Tuesday, December 30, 2008

Outsourcing Bookkeeping Services - Benefits

In the olden days, bookkeeping was done by maintaining many account books, ledgers and journals. A large number of people were employed to do the job. Some supervisory staff were also required for monitoring the job. The businessmen would be spending much time, energy and money towards it. For a businessman, time is most important. He should not waste his precious time in managing bookkeeping. Even if we employ some person for this job, he has to supervise the accounts often.

he audit work and filing return are really tough and the accounts manager has to sit for day and night to do the job. The employer has to spend a lot of money to look after the needs of staff engaged in-house doing the job of bookkeeping. He has to provide space and meet the overhead costs for maintenance. He has to invest a huge amount for providing infrastructure. He has to train the staff to the new technologies introduced every now and then.

Now, everything has become simple. Many people prefer for outsourcing bookkeeping services. India has become a centre place for doing the work of bookkeeping services on outsourcing basis and many countries utilize the services of India. Many small and large companies are doing the job of outsourcing bookkeeping successfully. Let us see the benefits of this arrangement.
  1. First, our time is saved when the work of bookkeeping is let to an agency.
  2. Second thing, we need not do the hazardous job of managing staff those look after the accounts. Giving them salary, leave, insurance benefits and fringe benefits could be avoided. They is no overhead cost.
  3. The employer need not spend time and money for training the existing staff of the new techniques of bookkeeping.
  4. The space, cost of computer, hardware and software required for maintaining accounts could be reduced.
  5. The services of bookkeeping and tax return are done by the same person and the employer need not worry about filing tax returns.
  6. The work would be done as per the customer satisfaction by outsourcing company and there won’t be any delay. The outsourcing companies provide full time services.
  7. Many outsourcing companies have started giving online services also, which are really helpful for the business people. The businessman could check the progress of the work from anywhere and at any time, through online.
  8. The contacting of outsourcing companies doing the bookkeeping job has become very easy now. We could contact them by making a phone call, sending email or instant message.
  9. As the work of bookkeeping is done by an outsourcing agent, the cost of infrastructure is very much reduced and the system maintained by outsourcing company is more secure, as per agreement.
  10. Many business companies have experienced significant growth in business and the outsourcing bookkeeping service is suitable for small concerns as well as for big concerns.
The business people to withstand and grow, has to accept the changes introduced in the field. At the same time, some arrangements are available for them to simplify their day to day work such as outsourcing of certain jobs. As there is no risk involved and they could concentrate well in business, outsourcing is really a boon. As far as outsourcing bookkeeping is concerned, the outsourcing companies are providing excellent service and their charges are nominal, compared to the expenses of engaging regular in-house employees. So, we have to welcome this change, as many persons are getting employment in this job.

I am a freelance writer writing articles, short stories, poems and tips for magazines and many of my works are published in magazines. I am getting appreciation from known and unknown people also. From my schooldays, I have got the passion in reading and writing. I have won many prizes while studying in school and college. I want to improve my writing talent. Hence, I wish to submit articles through this website. I get appreciation daily from many people on seeing my articles in this website.

Article Source: http://www.saching.com

Monday, December 29, 2008

Year-End Tax Tips for 2008

Tax time is here again. Get out your calculators, organize your receipts and take note. Here are some last-minute tips to help you minimize the pain.

Bad for Investors, Good for Taxes?

The bad news is that most investors are down big this year. The good news is that you can apply up to $3,000 of your losses to offset your taxable income AND carry forward any losses in excess of $3,000 for future tax years. Keep in mind, if your losses are in your 401k or IRA -- you cannot claim the $3,000 loss on your tax return. The credit is only available to you if you actually sold any of your investments.

Tax Breaks for Homeowners

There are three new provisions which could translate to a savings for homeowners. As you may recall, Congress passed a housing bailout bill this past July. If you recently purchased your home—within the last year—you may be eligible for a tax credit of up to $7,500. The credit was put in place to give new homeowners an extra helping hand with their mortgage.

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Sunday, December 28, 2008

Accounting for software companies: Time to bring about uniformity and consistency

With the revolution in Information Technology, software companies have seen unprecedented growth in the last twenty years with companies offering IT-based solutions in diverse areas of business activities. Software companies are providing customized solutions for companies world over, automating the business operations and making the processes efficient, user-friendly, cost-effective, time saving bringing about a complete metamorphosis in the way business is conducted.

Accounting for software companies bringing about this change is a new domain for most of the economies across the globe, throwing challenges before the accounting standards supervisory bodies to formulate policies and guidelines for these companies so as to correctly reflect the overall health of these firms from different perspectives.

Software companies are involved in various activities in the process of providing solutions for their clients. There are business transactions of different nature carried out by these firms at different stages, and a policy statement prescribing sound accounting for software companies requires taking care of all these business transactions that the companies are involved in at every stage of the project development and execution is very essential. The most important issue concerning Accounting for software companies is the way these software companies book income from software products developed by them and the various IT services supplied to customers.

There are also problems of inconsistencies in accounting standards related to these companies if they are operating at a global level. For instance, as per US rules, revenue can be included in a company’s accounts only after software and services have been supplied in full, whereas a UK company can book revenues for supplying services even before the work is finished. This implies that a company based in Britain, but listed in US Exchange and filing its accounts under the US rules, will be substantially overstating its UK gross margin or revenue. Multinational companies may find it very hard to comply with dual standards. Sometimes, these inconsistencies are so sharp that a company may have to break the basic spirit of one accounting standard to comply with the other.

There are a number of issues that are interpreted differently by the companies to report their profits or losses on accounting books. There are some companies that capitalize their software development costs and there are others who expense these development costs. Moreover, aprt from the Research and Development costs, which are always reported separately in financial statements, most other intangible investments go unreported, such as employees training, brand enhancement, information technology investments, etc. Thus, there is a complete lack of transparency in case of most intangible investments, and this is true not only in United States, but in different degrees worldwide. Accounting for software companies must take care of this issue to bring about more transparency in the system.

Alvis Brazma gives advice to business owners about how to manage their business efficiently without any hassles. To know more about accounting outsourcing, retail accounting, Accounting for software companies, small business accounting and accounting help visit www.impacctusa.com

Source : http://www.bestsyndication.com/

Friday, December 26, 2008

No accountability? Then no more bailouts

Through the blind generosity of Congress and the Bush administration, some of the nation's largest banks have been bestowed with billions of dollars from taxpayers. So is it too much to ask banks for an accounting of how such largesse is being used?

Yes, says an Associated Press survey of 21 banks that received at least $1 billion in federal money.

The AP reports that not a single bank would provide specific answers. What's worse is that they don't have to. There is no process to compel the banks to disclose how they're spending the money.

A congressional oversight panel can't get the administration or Treasury Department officials to explain what it's doing or its strategy in giving out the nearly $350 billion released so far for the program.

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Tuesday, December 23, 2008

Business Record Keeping Basics

As a business owner, you may rely on an outside accountant to do your taxes and prepare financial statements. However, it’s best that you or someone in your organization take on the responsibility of keeping an accurate set of financial records.

Keeping good records yourself, no matter how unpleasant it may seem, will minimize the costs of paying an accountant and allow you more control of your financial information and operations. Maintaining good records can also help you avoid headaches at tax time by keeping track of your receipts and other records throughout the year. This can help you remember the various transactions you made during the year so you can properly document and maximize your tax deductions.

Normally, tax records should be kept for three years, but some documents - records relating to a home purchase or sale, stock transactions, IRA and business or rental property - should be kept longer.

Good record keeping not only enables the IRS to evaluate your business activity through original and supporting documents, but it also gives you the information you need to properly manage and grow your business.

You can keep track of your business transactions by writing them down, usually in books such as journals or ledgers or by typing them into a computer software program. It’s best to choose a system that’s simple, yet can be changed to meet your needs in the future. An accounting system should show your income and expenses and can be easily understood, especially by you. If you have more than one business, it’s best to keep completely separate books for each type of business activity.

The two basic types of bookkeeping methods are single entry and double-entry systems. Whether you choose to keep a written ledger or use computer software, record only the information that needs to be documented.

Single-Entry Bookkeeping

Single-entry bookkeeping uses a cash receipts journal, a cash disbursements journal and also the use of a checkbook. All business transactions are recorded in one of these journals. It is a practical bookkeeping system for small businesses that are just starting.

The cash receipts journal should contain a record of all the money that you receive. It should contain a column for items such as date, amount, and source of payment, the reason for the payment or anything that is of importance to your bookkeeping and of relevance.

Document the money that your small business spends in a cash disbursements journal. It should have columns for the various expenditures that your small business may have with a line for each expenditure, including description of expense, date, payee, check number and total amount.

Double-Entry Bookkeeping

As your business grows, you may need to adopt a double-entry bookkeeping system. This system provides more information to paint a more complete picture of your business at any particular point in time. This information may include available cash on hand, accounts payable, utilities, loans, etc.

Your small business should use a double-entry bookkeeping system if has significant accounts receivable, accounts payable, equipment that depreciates or inventory. If your business will meet any of these, you should select a double-entry system from the start. You’ll use journals and ledgers to record information that reflect your business transactions.

Each transaction will be recorded twice, meaning the system will balance itself out. For example, if you make a loan payment, you will decrease the cash amount in your cash account and increase the exact amount in the expense account.

What Type of Records To Keep

The type of business you operate generally affects the type of records you need to keep for federal tax purposes. You’ll need supporting documents to capture important details, such as your receipts, purchases, expenses, assets.

Here are some other basic record keeping tips to keep in mind:
  • Daily business records are the best
  • Identify source of receipts
  • Record expenses when they occur
  • Keep complete records on all assets
Remember, good record keeping is essential to the financial survival of your business. So take the time to keep good records, so you can run your business successfully — instead of it

Copyright 2005 Kate Smalley, Connecticut Secretary Freelance Secretarial and Transcription Services http://www.connecticutsecretary.com mailto:kms@connecticutsecretary.com

Monday, December 22, 2008

10 Year-End Tax Tips

As the end of the calendar year approaches, you should take some time to focus on your taxes. There are several things that you may be able to do to lower your bill.
  1. Review your income, expenses and potential deductions: Before you can make any adjustments, you will need to look closely at how much you are earning, spending, and saving and what you can deduct.

  2. Review your portfolio: If capital gains are high, consider taking a loss to offset some of the capital gains income.

  3. Defer income: Unless you have reason to believe that next year will bring you a higher income and move you into a higher personal income tax bracket, you may want to defer income until after the first of the year. If you are self-employed, for example, send the last invoices out late in December so you will more likely receive payment in January.

  4. Use up your flex spending plan: If you have a flexible spending plan, which means you have put aside tax-free earnings to cover medical and dental expenses through a plan offered by your employer, you need to use it up. Make doctor appointments now and buy necessary medical supplies that are covered in the plan.
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Sunday, December 21, 2008

Take your business places with accounting outsourcing in India

Accounting outsourcing in India adopts various cost effective methods that actually reduces time, money and personnel resources for its clients. Moreover, several multinationals are relying on these services because accountancy in western countries cost a lot and provides them with an opportunity to grow their businesses. In fact, outsourcing has also contributed a lot in the economic growth of India as the unemployment has reduced by a large margin. Well, you can say that besides economic reasons, it is also a matter of convenience for many of the countries to opt for these services in India. The objective behind hiring services for accounting outsourcing is that it reduces their losses and at the same time maximizes the profits without any hassle. In fact, accounting outsourcing also reduces their expenses by huge margins, as hiring accountants in Europe or America costs a lot and needs huge investments. However, with the help of accounting outsourcing in India, the multinationals are able to reduce such costs.

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Friday, December 19, 2008

Bookkeeping Made Simple

Don't get bogged down with bookkeeping. Keep it simple -- and accurate -- by establishing a procedure and following that procedure each time you send out a bill or collect a payment.

Follow these steps to streamline and increase the accuracy of your bookkeeping system :
  1. Design an invoice and keep the template handy. Make spaces to fill in amounts due from clients, job descriptions, hourly rates, outstanding balances and other information. When you send an invoice to a customer, keep at least one hardcopy for your records.
  2. Set up a special checking or money market account that will be used for business purposes only. When checks come in as payment, deposit them into this account. This will allow you to simply and accurately tally your income -- quarterly and at year-end. Note: When depositing checks, record in your checkbook the customer's name and check number. This will help you if discrepancies arise in the 1099 (Miscellaneous Income) statements that customers send out during tax time.

    Use this account whenever you make a business purchase. Avoid writing personal checks from the account. Make sure that you make a note describing the business purchase. If you do make a non-business purchase from the account, make note of it so you won't be confused at tax time.

  3. If you take credit card payments, set up a special checking or money market account for this activity as well. Designate that all credit card payments spill into this account and that your monthly fees automatically be deducted from this account.

  4. If you take out business loans or establish business lines of credit, set up a special account into which the bank can deposit these funds. It's generally best not to use these accounts for normal business purposes. Your records will be clearer if you transfer funds from these accounts into your business checking account (as described in Point 2 above). This will allow you to more accurately keep records of business purchases. If, however, you will be using the borrowed funds to make only one or two purchases (such as buying a large piece of equipment), you can write the check from the account.

    Special note: When you transfer funds from this account into your regular business checking account, be sure to make a note in your business account check ledger that the deposit is NOT BUSINESS INCOME. Note the source of the deposit, the check number and the date of the deposit. This will keep your records accurate for tax purposes.

  5. Because you will be using your business checking account for business purposes only, you will need to have at least one additional checking account for personal use. When you require funds for personal expenditures, write a check from your business account. Record this check in your business checkbook as "To personal account" so you won't mistake it for a business purchase. You should write the check out to yourself. This will further delineate the check as a transfer of funds from your business to your personal account.

    If your spouse also has a checking account, follow the same procedure.

  6. Keep a savings account or a money market account that is used exclusively for collecting and storing money for your taxes (i.e., for your quarterly estimated payments). Checks for this account should be written from your business checking account, written with your name on the check and designated in your business checking account as "To IRS account" or "To tax account." Ideally, you should determine the appropriate percentage to take out of each deposit into your business checking account, and write a check for that amount to your IRS account.

  7. To back up your records and to ensure greatest accuracy, keep a separate log that details each business check you write. Items to include in the log: name of company or individual to which the check is written, details of the transaction or purchase, check amount, check number, check date and any other items of information that will help jog your memory of the exact purpose of the check.

  8. Also, you can keep a log detailing information contained in your invoices. Items to include: customer name, date of invoice, terms of invoice, details of work performed, etc. When invoices are paid, make a note on the invoice itself and in your invoice log.
Following these simple guidelines will streamline and systematize bookkeeping for your business. They will help clarify your records, both for keeping track of individual payments and for tax purposes. When your business requires a more complicated bookkeeping system, try to keep the variations simple and repeatable. Being systematic is the key to headache-free bookkeeping.

Source : http://www.nfib.com/

Thursday, December 18, 2008

Tips to Keep Your Bookkeeper Happy

  1. Keep and label all credit card receipts and give them to your bookkeeper on a regular basis.
  2. Let your bookkeeper know when you will/will not be available to sign checks and approve invoices.
  3. Keep your bookkeeper up-to-date with payroll information. This is usually a business’ greatest expense. If this information is not posted promptly and accurately it can cause quite a problem.
  4. When available, allow your bookkeeper to access your account online in order to keep books up to date.
  5. Don't move things around so that your bookkeeper can find things easily when they return to your office.
  6. Do not hover over the bookkeeper. We are professional, trustworthy people. We are bonded. Let us do the work!
  7. Make lots of money – bookkeeping is always easier when there’s more money!

Source : http://www.bookkeepersplus.com/

Wednesday, December 17, 2008

Tax Tips For Digital Entrepreneurs

As tax season approaches, I thought it would be useful to offer some advice on taxes for those who make most of their money as online entrepreneurs. Here are five tips that I’ve found to be priceless in the long run. Hopefully, you can save time and stress with these 5 easy suggestions:

  1. Send in quarterly payments so that you don’t get stuck with a massive tax bill at the end of the year.
  2. Keep all receipts (not just ones that were obvious business purchases), determine “business expense” later. You might be surprised at what you can deduct.
  3. File receipts. File your receipts by the end of the day (trust me on this) in a folder penciled with the current month. If the ink is unclear, make a notation in dark ink somewhere on the receipt.
  4. Log business activities in a day planner. Record the occurrence of any business-related meetings in a day planner in ink, as well as in a digital file. These will help you or your accountant decide whether a particular expense is tax deductible or not.
  5. Keep a spreadsheet. In addition to daily filing of receipts, enter the information in a spreadsheet. If you don’t like or have Microsoft Excel, use OpenOffice. You could also use web-based spreadsheets like Zoho Sheet or Google Docs.
Bonus Tip 1: If you work out of your home, remember that you can deduct a nice amount for utilities (you are heating your home during the day in the winter *so that* you can work).

Bonus Tip 2: Try to keep all of your purchases on a single business credit card (not your personal card). This gives you a backup record in case the IRS comes knocking.

Source : http://www.businesspundit.com/

Tuesday, December 16, 2008

Double Entry Bookkeeping Versus Single Entry Bookkeeping

Bookkeeping stems from the recording of financial transactions and the accounting term for a business accounts as books. In effect the accounting function prepares a record of the monetary affairs of a business and stores the information in files called books. Hence the term bookkeeping often misspelled as book keeping which is the function of a librarian not that of a bookkeeper.

The difference between bookkeeping services and accounting may be unclear to the uninitiated while both are of vital importance to financial success. Bookkeeping is an important part of the accounting function and is essentially the record keeping of the financial transactions. Accounting is while incorporating the record keeping also includes the presentation, interpretation and financial control functions including interpretation of the numbers for the financial health of a business of which taxation can play a major part.

The financial affairs of a business involve many aspects and start with the recording of what is termed the prime documents. The task of a bookkeeping service is to record the prime documents, those prime documents being the sales, purchases and cash/bank transactions. All small businesses do bookkeeping and the most successful use the bookkeeping records as a basis for an accounting function to generate a more efficient financial service.

All business involves buying or selling something and the consequent function of receiving or paying money to the value of those transactions. Recording these transactions in larger business organisations is done by accounts clerks who work under the supervision of the accountant.

Invariably medium and larger businesses use a double entry system for recording transactions. Double entry accounting evolves from the fact that every transaction as a double effect on the business of which these are prime examples.

A sale is made creating a record of income for the business on which the business is taxed and the other side of the financial transaction, the double entry, is the organisation who was sold the goods now owes the value of that sales invoice to the business. That is the double entry, record the sales income and also record the debt due from the customer.

Someone who owes the business a debt is called a debtor.

A purchase is made creating a record of expense for the business which can be deducted from income and lowers taxes and the other side of the financial transaction, the double entry, is the organisation who supplied the purchase on credit is now owed the money. That is the double entry, record the purchase and also record the credit due to the supplier.

Someone who has supplied goods on credit is called a creditor.

The third type of prime transaction is the transfer of money between the debtors and creditors and the business.

When a debtor pays his sales invoice the double entry is to add that amount of money to the business financial records and the opposite double entry goes to the debtor account to reduce the amount owed to the business since it has now received the cash.

When a creditor is paid the amount owed the money is recorded as reducing the cash resources of the business by for example deducting the money from the bank balance and the double entry reduces the amount the business now owes to the creditor account since it has reduced the credit received.

The bookkeeping function is to record these prime transactions. Since every financial transaction has an equal and opposite entry in the books there has to be a mathematical check that both sides of the transactions add up to zero. This check process is called a trial balance where both sides of the entries should be in agreement and normally the point at which the bookkeeping service is deemed to be complete.

Double entry bookkeeping is required for all businesses that require to produce a statement of its assets and liabilities. This statement of assets and liabilities is the total of all the balances from the trial balance and is called a balance sheet.

Many small businesses do not require a balance sheet. In the UK the production of a balance sheet is optional for every self employed business as it is not an obligatory requirement of the self assessment tax return form. A self employed bookkeeping system is not required to produce a balance sheet because the business effectively belongs to the owner and is that owners personal business.

Limited companies must produce a balance sheet under various financial acts and submit the balance sheet to both Companies House and the tax authority each year. The different rules applying to a limited company is because the accounts including the balance sheet are public records available to the members of that company and not necessarily the property of a single individual or partnership.

The self employed bookkeeping system can be simpler being produced from a single entry style of bookkeeping rather than double entry. Single entry bookkeeping makes a single entry for each financial transaction which is sufficient to produce an income and expenditure account, a profit and loss account, but does not make the reciprocal entry that establishes the value of the assets and liabilities.

Single entry can be as simple as making a list of the sales income and the purchase expenses. Such a bookkeeping system is valuable to the smaller business as it requires little or no bookkeeping or accounting knowledge. A smaller business can produce its own accounts without the need for a bookkeeper or accountant particularly if it has access to bookkeeping templates through bookkeeping software to produce the accounts in the accounting format required.

About the author :
Terry Cartwright is a qualified accountant in the UK designs Accounting Software on excel spreadsheets providing complete Small Business Accounting Software solutions for with single and double entry Bookkeeping solutions for limited companies and self employed business

Monday, December 15, 2008

Tax Planning - Top 10 year-end tax planning tips for investors

There are several important tax-saving initiatives that must be carried out before Dec. 31 in order to get the benefit for the 2006 tax year.

Here are 10 in the investment area that need to be considered as soon as possible since they may take some planning and possibly a visit to your tax accountant.
  1. Invest in a resource tax shelter, which will allow you to deduct your full investment against other income in 2006. If you have a 46 per cent marginal tax rate, a $10,000 investment would cost only about $5,400 after tax, although the investment would be tied up for a couple of years until the tax shelter is converted into mutual fund units. Resource tax shelters have been around for decades and are sanctioned by Canada Revenue Agency, whereas most other shelters carry the risk of being declared invalid even if they have a tax number.
  2. Donate stock instead of cash to a charity to get a special tax break. Normally, half of a capital gain is taxed as income, but under new rules, a capital gain triggered by a donation of securities or mutual fund units to a charity is exempt from tax.
  3. Defer any sales of assets that would yield capital gains until 2007. That way, you will not have to pay income tax on the gains until you file the 2007 return in 2008.
  4. Book losses on stocks and other securities held outside of registered plans. Tax rules allow this year's losses to offset this year's capital gains and any remaining losses can be carried back and applied against any capital gains in the preceding three years or carried forward indefinitely. Investors should keep in mind that to get the tax loss, they can't buy the same security again, either in non-registered or registered accounts, until 31 days after the sale.
  5. Make an RESP contribution before year-end to get the Canada Education Savings Grant (maximum of $400 or 20 per cent of your contribution up to $2,000) for 2006. If you are just setting up a RESP, keep in mind that you will need a social insurance number for the child to get the grant and this could take several weeks to obtain.
  6. If you are planning on making a spousal RRSP contribution, do it before Dec. 31. Contributions made before year-end instead of in January or February will reduce the withdrawal waiting period. The spouse will be able to withdraw the funds in 2009 without attribution to you. If you wait to make the contribution in 2007, the three-year waiting period won't end until 2010.
  7. If you are turning 69 in 2006, you have to convert your RRSP into a RRIF by year-end. When setting up the RRIF, you can base the withdrawal schedule on the younger spouse's age, thereby minimizing the withdrawals and the taxable income they generate in future years.
  8. If you must set up a RRIF in 2006 and if you also have employment income, you can still make an RRSP contribution and get a tax refund next April. The contribution has to be made before your RRSP ceases to exist at year-end and it is technically tricky to do, since you are not supposed to make RRSP contributions on this year's employment income until 2007. However, the over-contribution penalty you will pay for a short time will be small compared with the income tax refund you will receive.
  9. If you are past the age of 69 and still have employment income, contributing to a spousal RRSP (which must be done before year-end for spouses who turn 69 this year) is another way to defer taxes.
  10. Avoid investment in mutual funds in your non-registered account prior to year-end in order to avoid being stuck paying taxes on gains you haven't benefited from. This unfortunate situation arises because Canadian tax rules provide that all capital gains taken within a mutual fund during 2006 will be attributed to those holding the mutual fund units at year-end.
Wayne Cheveldayoff is a former investment advisor and professional financial planner. He is currently specializing in financial communications and investor relations at Wertheim + Co. in Toronto. His columns are archived at www.smartinvesting.ca and he can be contacted at wcheveldayoff@yahoo.ca.

Sunday, December 14, 2008

Outsourcing Bookkeeping Frees Up Time to Grow Your Business

The onslaught of avant-garde technology today has found many scrambling to internet based services. From medical help to mortgage refinance and now outsourcing of bookkeeping and financial services are available online. This way business finds it cost effective and very efficient.

A detailed representation of the business accounting functions is painstakingly done by the professional accountants of the outsourcing firm. Virtually what the client has to do is merely fax or scan his documents and submit and bookkeeping is made simple. The professional help automatically takes out most of the hard work out of bookkeeping.

Bookkeeping could be server based. If the client does require that his accounts books be maintained in his own computer, the outsourcing bookkeeping connects to the client’s computer through the internet. This is done with the use of remote desktop access services. Then in the morning the client will find his books updated and simplified in his computer. This means that the client gets financial statements, reports, checks, sales invoices, and others on his own computer ready to print. This he can conveniently do without having to log in to any website and be bothered by the hassles that go with it.

Bookkeeping, by its inherent nature, necessitates a lot of paper work. It seems like the work is almost always never done on time. Accounting data entry, payroll preparation, cash flow, bank and credit card reconciliation, trial balance, accounts payable management and other bookkeeping tasks which need updates every month can be reorganized and restructured in few very easy steps. Completion of the project is within the time frame given and the cost does not go over the budget.

Outsourcing bookkeeping has different processes options to update your books. There is a wide array of options available where you can choose according to your requirements as to what is best for working conditions. The client also gets to choose the process option that he finds most efficient and the compatibility of resources in his environment.

The processes the client could choose from for outsourcing bookkeeping are Remote Access Based, Hosted Software Based, Server Based and Online Options. These are some of the processes that would suit your necessities and your convenience.

Another option is for the client to send the documents either by having them scanned or through fax. The bookkeeper logs on using an online service overnight. With the help of the software, she starts to update your books, and when done logs out. While you can take a look at your books the next morning and everything is already done!

The degree of security and protection in place is the highest available today. Information is treated as confidential and sensitive. Privacy is considered of utmost importance. That is why the best of encrypted technology is employed to make sure that there is no infringement committed on your data. Only authorized bookkeepers and accountants have access to client’s documents and books.

Outsource your bookkeeping today; and focus on those functions of their businesses that really matters for its growth.

Source : http://www.streetdirectory.com/

Friday, December 12, 2008

Lower Tax Bills And Bookkeeping For Small Business

Tax authorities are often relaxed about the need for small business to prepare and produce formal accounting records. Often the requirement is simply that each business retains sufficient financial records to support the accounts submitted.

Such advice from tax authorities places a burden upon small business in that the vast majority are honest hard working people who are meticulous about keeping accounting records of sales made during the financial year. Unfortunately many small businesses are not so meticulous about keeping financial records of business expenses in their accounts.

A typical taxi driver may for instance keep a diary and record the daily receipts from his fares. If those recorded receipts are accurate then the total sales turnover for the year will show the correct total. The same may not be true of expenses and the accounts thereby overstated.

The total business expenses of the taxi driver would mainly include the fuel receipts plus the other running costs of the business. Typically a receipt for fuel will be obtained and kept in a file or shoe box. Some may get mislaid and lost and be missing from the final accounts preparation.

Other receipts for miscellaneous items may not even be retained as forgotten, lost or not thought of at the time of purchase. Examples may be purchase of the diary in which sales records are kept, business cards, other stationery, and cash payments for a whole variety of miscellaneous items.

The same practise is also often applicable to not just taxi drivers but many small businesses.
A small business owner may visit a supermarket for groceries and also buy an item of stationery for business use the cost of which is lost when the grocery receipt is discarded. If close attention is paid then the stationery item could have been obtained on a separate receipt and the cost of the journey to purchase it also included in the business expenses.

The stationery item is just one example which could be multiplied hundreds of times with hundreds of different items during the financial year. While each item missed and unrecorded may not be significant the total could well be sufficient to significantly reduce the year end tax burden by lowering the net taxable accounting profit.

Having retained a separate receipt for everything it is useful if the receipts are filed and the bookkeeping system employed updated at least once a month and preferably each week. By updating the accounting records on a regular basis more expenses will be recorded as the memory will remember recent expenses more clearly and accurately.

Another useful method to ensure all business expenses are maximised is to keep a daily diary of all expenses incurred. Use the entries in the diary when updating the bookkeeping records to ensure nothing has been missed in the accounts.

The essential message is to be meticulous about keeping receipts for everything, no matter how small, and recording both income and expenditure on a regular basis so that items are not lost or forgotten and included in the bookkeeping records. By also keeping a diary of financial records even if a receipt has been mislaid the amount should still be included in the accounts. It could be disallowed later if the tax records are enquired into but that is a matter of negotiation with the tax authority from a standpoint where the financial records are correct.

In addition all small business should take some time to review all potential expenditure which can be claimed under the tax rules. Many valid expense items can be missed having been dismissed as ordinary expenses which may be business related and therefore claimable in the financial accounts.

Author Resource:- Terry Cartwright is a qualified accountant in the UK designs Accounting Software on excel spreadsheets providing complete Small Business Accounting Software solutions for with single and double entry Bookkeeping solutions for limited companies and self employed business

Article : Talkinmince Article Directory

Thursday, December 11, 2008

Double-Entry Bookkeeping

Double-entry bookkeeping is an accounting technique that records each transaction as both a debit and a credit, thus making it easier to double-check your financial transactions. To illustrate:

You conduct a sale but do not collect the payment.
  • Your receivables would increase.
  • Your sales revenue would also increase.
You buy from a supplier on credit (you do not pay them right away).
  • Your payables would increase.
  • Your inventory would also increase.
Let’s say you buy an asset and pay immediately.
  • Your assets would increase.
  • Your cash would decrease.
These are just a few examples, there are many other types of transactions found in double-entry bookkeeping. Each change in one account must be balanced with a change in another account. You might have heard of bookkeepers trying to “balance the books”; this means that the bookkeeper is trying to find a change in one account that balances a change made in another.

The double-entry method is based on the following accounting logic: Assets = Liabilities + Equity
If there is a change in one side of the equation, there should be a change in the other side to balance the difference. Or, if there is a change in one side, there should be an opposite change on the same side. For example:

If assets increase (you buy equipment), there should be a decrease in assets (cash) or an increase on liability (you bought the equipment with borrowed money). If you enter a decrease in cash or an increased liability, you will balance out the increase in assets.

The double-entry method of bookkeeping can get confusing, especially if there are many transactions taking place in your company. If your company keeps inventory and does purchases and sales on credit, the books might get very hard to maintain. Luckily, thanks to accounting software, keeping accurate records is much easier, and, due to the limitations created into the software, it will not allow you to make an entry that is not “balanced.”

Source : http://gaizer.com/

Wednesday, December 10, 2008

Online Bookkeeping Course FAQ

Can I Complete a Distance Learning Class in Bookkeeping While Working a Full Time Job?

Classes from accredited universities offer a great deal of flexibility for people who lead busy lives. Many people complete distance education classes while working full time or raising a family.

Will My Employer Pay for Me to Complete an Online Bookkeeping Course?

Many companies will pay for classes or provide tuition reimbursement to employees who complete distance learning classes. Tuition reimbursement usually takes place after completion of an online bookkeeping course. Many companies require that employees maintain good grades in their distance education program to be eligible for reimbursement. Check with your employer to find out the specific terms of their tuition reimbursement program.

How Often Are New Bookkeeping Courses Online Offered?
Distance education classes take place on an ongoing basis. Job skill training often starts directly following student registration. Check with the individual accredited colleges of interest to find out more about class times and schedules.

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Tuesday, December 9, 2008

Bookkeeping and Accounting - Basic For Your Help

Learn the basics of accounting and bookkeeping for your small business.

Many new business owners are daunted by the mere idea of bookkeeping and accounting. But in reality, both are pretty simple. Keep in mind that bookkeeping and accounting share two basic goals:
  • To keep track of your income and expenses, which improves your chances of making a profit, and
  • To collect the financial information necessary for filing your various tax returns.
There is no requirement that your records be kept in any particular way. As long as your records accurately reflect your business's income and expenses, the IRS will find them acceptable. (There is a requirement, however, that some businesses use a certain method of crediting their accounts: the cash method or accrual method. For more information, see Cash vs. Accrual Accounting. )

Depending on the size of your business and amount of sales, you can create your own ledgers and reports, or rely on accounting software.

Three Steps to Keeping Your Books

The actual process of keeping your books is easy to understand when broken down into three steps.

  1. Keep receipts or other acceptable records of every payment to and every expenditure by your business.
  2. Summarize your income and expenditure records on some periodic basis (daily, weekly, or monthly).
  3. Use your summaries to create financial reports that will tell you specific information about your business, such as how much monthly profit you're making or how much your business is worth at a specific point in time.

Whether you do your accounting by hand on ledger sheets or use accounting software, these principles are exactly the same.

Step One: Keeping Your Receipts

Each of your business's sales and purchases must be backed by some type of record containing the amount, the date, and other relevant information about that sale. You'll use these to create summaries of your transactions.

From a legal point of view, your method of keeping receipts can range from slips kept in a cigar box to a sophisticated cash register hooked into a computer system. Practically, you'll want to choose a system that fits your business needs. For example, a small service business that handles only relatively few jobs may get by with a bare-bones approach. But the more sales and expenditures your business makes, the better your receipt filing system needs to be.

Step Two: Setting Up and Posting to Ledgers

A completed ledger is really nothing more than a summary of revenues, expenditures, and whatever else you're keeping track of (entered from your receipts according to category and date). Later, you use these summaries to answer specific financial questions about your business, such as whether you're making a profit and, if so, how much.

Post receipts on a regular basis. On some regular basis -- like every day, once a week, or at least once a month -- you should transfer the amounts from your receipts for sales and purchases into your ledger. This is called posting. How often you do this depends on how many sales and expenditures your business makes, and how detailed you want your books to be.

Your posting schedule depends on your sales numbers. Generally speaking, the more sales you do, the more often you should post to your ledger. A retail store, for instance, that does hundreds of sales amounting to thousands of dollars every day should post daily. With that volume of sales, it's important to see what's happening every day and not to fall behind with the paperwork. To do this, the busy retailer should use a cash register that totals and posts the day's sales to a computerized bookkeeping system at the push of a button.

A slower business, however, or one with just a few large transactions per month, such as a small website design shop, dog-sitting service, or swimming pool repair company, would probably be fine if it posted weekly or even monthly.

If possible, use accounting software. You can purchase an accounting software program that will generate its own ledgers as you enter your information (and then automatically generate the necessary financial reports from the same information). All but the tiniest new business are well advised to use an accounting software package to help keep their books. Micro-businesses can get by with personal finance software such as Quicken.

Step Three: Creating Basic Financial Reports

Should I report expense reimbursements as income?

Financial reports are important because they bring together several key pieces of financial information about your business. Think of it this way: while your income ledger may tell you that your business brought in a lot of money during the year, you won't know if you turned a profit without measuring your income against your total expenses. And even comparing your monthly totals of income and expenses won't tell you whether your credit customers are paying fast enough to keep adequate cash flowing through your business to pay your bills on time.

That's why you need financial reports: to combine data from your ledgers and sculpt it into a shape that shows you the big picture of your business. The key reports you need to create regularly are a cash flow analysis, a profit and loss forecast, and a balance sheet.

Source : http://www.nolo.com/

Monday, December 8, 2008

Why should I start a Bookkeeping and Accounting Business?

Building an Accounting and Bookkeeping Service with the marketing plan presented in the Professional Bookkeeper program, you will learn to earn an average of $300 per month PER CLIENT! Working full-time, you can earn $80,000 per year

Every Business Must Do Accounting

Not only is it to a business' advantage to do accounting, it is required by law. Every business must account for profit and loss, expenses, payroll, and many other accounting activities. What's more, most small businesses want to focus on growing their business, not on bookkeeping processes and accounting reports. By you taking over their books at a very profitable rate for yourself, you are freeing business owners to do what they really want, to grow their business and focus on making sales.

Be Your Own Boss and Set Your Own Hours

Starting your own accounting and bookkeeping business gives you the flexibility to set your own hours and make time for what matters most to you. If you would rather play a round of golf or take a trip with family today, that is your option. Many of our graduates have expressed how much that they love the freedom of working when they want, often even from the comfort of home. Working in your pajamas likely isn't how you would like to do your business, but isn't it nice to know you could if you wanted.

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Sunday, December 7, 2008

Tips to help your home-based business survive

With a hefty commute from large employment centers in Phoenix, many Surprise residents are creating their own employment closer to home. The city counts more than 800 home-based businesses, a segment that is among the fastest-growing assets of the city's economy, Surprise Economic Development Director John Hagen said.

Others have recognized that growth. In September, Maricopa Community Colleges and the Small Business Administration opened their first Small Business Development Center in the West Valley, in Surprise. Hagen said fostering that entrepreneurial culture is necessary in order to attract large, corporate employers in the future.

Home-based business activity in Surprise is likely to increase. According to business consultants, a slow economy and layoffs is a popular time for workers to explore the option. David Moss, director of the West Valley SBDC office, offers this list of things to consider for aspiring home-based business owners:

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