, “budgeting” resembles a flexible system where some items may be deferred in order to redirect funds from other areas to address a more urgent need. Whitebirch Planning allows you to factor in the unexpected. The model takes into consideration the analysis that accompanies events, as well as unanticipated situations which arise. Projections therefore account for specific business needs while allowing the business funds to accommodate any unforeseen expenses.
2. Visual Focus: This tool also works well for large businesses. It is useful for creating budgets and integrates planning, forecasting and financial reporting. This allows you to have a clear understanding of the state of your finances while also providing assistance with forecasting, including rolling forecasts.
The software is easy to implement and helps bypass errors associated with conventional budgeting spreadsheets. It includes planning for unexpected scenarios as well.
3. PlanGuru: This is an affordable tool which is appropriate for both small and mid-sized businesses. It combines budgeting and forecasting for as long as a ten year time frame, without the hassles of creating and correcting formulas. This software does not provide general ledger facilities or capital asset planning. However, given that its features are suitable for the growing business, it offers analytical tools to help the business owner with financial ratios, income statements, etc., all of which can help improve business productivity and performance.
4. Adaptive Planning: This software allows for on-demand budgeting and forecasting solutions for small to large-sized companies. Its features allow you to see a real-time snapshot of your finances, including performance metrics, to streamline your budget-creation. It also serves as a more reasonable on-site solution providing everything, from audit trail, to covering the unexpected, to general ledger and capital asset planning.
5. Altus Dynamics Financial Management Suite: This tool covers businesses in diverse sectors, including not-for-profit and social services. The software is based on the Microsoft Dynamics NAV platform, which helps users adapt to it faster if they are already familiar with Microsoft software. Users need not possess specific finance backgrounds to be able to use it. Requests for funds, purchase requests, etc. can be easily logged in by staff. One limitation of the system is that it does not provide for project budgeting or consolidation.Budgeting Tools for Small Business
Budget planning and implementation significantly impact the course a business will take. For small businesses, the budget determines whether the company will expand or close down. Business expenses need to be kept in check so that they do not surpass income; without a budget, cash deficits can quickly accumulate through over-spending.
Consider a budget as a critical tool that assists with business operations. Typically, a budget is created and reviewed annually. Following are five common pitfalls to avoid when developing your company’s budget:
1. Making an unrealistic budget
Small businesses typically maintain spending restrictions. Although it is important for small companies to guard against overspending, one budget creation pitfall is that of creating an unrealistic budget. Business owners may unintentionally create a budget that is simply too tight, which may lead to hampering everyday operations. This results in constant budget revisions for unplanned expenses.
Conversely, it is equally easy to overspend and create an inflated budget which does not coincide with profitability goals. Attempt to create as realistic a budget as possible.
2. Not outlining your objectives clearly; confusion between what is needed and wanted
Following your business plan is vital to developing a budget that fulfills all your business needs. Disregarding the groundwork that is laid out in the business plan leads to creating an unrealistic budget. If for some reason you have not yet developed a business plan, begin by outlining business objectives and allocating specific dollar amounts to each objective as you build your budget. Be sure to allocate but also to monitor these funds, as simply allocating funds to potential activities can lead to miscalculations and overspending, which results in financial problems.
Remember to include and account for items such as profit-sharing expenses, staff bonuses, and maintaining a good credit history when outlining your objectives.
3. Not leaving room for the sudden and unexpected requirements
Ideally, budgets are created based on a business plan. However, this may not account for any unexpected needs. Plan and budget for unexpected expenses to avoid having to draw funds away from other important budget categories, resulting in a needless financial hassle. Instead, plan for the unexpected, and set aside funds for these unplanned situations. When creating a budget, keep in mind market price fluctuations that may impact your expenses
4. Depending on future earnings
How often do we make the mistake of assuming that a future income will pay for a certain current expense? While this thinking is not entirely wrong, it is all about achieving the right balance. Instead of allocating significant funds that are dependent on future earnings, consider holding off on incurring the expense. You can then allocate this expense to the next billing cycle. If the expense cannot be deferred, evaluate vendors who offer something more affordable. If necessary, invest time researching more affordable suppliers who will agree to your payment terms.
5. Insisting on precision
While matching expenses to income is central to a budget, how much precision can you achieve without wasting additional time and money? Trying too hard to include everything inside a single budget can lead to frustrations and wasted time. Furthermore, a precise budget unintentionally may not allow for unexpected expenses.
Attempt avoiding these pitfalls to make the budget process as smooth and as effective as possible. You can check out our Budgeting Tools for Small Business for effective budgeting.Five Common Budget Pitfalls
Implementing cloud computing saves businesses from heavily investing in building and maintaining computer servers. Furthermore, it also reduces the need to buy or build alternate means of information storage. Cloud services also enable you to communicate and access your information from any physical location, regardless of where your office may be. Shifting to the cloud can thus help increase your company’s profitability while decreasing costs.
Business owners cannot harness these benefits by blindly making the shift to the cloud, as a mistake might prove to be very costly for your company. Here are five tips for moving your business to the cloud successfully.
1. Assess what you want to accomplish from moving to the cloud
There are numerous variations of cloud services. Review and research the pros and cons for each one once you shortlist the models that you feel fit your business needs. Cloud features vary from the ability to work offline, to the number and type of software and apps, to different ways in which you can access your company’s data.
2. Take your existing IT system into account
Before migrating to the cloud, take stock of your existing IT capabilities. Evaluate your processes and survey your requirements. This also means checking the needs of your business operations and the needs and capabilities of your staff. What is the arrangement you have with your employees? Do you need them to access information irrespective of their location??
In addition, if yours is a business actively engaged in client deliverables, etc., you may need to ensure that your system’s move to the cloud does not disrupt daily operations.
3. Choose a reliable vendor
If your business is just starting out, you need to be careful you do not end up spending money needlessly. Conduct research thoroughly before proceeding with contracting a cloud services provider. Check reviews if they are available, and ask for referrals from fellow business owners that are in a similar situation. If you have access to expertise from engineers and other IT professionals, ask them for their opinions.
When deciding upon the vendor, check whether or not they also provide other services such as tech support and troubleshooting.
4. Check security features
Information that resides on the cloud can be accessed remotely from anyplace. This also means it is more vulnerable to disclosure. When you review vendors, also review safety measures. You need active and robust security features in place, including access control, authorized access, spam filters, antivirus programs, and surveillance.
Security at the vendor site may also need review. Do they have restricted access to their servers? How do they secure their own facility? Do they conduct regular audits and testing, etc.? All of this will have a direct impact on the services you are provided.
5. Check the legalese
As with any other contract, there is bound to be some fine print. Make sure you read through and check for any hidden costs. You may need to review details, such as Service Level Agreements (SLA). If needed, bring in an expert who can help you. The chances of an outage always exists with any technical service. However, with a Service Level Agreement, you know exactly what to expect.
The experts at Analytix Solutions have helped many small to midsized businesses migrate successfully to the cloud, enhancing their security and operations in the process, while adhering to budget. For more information on our services, please visit us at www.analytixaccounting.com or email us at [email protected].5 Tips for Moving Your Small Business to The Cloud
At first glance, cloud computing and accounting seem diametrically opposite; one is a futuristic concept while the other, accounting, is an orthodox discipline that forms the bedrock for all business houses.
However, cloud computing, implemented across the Internet is actually all about convenience and cost efficacy, especially for small and medium businesses. Also, several solutions have been developed in the form of Finance and Accounting applications for cloud computing. Regardless of the size of your business, cloud computing can help in:
Currently, it would be safe to say that these applications are focused on accounting activities such as budget management and reporting. Core areas such as auditing are still not as well connected with cloud computing; scope exists for more work in connecting auditing with the conveniences of cloud computing.
The American Institute of Certified Public Accountants has recommended finance and accounting Software-as-a-Service (SaaS) solutions to businesses dealing in accounting. What this means in the larger practical sense is that, any business house, irrespective of revenue and size, can harness the benefit of the cloud without first needing to bolster it up with large capital.
Further, apart from providing value for money services, it also weaves in the flexibility to introduce changes. Change could refer to anything – expansion or modification in your service offerings or requirements. With all these advantages, accounting software is already doing brisk business in the markets and it seems like just a matter of time before cloud computing takes over other aspects of accounting as well.
Weaving cloud services into your accounting function can have several benefits:
In this perspective, cloud computing seems all set to change the face of accounting; several accounting applications in the market currently are well adapted to the cloud; in fact, some applications have been developed keeping the cloud in mind.
When you invest in cloud computing-compatible software for your accounting function, you also enable it to become part of your business strategy. Since accounting is often the bedrock of any business, harnessing the advantages of cloud computing make sense from several perspectives:
Cloud computing can bring together different functions to allow for synchronized working within your company. This can strengthen your core deliverables as well, because your back-office work is being taken care of.Shaping The Future Of Accounting Using Cloud Computing
Small business owners face a multitude of challenges as they struggle to develop their business from infancy to a stabilized operating entity. One of the most critical areas to manage from the financial and operational perspective is cash flow. Following are several strategies that business owners can apply to assist with cash flow management.
Almost all business owners understand the saying “Cash is King”, but many remain unaware of the cash sources and uses within their business. Although many business owners view net income as a cash benchmark, net income provides only a partial picture.
Profit and Loss Statement
The profit and loss statement (“P&L”) provides business owners with an indication of the company’s economic performance. However, unless the books are kept strictly on a cash basis, the reported net income very rarely equals the increase or decrease in cash holdings. (In cash basis accounting, almost all transactions are reflected in the P&L.) Instead, many companies elect to use accrual basis accounting where expenses are matched with sales, regardless of whether cash has been paid out or has been received. The lesson here is that net income does not equal cash.
Prior to receiving any financing, a business typically needs to submit a business plan which provides a road map on how that company will achieve and sustain profitability. The plan identifies sufficient sales volume levels and related expenses. Continuous comparison and adjustment of actual operational revenue and expenses, between the P&L and the business plan, is an effective method of managing cash resources provided by net income.
The balance sheet lists assets owned by the company, liabilities due to third party creditors, and the portion of the assets remaining for the company’s owners. Frequently, the balance sheet is not prepared in conjunction with the P&L, or it is overlooked in favor of the P&L. Unfortunately, control over the balance sheet is a major factor in cash management, so overlooking it can be detrimental.
As unlikely as it seems, a profitable company can become insolvent and result in bankruptcy protection. Cash usage not reported within the P&L, such as significant increases in inventory and receivables, quickly can reduce a company’s liquidity. Following are strategies for managing the balance sheet.
Analytix Solutions has a team of professionals experienced in cash flow planning and management for small to mid-sized companies. For more information on how we may be able to assist your business, please visit us at www.analytixaccounting.com or email us at [email protected].Cash Flow Strategies for Small Business and Franchises
Small business owners sometimes mistake profitability for cash flow. Whereas a company can be profitable on paper, it can simultaneously be “cash poor” lacking the resources to pay bills, including payroll. This is the type of situation that small businesses and startups seek to avoid, as cash flow can literally make or break a business.
To mitigate this, business owners should have a clear understanding of their company’s sources and uses of cash, as well as the timing on those outlays and inflow. Following are several tips businesses can take to proactively manage cash flow.
1. Manage receivables efficiently
Although account receivables represent money owed to a company, those funds are useful after they appear in your bank account. Account receivables cannot be used to pay bills, therefore business owners must have knowledge of their daily cash balances in order to have a realistic snapshot of the money actually in possession. Managing receivables efficiently allows business owners to collect the associated cash quickly. There are several steps that business owners can take to ensure this:
2. Make bill payments when they are due
New businesses should be wary of paying bills too far in advance unless there is a significant discount or offer. Paying bills in advance ties up otherwise “free” cash, so paying the bills “on time” allows for more flexibility in cash flow planning.
3. Ensure better payment terms
Work with vendors to negotiate terms that benefit your operations. Maintaining good vendor relationships is critical, as ideally vendors would let you invoice clients, collect funds owed, and then pay the vendor’s receivable. Dedicate a significant amount of time researching and negotiating the best terms possible.
4. A steady line of credit
A steady line of credit can be extremely useful to young businesses. Credit lines can compensate for unforeseen cash flow problems. Lending institutes such as banks may also issue lines of credit. Do your homework to ensure a good interest rate.
5. Maintain an alternative source of income
Even if it means cultivating an alternate source of revenue, it is always better to back up a line of credit with an alternate income source. Consider complementary services you can offer clients during non-peak periods, to compensate for periods when cash flow may drop off.
Analytix Solutions has a team of professionals experienced in cash flow planning. For more information on how we can help your company with its cash flow planning needs, please visit us at www.analytixaccounting.com or email us at [email protected].Five Tips for Effective Cash Flow Planning
Financial reports provide insight into a company’s health and financial status for a particular time period. Financial reports are designed to provide data to the company’s shareholders, including potential shareholders or investors. Thus, financial reports must provide accurate and relevant data to enable decision making. Relevant financial reports should contain enough data to assist investors in making key financial decisions for the business.
The International Accounting Standards Board has created the International Financial Reporting Standards (IFRS) to help bring about consistency in the standards of financial reporting. This also helps ensure uniformity in the reports that are produced. The IFRS explains how to state financial transactions within a report, thus making for a more standard format, across reports. The guidelines established by the IFRS make it easier for financial reports to be studied globally, without creating confusion due to different rules in different countries.
Despite set standards being followed in creating financial reports, there are still errors that surface and that can compromise the quality of a financial report. These can be related to errors of omission, or involve matters such as long-term debt. Errors can also occur when dealing with information accompanying the financial report.
1. Information accompanying report: When providing information including financial documents, care must be taken to ensure that corresponding references are present in the financial report, as well. Examples of accompanying information can include listings containing work schedules, accounts and expenses.
2. Long-term debt disclosure: Inappropriate disclosure of long-term debt is a common error. While the rule is that any long-term debt or borrowings must be disclosed, errors may include incomplete disclosures or debt details totally omitted out of human error or through calculation mistakes. Thus, insufficient disclosures may be made, or disclosures are not made at all, resulting in financial reporting errors.
3. Related party disclosure: When there is an exchange of money involved, there is a related party disclosure that is applicable. However, at times, this may not be reported appropriately. At times the amount or terms followed by both parties may not be correctly disclosed. This can result in an error.
4. Errors of omission: At times, reporting of costs may be incomplete, for example, expenses may be accounted for but costs involved in raising funds and revenues could get omitted in reporting. This could apply to events as well, where overhead costs are not documented properly or timesheets are not maintained.
When preparing financial reports for your business, take note to avoid the common errors listed above.Common Errors in Financial Reporting
Accounting and bookkeeping functions play a large role in deciding the financial viability of a business.
In the case of the small or mid-size company, this holds all the more true. When every little decision and operation is determined based on budget, it makes sense to understand whether all your hard-earned money is allocated correctly.
In a typical small-sized business, the focus is concentrated on fulfilling client requirements and meeting deliverables. Manpower is often limited, with one individual managing multiple responsibilities. Opportunities for error in such situations increases, and therefore so does the significance of understanding your finances and correctly reading reports. Financial reports have a significant bearing on the future of your company. The golden rule for all small businesses remains constant: if you are not adept at financial reporting or uncertain about how to read them, hire professionals for conducting accounting-related work instead of trying to do it yourself.
However, if you do choose to review them yourself, there are several key elements that you should evaluate when reading them.
Your income statement will reflect your profits and losses. This is performed via columns on revenue and expenses. A summary of your revenue compared against the expenses incurred will indicate whether your business is performing well or not. The income statement typically reflects the growth or reduction in a company’s assets over the accounting period which could be a single month, several months, or one year.
The income statement is also a comparative document for evaluating how your company has fared previously. It contains other factors such as net sales, gross income, operating income, operating expense, taxes, etc. When you read income statements for consecutive years side by side, you can calculate the percentage change in your company’s net sales, operating expenses, and operating income. This helps you establish a budget and to decide where you need to reduce expenses and allocate additional funding.
The balance sheet lists the company’s assets, liabilities, and owner’s equity. The owner’s equity is the difference between the assets and the liabilities. The balance sheet is also an indicator of your company’s financial health. When you evaluate a balance sheet, you should be able to assess whether your debt is in control.
Elements of a balance sheet include:
Assets: Assets are what the company owns, which may include movable and immovable properties, such as land or machinery equipment. There are two kinds of assets- current and fixed. Current assets are converted into money within a period of one year, while fixed assets refer to property that generates income and are not expected to be sold within a year.
Liabilities: Balance sheets also list liabilities which are debts owned by the company. These are categorized into current liabilities, those that need to be paid off within one year, and long-term liabilities, those that are not bound by the 1-year limit.
Owner’s Equity: Once there are funds invested into a business, it is viewed as a sum of assets and liabilities. A business must be funded to make it operational before it can start acquiring assets. The owner’s equity is the value that remains in a business after removing the liabilities from the assets.
Statement of Cash Flow
How does your company use its cash? Your cash flow statement will provide you the answer to this question. Cash flow statements assign cash expenses within a specified accounting period to one of three categories-, Operations, Financing, and Investing. These are then added to determine a figure which is further tallied with cash reserves in the beginning of the accounting period. Examples of elements within a statement of cash flow can include cash given to employees (operative expense), cash allocated to purchasing machinery or equipment (investing), and cash provided by owner (financing).
All business owners should have a thorough understanding of what these statements mean in determining the success of their company.Reading Accounting and Bookkeeping Reports
You seized the opportunity to start a new venture, dedicated yourself to making it work, and now you’re the owner of a successful, small business. But how do you break through that glass ceiling? Here are some suggestions which will help propel your small business to the next level.
Reassess Business Plans
Take a closer look at your business plan. Are you dealing with products or services that require expansion or diversification? It is not unusual to become somewhat complacent once your business is running smoothly and profitably. Checking-in with current customers regarding your products or distribution channel can often provide a fresh perspective and insight into changes that may be required. Perhaps you may need to expand your customer base or introduce new products or services. New offerings frequently add value and promote increased sales.
Leverage Customer Input
Survey your customers regarding quality of services or simply ask for their feedback. This is an excellent way of tapping into changing market dynamics, as well. When you connect with your customers, you discover more about their changing needs and gain publicity that is more valuable than that gained from conventional promotional and advertising efforts. Additionally, customer input can assist you in determining whether or not your business is equipped to manage increased demand in products or services.
Modify your operations
Depending on how much you wish to grow; you may want to expand your operations. If you have a small core team, consider hiring additional resources or investing in technology that will allow you to manage increased business. If you determine that you need a specific, significant function, you may want to outsource it entirely. Outsourcing often provides a cost effective solution to managing non-core functions so that you can focus on areas that require your attention, such as strategy development, marketing plans or budgeting.
Incorporate emerging technologies
Leverage the Internet for promotion and advertising, instead of relying on conventional print and electronic media. Evaluate your target audience and the mediums they most likely use. Consider using social media platforms such as Facebook, Linked In, and blogs. Keep your communication messages targeted and make certain your content is relevant to your audience, as well as the social media platform you are using. If you’re addressing a younger audience, craft your content accordingly.Take Your Small Business to the Next Level
If your company is positioned to leap into the next level, and professional growth and expansion is what you are now facing, accounting and financial accuracy takes on an even more critical role. Clean and detailed financials will help to:
Maintaining clean books should be an innate part of your business practices. For most small businesses, this translates into taking time off from the daily routine of attending meetings and working on client deliverables, in order to sit down to assess where they are financially and focus on bookkeeping.
However, unless you truly understand the nuances of accounting and finances, this may best be left to an expert. Working with an expert ensures that the entries are completed in a disciplined manner. As your business grows, tax preparations and filings may become complicated. Unless you work with an expert, you will be forced to take time out of your client work to perform these functions. If you’re “self-taught” as opposed to having undergone professional training in financial management, these tasks could also take longer to complete than if they were given to an expert.
The Hewlett Packard-Autonomy Controversy
You also need to keep your books clean to avoid IRS-related scrutiny. Corporate giant Hewlett Packard (HP) was in the news a while back for its purchase of Autonomy, a software company. HP claimed an $8.8 billion dollar write-down because of the deal, which cost the company $11.1 billion. A write-down is when an asset is deliberately shown as decreased in value. This is done when the asset has overshot its market value or is overvalued, compared to prevailing market rates. Write-downs can reduce a company’s tax burden. HP also claimed that it was accounting errors that resulted in $5 billion of the write down. The founder of Autonomy stated that HP was aware of some of their accounting practices, but he also believes the controversy lies in different accounting standards adhered to in the US versus those in other countries.
Trust and transparency
The HP/Autonomy example supports the point about the necessity for accuracy and transparency in financials. Small and mid-sized businesses depend on goodwill and client trust. Regardless of differences in accounting standards or other technical industry-specific requirements, clean finances are an essential ingredient to any size business. Most small or mid-sized businesses cannot afford such controversies, or they would simply fall out of existence!
As a business owner, if your company’s goal is growth, clean accounting books might help propel you to the top!The Importance of Keeping Your Financials Clean
Decision-making is key to growing a business. For any small business, regardless of its industry, decision-making is what will ultimately determine the future of the business and the direction it takes.
Why a CFO in particular?
Accounting and financial management play a large role in business decision-making. For this reason, it is vital that your accounts and bookkeeping are as accurate and reliable as possible. Once you ensure that financial reports are all in order, it depends on a person with relevant experience and professional expertise to translate the data into information that actually helps with the decision-making process. Your CFO can help your business in various ways, from interpreting figures, to goal-setting on the basis of KPIs, to formulating budgets and forecasting effectively.
Consider the need for a CFO role in any business, particularly within these areas:
Budgets are by far the most important aspect of business growth and a CFO can help to not just formulate realistic budgets, but also help with budgeting forecasts. Budgets are not just about allocating funds to different needs of the business, but also about operational costs and expenses, funds needed to procure essential infrastructure and manpower, start-up costs, and even expected income and revenue.
ACFO will be able to help out in all of these areas, as well as guide in areas of projection and cost estimates.
Cash flow management
Cash flow is the best indicator of how much cash you actually have. Your CFO should be able to guide you better on effective cash flow management. This means paying off dues without incurring interest and recovering money owed to your business by customers. All of this helps you keep track of available cash so you can ensure smarter business investment.
Financial Analysis (Get Complimentary Analysis Now)
Financial modeling, including capital budgeting, management decision-making, and cost of capital calculations are all functions of the CFO role. Each of these activities influences the growth strategy of the small business. While software definitely exists to help with these activities, accurate interpretation of the figures can only be performed by qualified professionals, who will ultimately drive the financial decision-making process.
Bringing it all together
The CFO brings together the CPA and management information to make effective business insights. However, for a small business, it may not always be easy hiring a CFO or CFO-level expertise. Most of the time, the costs associated with such a hire are prohibitive and unaffordable for a small business or a startup.
However, a CFO role is not easily substituted without hindering the growth prospects of a business. Therefore it is better to outsource the responsibility. In outsourcing, you not only ensure your business is guided by the expertise needed, you also bring about higher profitability through better management.
At Analytix Solutions, we assist small businesses and companies in growth and expansion through better accounting practices and informed decision-making. For more information on our services, please visit us at www.analytixaccounting.com or email us at [email protected].The CFO’s Role in Formulating Small Business Growth Strategies
For any company, solid financial management practices are necessary to ensure profitability. As a business owner, where should you focus your efforts – on client deliverables, or on managing your revenue well? CFO services could be a solution to that issue.
Management of Funds
CFO services involve a careful scrutiny of your accounts, including profits and losses. Although this may sound obvious, it is easy to neglect regular account-keeping especially when your focus may be on meeting client requirements. Managing funds is an indispensable part of generating profits. Profitability does not come only from your customers. Practices such as managing costs, reducing unnecessary expenses, and enhancing productivity also play an active role in increasing your profits.
CFO services provide a detailed scrutiny of your revenue sources, revenue generation methods, and costs associated with revenue generation to determine areas that may be leading to decreased profitability. At a minimum, you should be able to answer the following questions about your finances:
It is important to note that while overhead is necessary for a business to function, it may not be directly involved in revenue or profit generation. Thus, your travel expenses, phone bills, and client entertainment could all be categorized as overhead expenses. However, controlling overhead is not the only way to reduce costs; in fact, cutting too much overhead could negatively impact your revenue stream. For example, if your business offering is such that it requires significant client interaction, then reducing client entertainment overhead expenses may not be the best option for you. Professional CFO services can help you decide if your overhead requires curtailing or not; and if it does, you have access to the expertise to advise you in deciding on how much you need to reduce your expenses.
Each time you present a client with an invoice for services rendered, it means your customer is yet to pay you. Unless there is a very strict policy for Cash on Delivery, it is highly likely that a business incurs several invoices per day, amounting to a significant number per month. Each invoice represents customers who are debtors of your company. A collection of these invoices, or a list of your debtors, can be termed as a statement. A statement also contains other details, such as amount owed, date, and amount paid. Debtor aging is an important aspect of this statement. Age here refers to the amount of time a debt has remained unpaid.
When you hire professional CFO services, you are better informed about the state of your company’s finances, and hence better prepared to reclaim the money. When debtor age goes beyond a limit that you fix, 30 days for example, you can contact your debtors and follow up on payment.
General Expenses Management
How do you decide whether your business is utilizing resources optimally? Or that the rates you have established for your services are competitive? When you hire professional CFO services, you are provided with informed advice on these types of questions. The CFO researches your accounts thoroughly and undertakes a detailed analysis around the general expenses incurred by your business. The professional CFO is well-positioned to guide you in managing your company’s general expenses, including taking corrective action when needed.
Outsourcing the CFO
If you are a start-up or a small to mid-size business, you do not need to hire a full time CFO. Instead, consider outsourcing this function. Ideally, investigate providers with experience managing requirements of businesses similar to yours. This will give you added leverage in the form of their experience and expertise.
Shop around before you finalize your decision on a part-time CFO services provider. Some providers also offer scalability – a big benefit for small to medium-sized businesses and startups. Scalability allows you to tap into industry-standard services and infrastructure while paying only for the services you actually use. Thus, it produces immense savings on investing in infrastructure costs and costs associated with hiring and retaining trained employees.
When you outsource your CFO requirements, you receive the dual benefit of direct profitability through smart financial management combined with savings on investment costs otherwise spent on funding a dedicated CFO position in your company.CFO Services to Improve Bottom Line
Several factors determine whether or not outsourcing specific tasks is the best option for your company’s needs. Scalability is one of these.
At the core of the scalability factor rests the theory that you only pay for what you use. This means that a small business can save a significant amount of money that would otherwise have been consumed by retainer costs. Several advantages exist to working under a scalability model:
Scalability, by itself, is a major factor in determining what to outsource and to whom. The extent to which a vendor allows you to scale back operations can also influence the decision to outsource. Other factors that influence outsourcing on the basis of scalability could include some of the following elements:
Scalability as a Reflection on the Vendor
A vendor who has invested significantly in training and coaching its manpower can ensure high returns for its clients by ensuring quality work. The combined experience of efficient automation with experienced human resources and input positions a vendor to offer relevant client solutions, consistently and repeatedly.
Analytix Solutions has extensive experience working with small to mid-sized companies to improve their efficiency. For more information on how Analytix can help your business, visit us at www.analytixaccounting.com or email us at [email protected].Scalability As A Determining Factor For Outsourcing
As with many other industries, accounting is “going online”. This is especially true for small to mid-sized companies. Fortunately, there are several software solutions on the market which are designed to simplify online accounting processes for startups and small businesses. QuickBooks, Intacct, and Sage 50 (previously branded Peachtree) are three such applications. Following is a brief comparison of these three software solutions.
QuickBooks’ parent company originally launched a software solution to assist with personal financial management. They soon recognized the need to offer a similar solution for small business owners. Today, QuickBooks is recognized as an essential tool to aid small businesses with their financial management. QuickBooks allows users to track their income and expenses, record bank information, organize tax-related information, and back-up data for business continuity planning. QuickBooks also provides some versioning on the basis of business attributes such as General, Wholesale, Retail, Not for Profit, or Contractual. They offer programs for Accountants and Professional Services as well.
Sage 50, previously known as Peachtree Accounting, is another business management software program. Like most accounting software designed for small to mid-size businesses, Sage 50 also provides options for different business sizes, such as an entrepreneurships, small to mid-sized business, and a large businesses. Sage 50 accounting solutions include:
Sage 50 solutions also offer system options on the basis of whether a business requires a full-time, dedicated, fully integrated accounting system; or one that is client or project dependent; or one that requires payroll management and necessitates the creation of budgets.
Intacct is a cloud-based solution offering options such as accounting, financial management/reporting, as well as inventory and vendor management. Intacct offers solutions customized to various industries, including accounting, healthcare, hospitality, non-profit, and wholesale distribution.
Intacct offers many options for customizing your reports, including employee time tracking and management, vendor tracking for details like inventory management and purchasing, financial solutions like multi-currency management and global consolidations, and more. However, Intacct is a bit more complex than the previous two solutions and maybe better suited to a mid-size business than to a startup, depending upon the needs of the business.
|> Simplified and accurate financial management option, and offers significant support for bookkeeping and accounting functions such as batch entries, which save time for small businesses||> Simplified and accurate financial management options. Reliable management features and multiple inventory management methods for web-based accounting||> Offers multiple features for a wide variety of industries, including mid-size businesses.|
|> User-friendly navigation system; considered top cloud-based financial application||> Logical, easy-to-track workflow and reporting features||> Customizable dashboards. Provides users with options to support their clients’ accounting needs|
|> Inventory functionality is limited, and the program poses some integration problems; however, it integrates smoothly with most third party applications||> Robust options, although the inventory management is single location defined||> Powerful program that may contain features that are more complex than those required by a startup or a small business|
No matter which solution you choose, a reliable accounting system will assist you in running your business more effectively.Accounting Systems Comparison – QuickBooks, Peachtree/Sage 50, and Intacct
Business portals seem to be the latest “buzz word”. Although for many small to mid-sized businesses with limited IT resources, the concept of a portal may seem like an expensive endeavor and one that may not be applicable to small business. Quite the opposite.
Small to mid-sized businesses stand to gain the most from portals, as well conceived and developed portals provide small to midsized companies with technology, information management, and a level of business intelligence previously reserved for larger companies. This combination enables smaller companies to compete better while still maintaining the advantage of being agile in moving the business quickly in the right direction.
Portals are often modular and can differ in the customized information they provide. Furthermore, they often involve leveraging a technology development investment by a third party, not the small business- another favorable factor. Following are 5 immediate benefits that businesses can realize from incorporating portals into their operations:
Portals often have a systematic feed of information (such as financial data) providing business owners with immediate access to critical data. This results in more accurate and expedient decision making by business owners, backed by the confidence that they are making decisions knowing the “full story”.
Portals are typically cloud based, allowing users access to the portal from anyplace with an internet connection. This promotes collaboration among remote employees, traveling sales team members, and partner companies as they can all access information needed for projects and initiatives.
Often, one concern that small to midsized businesses collectively share is that of business continuity and contingency planning. If one employee is typically the central “repository” of information- financial, reporting or otherwise- having vast amounts of information residing just with that single employee can be detrimental to the business in the event something happens to that individual. A portal allows for a centralized access to information so that multiple users share insights into key information. In addition, the portal developer or provider often maintains a secure backup system for critical data, further reinforcing the ability for business continuity in light of unforeseen circumstances, natural disasters, etc.
One feature that is extremely beneficial is the electronic document storage and management that many portals offer. This allows for remote access to templates, reports and critical documents for businesses.
Depending on the portal’s functionality and design, one element that can be extremely useful is the ability to control the level of access or privileges based on the users’ needs. For example, a company’s vendor may have one level of access to submit invoices, but the company’s CPA may have a higher permission level for evaluating financials.
Leveraging portals allows small businesses to increase work efficiencies and improve the quality of the output by facilitating access to key pieces of information and resources. Moreover, some portals can be customized to the specific needs of an industry or company, providing even more robust insights.
The team of professionals at Analytix Solutions has expertise creating web portals for use by our client base. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call us today at 781.503.9002 or email us [email protected].The Buzz on Business Portals
Regardless of company size, tax time is one of the most important periods for any business. Your CPA will need multiple documents that are readily available if you want to avoid last-minute headaches and any financial loss. More importantly, you need to make sure your paperwork is organized. Assessing your investments and other financial transactions might involve searching through significant amounts of paperwork.
Organizing this paperwork in preparation for tax time is probably one of the biggest challenges for a growing business. It can be very time-consuming. As a result, it makes sense to keep the documents ready to hand over to your CPA. To assist with this process, we have made a checklist of documents and papers that you need to keep handy for your CPA.
Invoices, Investment accounts and records of financial transaction, including bank and brokerage statements
Each transaction, whether small or big, should be tracked by a business. Income records, including bank statements, will also need to be provided to your CPA. Also, form 1099-INT, which reflects savings and interests, will be needed. Recording every transaction as well as keeping bank statements reconciled is very important.
Businesses classified as partnerships or corporations need to report income and income loss in the form of Schedule K-1. The Schedule K-1 carries details of the shares held by individuals within the corporation or partnership.
Office expenses, Rent, Interest expenses, miscellaneous related expenses
Office expenses include supplies, travel, etc. Furthermore, using your car for business purposes can make you eligible for a tax deduction. This holds true for fuel and toll expenses as well, for which you need to store receipts. You can also claim deductions on office space rental costs.
If your business employs staff, you will need to provide documents detailing their wages. State payroll return forms may also need to be updated. The Social Security website allows you to create and print W-2 forms for your employees. Total earnings need to be reported for staff with expertise or resources hired for a specific purpose. This can be completed through a 1099-MISC, which details payments to contracted staff.
Deductions can be claimed by you if your company is providing retirement plans to your employees, as well.
If your business operates out of your home, your documents for mortgage interest, maintenance and insurance can be included for deductions. For a self-employed individual, the Form 8829 can be used to claim this deduction.
Interest expense and Insurance
If you have taken a loan for business activities, money borrowed is eligible for a deduction. You will need to include the relevant documentation for this. This applies to insurance policies that have been taken to cover the business as well. You will need your insurance papers to claim this deduction.
At Analytix, we have helped scores of businesses increase profitably. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call us today at 781.503.9002 or email us [email protected].Checklist for Meeting with Your CPA
If you are searching for profitability gains for your business, concentrated efforts should be made to ensure reliable bookkeeping and accounting processes are established as these significantly impact the resulting accuracy of financial reports. However, bookkeeping and accounting functions are areas that require their own independent expertise. In most small to mid-sized companies, bookkeeping functions are relegated to an employee who is also responsible for other business functions and who may lack bookkeeping expertise or training. Bookkeeping becomes just an additional task to complete.
Options for effective bookkeeping
Several options exists which can help you better manage bookkeeping functions thereby ensuring more accurate financial records. Each of these depends on your company’s needs and requirements.
At Analytix Solutions, we offer a free analysis of your accounting system and other business processes. If you would like to learn more about how outsourcing your bookkeeping can help improve your business’ growth and profitability, call at 781.503.9002 or email me at [email protected].
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.
At Analytix, we offer you comprehensive accounting services, including bookkeeping, CFO and controllership. Our team of finance professionals offer you solutions to cover your immediate, as well as future, accounting needs.
We have noticed that while clients are well-versed with what constitutes the bookkeeping services we provide, they are uncertain about what is contained in our Controller and CFO offerings. They are also unsure about how these services can prove useful to their business. One way to differentiate is to give each of them a perspective according to time – bookkeeping is largely about historic or past data, controllership is about the present time, while our CFO services are future-oriented while reflecting the past and present.
A look at the three in detail
Bookkeeping: primarily, bookkeeping organizes transactional data into a streamlined form that can then be compiled into a summary. That summary can reflect the company’s financial position as well as profit and loss.
Financial reports and statements that are generated through bookkeeping provide you with an idea or trend of what elements affect business profitability.
Controllership services: Analytix plays an interactive role in the controller services as we guide the company’s internal resources on appropriate bookkeeping and accounting practices. Further, as part of our controllership services, we also review clients’ internal accounting staff’s work to ensure correct completion of entries, correct classification, as well as timing.
Further, we provide account reconciliation extending to all balance sheet accounts as part of our controllership services. Balance sheet reconciliation helps ensure accuracy of profit and loss statements, as well as accuracy in the correct valuation of the company’s assets and liabilities.
CFO Program: our CFO program includes the future in its perspective, while taking into account the present and the past.
As part of our CFO services, we provide our clients with tools which help them manage past transactional data while helping understand business operations better. We also offer budgeting and forecasting that enables clients to carry out advance planning for the future, including market position, profitability, etc.
The CFO program we provide contains a number of features, including:
For more information on our bookkeeping, controller and CFO level services, please email us at [email protected].
Mike Gardner is a CFO/Controller consultant on the Analytix Solutions team. Mike has over 25 years of accounting experience in CFO and Controller roles across multiple industries, including transportation, warehousing, grocery wholesale and retail, fast food operations, and manufacturing. Watch for future articles from Mike as he shares his insights and experience.