Every business is required to keep bookkeeping records to produce at the end of the year (Calendar or Financial) a set of accounts to show the business expenses, sales income and the net profit for tax purposes. New businesses in particular, self employed businesses have a choice in how the financial accounts are prepared and produced. Many of these businesses for financial reasons tend to either keep a manual record of financial transactions or purchase an off the shelf software program from their local retailer and then on their own develop a charter of accounts and complete the data entry.
There are several advantages and disadvantages to whichever course of action a small business may take to produce the financial. But, at the end of the day, the condition of financial accounts and the financial control that are put in place will dictate how well or badly the business is performing compared to the success in the business environment. The underlying necessity is that if the business does not take a decision on its financial accounting then at the very least it must accumulate documents of prime significance such as sales invoices, purchase invoices and possibly bank records during the financial year and assemble these into some sort of order after the end of the financial year for tax purposes. Failing to keep financial records often results in a succession of administrative burdens and often also leads to financial penalties if taxation
deadlines are not met.
If the small business owner chooses not to go down the route of using bookkeeping software or outsourcing the financial function to a bookkeeper or accountant then manual financial records must be kept. Producing an income and expenditure account for the business using the prime financial documents of business is not rocket science and most businessmen capable of running and managing a business have the skills required to producing the bookkeeping records. The major disadvantage of a small business keeping manual records is that documents get lost which may result in profits and taxes being over declared, fines and penalties through inaccuracies and often when accounting is produced in this way it is done at the end of the financial year purely for tax purposes rather than as an essential tool of the business and that reduces financial control within the business during the financial year to a minimum and often zero.
If a manual bookkeeping system is adopted then disciplined recording of the financial information on a regular basis should be enforced and regarded as an essential function and not an administrative burden. The main purpose of regular accounts being to both see and understand the financial position of the business and take positive action as required at the earliest opportunity to achieve a satisfactory financial result.
Other alternatives include utilizing bookkeeping software which is effectively often a manual system in itself but within definite parameters to produce the essential information. Using bookkeeping software has many advantages. First of all any small business that has purchased bookkeeping software is more likely to keep regular up to date accounts than one that has not. And secondly the bookkeeping software is likely to provide a fixed set of disciplines and produce the type of records a small business requires for both the preparation of regular financial statements and the end of year tax returns. Another major advantage of bookkeeping software is that records tend to be less likely to be lost or mislaid; the packages can be backed up as required but essential financial performance can be improved by greater financial control. All businesses work towards producing a satisfactory bottom line and only by producing regular financial statements can the business obtain the earliest information to achieve that satisfactory performance.
Bookkeeping software comes in many different formats from simple spreadsheets to more complex data based accounting software. For a small business the bookkeeping software of choice is often a simple system requiring limited accounting knowledge but must also be a package that produces the desired end result. The worst bookkeeping software is a complex program requiring prior accounting knowledge that the small business either does not fully understand, cannot be bothered or does not have the time to learn and having tried the system then abandons it. Such a process just causes frustration and time to start again with a different solution. Bookkeeping software in effect automates the manual keeping of financial records. To get the most benefit from a bookkeeping software package each small business should prepare regular financial records to enhance and improve financial control, take financial decisions and achieve the desired bottom line result.
Bookkeeping can be outsourced to an accountant or bookkeeper and there advantages in doing so. The financial records are generally maintained in good order and regular financial reports produced. If the small business has a volume of paperwork that becomes a burden to process and keep on top of then a bookkeeper is the best solution. Employing a bookkeeper becomes essential when the paperwork burden reaches a stage when it distracts the small business owner from getting on with the main task of operating the business. A bookkeeper has to be paid and that cost should be viewed as the cost not of producing the financial records but as the amount to be paid to release the time of the small business owner and also to produce the financial statements on which action can be taken to improve profitability.
In conclusion each small business should evaluate their options and time commitment. A manual bookkeeping system may suffice but the business may be better served using bookkeeping software & services to increase financial control and performance.
15 years of Fortune 1000 Consulting in IT and Business Process Outsourcing.
Source: http://www.articlesbase.com/
Friday, June 26, 2009
Thursday, June 25, 2009
Accounting Outsourcing - Right Way to Get Stress Out Of Accounts Work
Are you wondering if you could find yourself out of this monotonous world of business and enter into a world where you can make profits by appointing services at minimal prices? Well, if you could you can make hefty profits. If you feel that the work pressure is enhancing on you day by day and you are left possibly with no time to concentrate on the core activities of your business then the possible escape from the situation is accounting outsourcing.
There are times when the owners of small as well as big business feel that they have to spend loads of time in maintaining the balance sheets, calculating the profits as well as looses incurred by the company among the other tasks. The owner of a small scale business lacks the funds to invest in a CPA to maintain their accounts work. To compensate this they have to make the essential calculation themselves such as calculating cost of stock, payment of taxes, provisional sum rendered to bad debtors among the various other debtors. There is a probability of critical mistakes made in the accounts which tosses the whole statement of accounts. Apart from this if the business owner spends all his zeal in focusing on these problems then there would be no time left for the core activities of the business which requires his attention. His lack of experience in handling the account work will make the success graph to sink. However all such discrepancies can cease easily only in case right decisions are taken. A prudent owner will prefer accounting outsourcing. By outsourcing the business owner will make colossal gain but the most important of them is having excellent services and that also at very economical prices that can be easily afforded.
The first benefit of accounting outsourcing on the list is that they can be availed at affordable prices. With this not only small business but big scale businesses also have an eye on them. Several companies have already opted for the services of accounting outsourcing and they have reaped several benefits. They even have the liberation from the tax that is offered by the government, in order to complement trade.
With accounting outsourcing businessman is liberated of any stress. This criterion is extremely important if the owner of the business wants to create a mark in a cut throat competition. The business owner will have more time to make necessary decision that will yield profit in the future. Outsourcing enables the companies to go international as most of the work done by the accounting outsourcing is for the developing countries.
With accounting outsourcing the business gets to know about the work ethics of an outsider. However, it is essential to make the choice of selecting the services of outsourcing prudently. Searching the Internet can be a wise decision but prior to appointing know everything about the company. Handling the secrets of the company along with the account work should be done in a careful manner.
There are times when the owners of small as well as big business feel that they have to spend loads of time in maintaining the balance sheets, calculating the profits as well as looses incurred by the company among the other tasks. The owner of a small scale business lacks the funds to invest in a CPA to maintain their accounts work. To compensate this they have to make the essential calculation themselves such as calculating cost of stock, payment of taxes, provisional sum rendered to bad debtors among the various other debtors. There is a probability of critical mistakes made in the accounts which tosses the whole statement of accounts. Apart from this if the business owner spends all his zeal in focusing on these problems then there would be no time left for the core activities of the business which requires his attention. His lack of experience in handling the account work will make the success graph to sink. However all such discrepancies can cease easily only in case right decisions are taken. A prudent owner will prefer accounting outsourcing. By outsourcing the business owner will make colossal gain but the most important of them is having excellent services and that also at very economical prices that can be easily afforded.
The first benefit of accounting outsourcing on the list is that they can be availed at affordable prices. With this not only small business but big scale businesses also have an eye on them. Several companies have already opted for the services of accounting outsourcing and they have reaped several benefits. They even have the liberation from the tax that is offered by the government, in order to complement trade.
With accounting outsourcing businessman is liberated of any stress. This criterion is extremely important if the owner of the business wants to create a mark in a cut throat competition. The business owner will have more time to make necessary decision that will yield profit in the future. Outsourcing enables the companies to go international as most of the work done by the accounting outsourcing is for the developing countries.
With accounting outsourcing the business gets to know about the work ethics of an outsider. However, it is essential to make the choice of selecting the services of outsourcing prudently. Searching the Internet can be a wise decision but prior to appointing know everything about the company. Handling the secrets of the company along with the account work should be done in a careful manner.
About the Author:
Alvis Brazma gives advice to business owners about how to manage their business efficiently without any hassles. To know more about Accounting firm USA, real estate accounting, retail accounting, Accounting Outsourcing , small business accounting and accounting help visit www.impacctusa.com
Source: http://www.articlesnatch.com/
Friday, June 19, 2009
Which Kind Of Accounting Is Right For You?
If you are interested in Accounting, here are some common career paths you could pursue.
There are four major kinds of accountants: public accountants, government accountants, internal accountants, and management accountants. Oftentimes they can be certified in more than one field, and switching is common.
Public Accounting
Public accountants work for firms that provide various accounting services to corporations and individuals. They perform a variety of tasks which include auditing, tax preparation, and consulting. Moving up in the field almost always requires passing the CPA exam and getting certified, after which public accountants can open their own firms, move on to different types of accounting, or move up the corporate ladder in larger firms.
The career path for a public accountant in a large firm is fairly predictable. Often, newly employed accountants will spend the first year or so doing fairly menial work and getting adjusted to the office. After that, he or she can move up to become a senior accountant. If the promotions continue, a public accountant can hope to become a high-level manager or even partner in the firm.
Public accountants who decide to open their own firms will have to run a business and build an independent client base. But the advantage of running your own firm is the flexibility and independence to set your own hours and work from home.
Want to put white-collar criminals behind bars? A special area of public accounting is forensic accounting, which investigates potential fraud and illegal financial activities. Forensic accountants often work with law enforcement officials and present their findings in court. With new government crackdowns on public accounting firms, these special accountants are becoming increasingly in-demand.
Government Accounting
A new accountant may choose to work for the local, state or federal government, often for the Internal Revenue Service (IRS). A government accountant maintains financial records for government agencies or audits private businesses or individuals who are subject to government regulations and taxation. Accountants in government progress in their careers much in the same way as accountants in private firms do, though their pay is slightly lower.
Internal Accounting
Internal accountants keep their own company's financial records accurate and in order. They evaluate their company's efficiency to make sure that all of the numbers add up. Internal accounting is becoming increasingly important since the passing of the Sarbanes-Oxley Act in 2002, which requires the chief executive and financial officers of accounting firms to sign off on and take responsibility for their firm's business. With this increased pressure and accountability, firms are hiring more internal accountants to ensure against malfeasance. Internal accountants can also become certified as CIAs, or Certified Internal Accountants. The requirements for this certification are very similar to those for becoming a CPA. A bachelor's degree, successful completion of a four-part exam, and experience are required for both. Accountants may have multiple certifications and designations, especially if they switch between the four different types of accounting throughout their careers.
Management Accounting
Management accountants work internally for the company that employs them, recording and analyzing financial information. What differentiates them from internal accountants is that they are involved in budgeting, managing costs, and evaluating the company's efficiency. Management accountants often start their careers as internal auditors and work their way up to full-fledged management accountants. The process to become a Certified Management Accountant is similar to those of a CPA or CIA and involves taking a four-part exam.
Read More Article...
There are four major kinds of accountants: public accountants, government accountants, internal accountants, and management accountants. Oftentimes they can be certified in more than one field, and switching is common.
Public Accounting
Public accountants work for firms that provide various accounting services to corporations and individuals. They perform a variety of tasks which include auditing, tax preparation, and consulting. Moving up in the field almost always requires passing the CPA exam and getting certified, after which public accountants can open their own firms, move on to different types of accounting, or move up the corporate ladder in larger firms.
The career path for a public accountant in a large firm is fairly predictable. Often, newly employed accountants will spend the first year or so doing fairly menial work and getting adjusted to the office. After that, he or she can move up to become a senior accountant. If the promotions continue, a public accountant can hope to become a high-level manager or even partner in the firm.
Public accountants who decide to open their own firms will have to run a business and build an independent client base. But the advantage of running your own firm is the flexibility and independence to set your own hours and work from home.
Want to put white-collar criminals behind bars? A special area of public accounting is forensic accounting, which investigates potential fraud and illegal financial activities. Forensic accountants often work with law enforcement officials and present their findings in court. With new government crackdowns on public accounting firms, these special accountants are becoming increasingly in-demand.
Government Accounting
A new accountant may choose to work for the local, state or federal government, often for the Internal Revenue Service (IRS). A government accountant maintains financial records for government agencies or audits private businesses or individuals who are subject to government regulations and taxation. Accountants in government progress in their careers much in the same way as accountants in private firms do, though their pay is slightly lower.
Internal Accounting
Internal accountants keep their own company's financial records accurate and in order. They evaluate their company's efficiency to make sure that all of the numbers add up. Internal accounting is becoming increasingly important since the passing of the Sarbanes-Oxley Act in 2002, which requires the chief executive and financial officers of accounting firms to sign off on and take responsibility for their firm's business. With this increased pressure and accountability, firms are hiring more internal accountants to ensure against malfeasance. Internal accountants can also become certified as CIAs, or Certified Internal Accountants. The requirements for this certification are very similar to those for becoming a CPA. A bachelor's degree, successful completion of a four-part exam, and experience are required for both. Accountants may have multiple certifications and designations, especially if they switch between the four different types of accounting throughout their careers.
Management Accounting
Management accountants work internally for the company that employs them, recording and analyzing financial information. What differentiates them from internal accountants is that they are involved in budgeting, managing costs, and evaluating the company's efficiency. Management accountants often start their careers as internal auditors and work their way up to full-fledged management accountants. The process to become a Certified Management Accountant is similar to those of a CPA or CIA and involves taking a four-part exam.
Read More Article...
Thursday, June 18, 2009
Bookkeepers and Accountants Choose Double Entry Bookkeeping for Accuracy
Double entry bookkeeping stretches back centuries perhaps even as early as the 12th century and is now accepted worldwide as the accounting standard to be employed by all companies in recording the financial accounting records. The first written explanation of the accounting system was reportedly by a Venetian mathematician Luca Pacioli towards the end of the 15th century.
The accounting industry has grown somewhat since then and today contains many technical words known but largely ignored by non accountants. The understanding and desire to understand accounting terms is further confused by the banking industry while adopting double entry bookkeeping as standard use what appears to be diametrically opposed terms in the presentation of information to their customers.
In accounting terms an asset such as money in the bank is a debit balance while bank customers are told if they have money in the bank it is a credit balance. This arises because what the bank is really saying is when a customer has money in the bank that the balance represents a creditor to the bank as it owes the customer money and is a creditor in the banks books. Hence the bank describes the balance as a credit balance.
The simplest way to understand double entry bookkeeping is the understanding that every financial transaction has a double effect. One effect is to change the profit and loss of the business with sales income increasing the financial profit and purchases reducing the financial profit. While the double entry is that every profit and loss transactions also has a balance sheet effect in either increasing assets or increasing liabilities.
In more complex accounting areas such as journal entries or bank transactions both sides of a transaction may have no impact on the profit and loss account as both sides of the double entry effect the value of balances in the balance sheet. For example when a creditor is paid the bank balance reduces and the amount owed by the business reduces by the same amount.
Read More Article...
The accounting industry has grown somewhat since then and today contains many technical words known but largely ignored by non accountants. The understanding and desire to understand accounting terms is further confused by the banking industry while adopting double entry bookkeeping as standard use what appears to be diametrically opposed terms in the presentation of information to their customers.
In accounting terms an asset such as money in the bank is a debit balance while bank customers are told if they have money in the bank it is a credit balance. This arises because what the bank is really saying is when a customer has money in the bank that the balance represents a creditor to the bank as it owes the customer money and is a creditor in the banks books. Hence the bank describes the balance as a credit balance.
The simplest way to understand double entry bookkeeping is the understanding that every financial transaction has a double effect. One effect is to change the profit and loss of the business with sales income increasing the financial profit and purchases reducing the financial profit. While the double entry is that every profit and loss transactions also has a balance sheet effect in either increasing assets or increasing liabilities.
In more complex accounting areas such as journal entries or bank transactions both sides of a transaction may have no impact on the profit and loss account as both sides of the double entry effect the value of balances in the balance sheet. For example when a creditor is paid the bank balance reduces and the amount owed by the business reduces by the same amount.
Read More Article...
Friday, June 12, 2009
Outsourcing Your Bookkeeping - Advantage
The importance of doing proper bookkeeping in any type of business is not in question. There are many benefits to be accrued from doing so but the main ones stand out - find out what you and your business stand to gain.
The foremost advantage about outsourcing bookkeeping services is that your business gets to save money. The very notion that money can be saved may spark incidences where poor decisions can be made; what is important is to ensure that you always seek persons who can offer quality, this is the only way in which you will get your money’s worth. Another very vital advantage that is worth considering is the fact that you won’t be required to pay for the myriad of costs that come with hiring a full-time bookkeeper including the employers payroll tax expense or the workman’s compensation.
Before you make the final decision to hire a particular bookkeeper on an outsourced basis, it is prudent that you pay attention to the figure that the prospective bookkeeper will quote when stating their fees. This is one test of ensuring that the person you are hiring really understands the intricacy of the work at hand. The well informed bookkeeper will charge a fee in the range of at least three times what the hired bookkeeper is paid. The reason for this is that they have to fix in costs that will cover or compensate for lost fees that they would otherwise be paid if they were in full-time employment.
Read More Article...
The foremost advantage about outsourcing bookkeeping services is that your business gets to save money. The very notion that money can be saved may spark incidences where poor decisions can be made; what is important is to ensure that you always seek persons who can offer quality, this is the only way in which you will get your money’s worth. Another very vital advantage that is worth considering is the fact that you won’t be required to pay for the myriad of costs that come with hiring a full-time bookkeeper including the employers payroll tax expense or the workman’s compensation.
Before you make the final decision to hire a particular bookkeeper on an outsourced basis, it is prudent that you pay attention to the figure that the prospective bookkeeper will quote when stating their fees. This is one test of ensuring that the person you are hiring really understands the intricacy of the work at hand. The well informed bookkeeper will charge a fee in the range of at least three times what the hired bookkeeper is paid. The reason for this is that they have to fix in costs that will cover or compensate for lost fees that they would otherwise be paid if they were in full-time employment.
Read More Article...
Thursday, June 11, 2009
4 Tips for Bookkeeping and Fundraising
When you run a not for profit organization or other type of firm that needs funds raised by methods other than retail sales or other types of financial transactions, chances are you will be involved in the world of fundraising. A fundraiser is often time a fun event and one that is very important for you because it provides potential donors with a specific moment and cause for which to donate funds to you. Also, when it comes to money, you need to be highly organized and make sure that the event does not become too difficult for you to handle and that the funds being raised surpasses the cost of the event itself. For this, you need good book keeping and below are four tips to help you achieve in this area.
-Unless you are soliciting donations of which the amount is freely chosen by the donor, come up with a specific donation amount that people can give. In this scenario your book keeping can be largely uniform and easy to comprehend. Also, inviting the opportunity for donors to choose their own amount can cause time wasted if they are giving too little and your costs are not met. The only downside to discouraging these types of donations is you might not receive a very large and generous sum that a person might otherwise give to your cause.
-Make sure that all necessary personal information is recorded from the person giving you a donation. Should their donation be ill conceived, a check they write bounce or another problem arise, you need to know exactly who is giving you what and how to be able to keep track of them should a legal problem arise. Lack of information and documentation could spell disaster in some cases like this.
Read More Article...
-Unless you are soliciting donations of which the amount is freely chosen by the donor, come up with a specific donation amount that people can give. In this scenario your book keeping can be largely uniform and easy to comprehend. Also, inviting the opportunity for donors to choose their own amount can cause time wasted if they are giving too little and your costs are not met. The only downside to discouraging these types of donations is you might not receive a very large and generous sum that a person might otherwise give to your cause.
-Make sure that all necessary personal information is recorded from the person giving you a donation. Should their donation be ill conceived, a check they write bounce or another problem arise, you need to know exactly who is giving you what and how to be able to keep track of them should a legal problem arise. Lack of information and documentation could spell disaster in some cases like this.
Read More Article...
Friday, June 5, 2009
Bookkeeping Business Tips for Developing Reliable Financial Projections
Financial forecasting reminds me of the weather - you make your forecast at a moment in time based upon the information currently available. You draw a conclusion and state your financial forecast. But then, the information changes, now it's raining, and you're caught without your umbrella!
Financial forecasting, unlike the weather, isn't a science but it's not pure guess work either. It is a combination of:
Bookkeeping Business Tip #1: Review Actual Year-To-Date Results
Start by looking at where you've been. If you use an accounting program like QuickBooks you can print out a Profit & Loss statement showing year-to-date results. Check the statement for all financial transactions that occurred up to the date of the report. Reconcile the report to your bank statements. (If you don't use an accounting program or bookkeeping service, then take the difference of the total year-to-date cash receipts and total expenditures. This should equal your profit or loss.) Examine each line item to make sure that it makes sense - is your year-to-date revenue figure where you anticipated, or has it fallen short? Are expenses higher than expected?
Bookkeeping Business Tip #2: Establish Goals and Incorporate into Your Forecast
What do you wish to accomplish by year's end? Do you want to introduce a new product or service, increase revenue on existing products or services, decrease spending, hire a new employee, outsource a bookkeeping service, or launch a marketing campaign that will position the company for the beginning of next year?
Write out your objectives and then choose three to five which are the most important to accomplish by the end of the year. Determine the needed steps to achieve the objectives. Which Profit & Loss line items will be impacted? Adjust your forecast accordingly. For example, your goal may be to increase revenue 10% by year's end or to launch a marketing campaign now so its benefits will be felt in the first quarter of 2009.
Bookkeeping Business Tip #3: Forecast Variable Costs
Variable costs are costs that change in step with revenue change. For example, you are selling more widgets; therefore, your labor costs and materials costs will increase in relation to the revenue increase.
Using the concept that Forecast = Projections + Predictions, combined with the knowledge that variable costs change in step with revenues, forecast each month's variable costs. Forecast each line item separately. Look for opportunities to reduce costs, and be aware of likely future influences on each cost.
Bookkeeping Business Tip #4: Forecast Fixed Expenses
Fixed costs are relatively stable costs that recur every month. Examples of fixed costs are rent, telephone and bookkeeping service fees. Forecast the month's fixed expenses by using the same concept used to forecast variable costs (Forecast = Projections + Predictions) and the knowledge that fixed expenses tend to be relatively stable and do not change in step with revenues. Again, forecast each line item separately, looking for opportunities to reduce costs, while keeping in mind any likely future influences.
Bookkeeping Business Tip #5: Forecast Net Profit
The final step is to evaluate your forecast for net profit. Is the profit forecast is reasonable and acceptable? If not, re-evaluate each line item including revenues and make appropriate adjustments. Also, anticipate non-operating income and expense items, and include them in your forecast.
Your financial projections may not be perfect at first, but we didn't learn to walk without falling down. As a business coach I've seen others get a few bumps along the way. But I guarantee that if you follow these bookkeeping business tips, set your financial projections on paper and revisit them frequently, you will achieve your goals faster.
About Author : Laurie O'Neil is the co-founder of The Bookkeeper's Referral Network Inc., the place where business meets great bookkeepers. To get your copy of The 9 Disastrous Mistakes Most Freelance Bookkeeper's Make in
Business (and How You Can Avoid Them!) visit http://www.bkpr-network.com
Financial forecasting, unlike the weather, isn't a science but it's not pure guess work either. It is a combination of:
- knowing your business;
- understanding your marketplace;
- setting goals; and
- using common sense.
- when seeking financing
- gauging the profitability of a new product or service
- determining the impact of staff expansion or cutback
- assessing other business decisions
Bookkeeping Business Tip #1: Review Actual Year-To-Date Results
Start by looking at where you've been. If you use an accounting program like QuickBooks you can print out a Profit & Loss statement showing year-to-date results. Check the statement for all financial transactions that occurred up to the date of the report. Reconcile the report to your bank statements. (If you don't use an accounting program or bookkeeping service, then take the difference of the total year-to-date cash receipts and total expenditures. This should equal your profit or loss.) Examine each line item to make sure that it makes sense - is your year-to-date revenue figure where you anticipated, or has it fallen short? Are expenses higher than expected?
Bookkeeping Business Tip #2: Establish Goals and Incorporate into Your Forecast
What do you wish to accomplish by year's end? Do you want to introduce a new product or service, increase revenue on existing products or services, decrease spending, hire a new employee, outsource a bookkeeping service, or launch a marketing campaign that will position the company for the beginning of next year?
Write out your objectives and then choose three to five which are the most important to accomplish by the end of the year. Determine the needed steps to achieve the objectives. Which Profit & Loss line items will be impacted? Adjust your forecast accordingly. For example, your goal may be to increase revenue 10% by year's end or to launch a marketing campaign now so its benefits will be felt in the first quarter of 2009.
Bookkeeping Business Tip #3: Forecast Variable Costs
Variable costs are costs that change in step with revenue change. For example, you are selling more widgets; therefore, your labor costs and materials costs will increase in relation to the revenue increase.
Using the concept that Forecast = Projections + Predictions, combined with the knowledge that variable costs change in step with revenues, forecast each month's variable costs. Forecast each line item separately. Look for opportunities to reduce costs, and be aware of likely future influences on each cost.
Bookkeeping Business Tip #4: Forecast Fixed Expenses
Fixed costs are relatively stable costs that recur every month. Examples of fixed costs are rent, telephone and bookkeeping service fees. Forecast the month's fixed expenses by using the same concept used to forecast variable costs (Forecast = Projections + Predictions) and the knowledge that fixed expenses tend to be relatively stable and do not change in step with revenues. Again, forecast each line item separately, looking for opportunities to reduce costs, while keeping in mind any likely future influences.
Bookkeeping Business Tip #5: Forecast Net Profit
The final step is to evaluate your forecast for net profit. Is the profit forecast is reasonable and acceptable? If not, re-evaluate each line item including revenues and make appropriate adjustments. Also, anticipate non-operating income and expense items, and include them in your forecast.
Your financial projections may not be perfect at first, but we didn't learn to walk without falling down. As a business coach I've seen others get a few bumps along the way. But I guarantee that if you follow these bookkeeping business tips, set your financial projections on paper and revisit them frequently, you will achieve your goals faster.
About Author : Laurie O'Neil is the co-founder of The Bookkeeper's Referral Network Inc., the place where business meets great bookkeepers. To get your copy of The 9 Disastrous Mistakes Most Freelance Bookkeeper's Make in
Business (and How You Can Avoid Them!) visit http://www.bkpr-network.com
Thursday, June 4, 2009
How Do I Get Bookkeeper Certification?
There are three steps required to get bookkeeper certification: post-secondary education, bookkeeping experience, and the successful completion of the certification examination. A bookkeeper is responsible for the daily financial management of a small to medium sized company. In addition to financial document data entry, bookkeepers also process payroll, run reports, and reconcile accounts.
People who want to get bookkeeper certification have usually been working as a bookkeeper for several years and enjoy bookkeeping or accounting. The bookkeeping certification is granted by the American Institute of Professional Bookkeepers (AIPB). Successful graduates can provide this certification to potential employers.
The first step toward getting a bookkeeper certification is to complete a post-secondary education program. Many people complete a one- or two-year bookkeeping program at a community or career college. This training covers accounting principles, financial reporting requirements, important business law and related issues. Most schools offer both full- and part-time programs available. This flexibility allows students to work and learn.
A minimum of three years' bookkeeping experience is required before you are eligible to write the bookkeeper certification examination. This must be verifiable bookkeeping experience, where you are solely responsible for a company's financial processes. This type of experience is usually earned over a period of two to three calendar years.
The bookkeeping certification examination is two to three hours in length and is a combination of multiple choice and calculation problems. Many associations offer preparation courses and seminars to help students prepare for this exam. Accuracy, comprehension and speed are all important when preparing for this examination.
Upon successful completion of the bookkeeping certification program, candidates can look for employment opportunities as bookkeepers in a company, set up their own bookkeeping business, or work for an accounting services firm as a bookkeeper. It is highly recommended that anyone who is planning to set up her own bookkeeping company obtain the certificate first. Professional credentials provide assurances to all potential clients that you have a specific level of skill and training as a bookkeeper.
People who enjoy working with numbers, are detail-oriented, and like to work independently report the greatest level of satisfaction as bookkeepers. This type of work is often a stepping stone to further accounting training programs. There is a specific limit to the services that a bookkeeper can offer, based on government regulations. Bookkeepers are not able to create financial statements, complete tax returns, or provide financial advice. These functions are limited to Certified Professional Accountants (CPAs).
Source : http://www.wisegeek.com/
People who want to get bookkeeper certification have usually been working as a bookkeeper for several years and enjoy bookkeeping or accounting. The bookkeeping certification is granted by the American Institute of Professional Bookkeepers (AIPB). Successful graduates can provide this certification to potential employers.
The first step toward getting a bookkeeper certification is to complete a post-secondary education program. Many people complete a one- or two-year bookkeeping program at a community or career college. This training covers accounting principles, financial reporting requirements, important business law and related issues. Most schools offer both full- and part-time programs available. This flexibility allows students to work and learn.
A minimum of three years' bookkeeping experience is required before you are eligible to write the bookkeeper certification examination. This must be verifiable bookkeeping experience, where you are solely responsible for a company's financial processes. This type of experience is usually earned over a period of two to three calendar years.
The bookkeeping certification examination is two to three hours in length and is a combination of multiple choice and calculation problems. Many associations offer preparation courses and seminars to help students prepare for this exam. Accuracy, comprehension and speed are all important when preparing for this examination.
Upon successful completion of the bookkeeping certification program, candidates can look for employment opportunities as bookkeepers in a company, set up their own bookkeeping business, or work for an accounting services firm as a bookkeeper. It is highly recommended that anyone who is planning to set up her own bookkeeping company obtain the certificate first. Professional credentials provide assurances to all potential clients that you have a specific level of skill and training as a bookkeeper.
People who enjoy working with numbers, are detail-oriented, and like to work independently report the greatest level of satisfaction as bookkeepers. This type of work is often a stepping stone to further accounting training programs. There is a specific limit to the services that a bookkeeper can offer, based on government regulations. Bookkeepers are not able to create financial statements, complete tax returns, or provide financial advice. These functions are limited to Certified Professional Accountants (CPAs).
Source : http://www.wisegeek.com/
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