accounting management
A Part Of Day Life Accounting Vocabulary
An accounting package is for communication and maintaining your financial records. The package produces information that tells specific things about the company. An accounting package provides the information regarding the finances of the business at the owner’s fingertips. The software should include accounts receivable, accounts payable, order entry, inventory control, cost accounting, payroll and fixed assets accounting. The general ledger should show transactions in four different categories. These categories include the account assets, liabilities, income and expenses.
The type of information needed from an accounting software program should be accurate, fulfill management’s needs and be easy to use. As well as accuracy, relevancy and simplicity an accounting system should be set up so that it does not require an inordinate amount of time to maintain. The accounting system should be easy enough to understand so that a CPA is not required to operate it or interpret its output. Many small business owners are going to QuickBooks, as this is a relatively easy system to use. This software is very user friendly. Files can be transferred easily and the reports are easy to read. QuickBooks is one of many options offered. You should select the accounting package that best suits your business needs.
It is best to make sure that whoever is going to be running your accounting system has some knowledge of computers and accounting. Even though QuickBooks and other accounting software can be very user friendly, theperson running it will still need a certain amount of accounting knowledge. It might even be beneficial for the person running the accounting system to take a class or two in basic Accounting at your local community college.
If you are just starting your business and are looking at different software packages to purchase, many offer a 30 day trial or a demo version so that you can see what will work best for you.
For more information about accounting software programs, contact us today.
IAC Professionals is a single source for contracting qualified professionals to assist you with your most critical business needs. They offer a wide range of outsourcing solution which include Accounting, Bookkeeping, Virtual Assistants, Company Formation and
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Choosing The Best Small Business Accounting Software
Choosing the best small business accounting software may help your company survive. Yes, out of control finances kill many a company every year. How do you know when to order inventory when you really don’t know what your inventory levels are? Is hiring a new employee a good idea? How can you decide? Will it pay to buy a new piece of equipment? Many decisions are easier to make and many decisions are almost automatic if your financial systems are under control. Plus having a smooth running financial system is a sure stress reducer and reducing stress helps with decision making too. Here’s how to get the right system.
Your Needs.
Every industry is different and your company is unique. Think about what you need from an accounting system. Maybe inventory is an important part of your business or maybe not. Do you need a payroll system or not? Before you do much shopping for software, think through what you need in the way of information. That way you’re less likely to be sold something you don’t need. Remember too that some of what you may do now to management your business can be done easier and faster. Maybe you check inventory every morning, but a computerized inventory system could keep inventory levels current all the time. You could check inventory levels less often and save time and money.
Easy To Use.
Buy a puppy and the cost just starts. That’s the way accounting software is too. The initial cost is just the start. Learning how to use the software may be a bigger challenge than you think. Sure it’s nice to talk about all the power a computer system has. But the easier, the better. Buy a system to meet your needs, not one that’s much more complex than you’ll ever need. Is this a proven system? Is there somebody who can help you if you get in trouble? Often times local accounting firms are a resource to help you with problems.
Not Too Complex.
You can often get software in different modules. Get the main accounting system, with general ledger and journals in one package. Then you can add payroll or inventory management or other modules. You can even get industry specific versions like construction company versions or retail versions, just whatever you need.
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Often the best choice may be an off-the-shelf product. Very seldom does a small business need a custom software product. You want a proven product used by businesses much like yours.
Will It Grow?
Need more computing power as you grow? It’s much easier to move to a more powerful version of the software you have than to buy from a different company. That’s true because usually the more powerful version is designed to look and operate like what you have now. That’s why staying within the Peachtree Software products makes upgrading easier. Same with Quickbooks. Upgrading within Quickbooks is easier than switching from Quickbooks to Peachtree. Be careful of a cheap software system with no upgrade product. You’ll be stuck.
Reduce stress and make better decisions too with the best small business accounting software. The best investment you can make when choosing software is to first decide what you really need. Then buy a system that meets your needs, but that’s as simple to use and upgrade as possible. That’s a sure route to cost and time savings. You will be much less likely to buy more system than you need if you carefully think through your requirements as the very first step when choosing accounting software.
By: Al Bullington
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A Personal Loan Company
What would you do if you needed cash? Whether it was to pay off some bills, go on holiday or do some home improvements, you need personal loan. Deciding you want a loan is easy but choosing where to get the loan may be slightly more difficult. Here are five things to consider when looking at personal loan companies.
1. This is business.
No matter where you get your loana bank or a finance companythat entity is out to make a buck (or many) off of you. While reputable businesses will be honest about the costs, as is required by law in most cases, they will not let you know whether you should go down the street to save a few hundred dollars.
Along those lines, you should definitely shop around when looking for a personal loan company. While most personal loans do not have the lengthy payback term that a mortgage does, this will still last for a chunk of your life, anywhere from several months to many years. You do not want to be a month into a five-year loan and realize you should have used another personal finance company.
Things to look for when shopping around:
– Interest rate. The interest rate on a personal loan can vary from 5% to 25%. Over the life of a loan, that’s a LOT of money. Ensure you are getting the lowest possible rate.
– Fees. Most businesses make their money on a personal loan in the interest they charge. However, some companies may charge fees and you should be aware of these fees and why they’re being charged. Is it to reduce the interest rate, or is it the company just making more money off of you?
– Application processing. How long will it take to process your application? And who makes the decision? How soon you need the cash will help decide which personal loan company to use.
This is by no means a complete list of what you need to keep in mind when looking for a personal loan company, but it should get you started.
2) What is the company’s reputation?
You do not want to deal with a fly-by-night operation that makes huge promises, gives you the money then starts charging all sorts of “fees” that have been written into the fine print. Nor do you want one that will mess with your credit. Some questions you should ask before signing with a personal loan company are:
– How long have they been in business? Just because a company is new does not mean it isn’t reputable, just as a company that has been in business thirty years isn’t necessarily reputable. However, most places that do poor business do not stay around for very long.
– Does the personal loan company have any recommendations on file? Perhaps the company has received some letters they can share from customers that have appreciated the business. While this may be a long shot, it may be worth asking.
– Better yet, do you have any friends that can recommend this company? If someone you know used the personal loan company and had a good experience, chances are you will do well with them too.
As before, this list can be added on to. It should get you thinking about the company’s worthiness to have your business. From there, you’ll come up with more questions on your own.
3) Does the personal loan company do secured or unsecured loans?
Do you know the difference between these two types of loans?
– A secured loan has some type of collateral that you pledge to give the personal finance company if you don’t pay back the loan. In other words, you’ve “secured” the company’s ability to make its money back if you stop making payments because you lose the collateral. In the case of a mortgage, the collateral is a house. With a car loan, you risk losing your car. With a personal loan, you may pledge a valuable piece of jewelry or a collection of some type.
– An unsecured loan is similar to credit card debt. There is no collateral to cover the personal finance company’s investment if you default on the loan. By the way, that doesn’t mean you get away with anything. The company will come after you for an unsecured loan as quickly as for a secured loan.
4) How will your credit standing affect the loan company’s desire to do business with you?
Do you have bad credit or no credit at all? Some personal finance companies may not want to even talk to you in this case. There are other companies who would delight in taking your business however, as you’re considered a risk, there is a chance they would also charge a ridiculous interest rate.
Another possibility is that the company may require you to have a cosigner on the loan. This is more likely if you’re young and have bad or no credit. What this means is that you won’t get the money on just your signature saying you’ll repay the loan. The cosigner also signs the loan documents which are legally binding and can be used to collect in a court of lawand if you default will pay back the loan. If a company requires you to have a cosigner, this could be a problem. Many people will not cosign a loan (or don’t have the credit necessary to do so), because of the financial responsibility.
5) Do you like them?
Okay, this one may seem silly, but if you dread stepping into the personal loan company’s offices, or cannot stand listening to your loan officer’s voice, this could cause problems at some point. Whether this is a gut instinct telling you to run away or is just something that happens for no apparent reason, you don’t want to deal with any company that makes you uncomfortable. Keep in mind, just because you like someone doesn’t mean they will do a good job for you. And someone you don’t like may do a great job for you. However, stressing over your interaction with the personal loan company may not be conducive to ensuring you’re getting the best deal possible or not being taken advantage of.
Unfortunately, there are no absolutes when dealing with life, and that includes getting a personal loan. However, if you keep these recommendations in mind, ask any questions you have (no matter how dumb they may seem) and verify every step you take, then getting the money you need should be relatively painless.
By: Julie Davidson
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Monthly Personal Budget Using Excel Spreadsheet
Plan your monthly personal or family budget without help from any tools should be a difficult task for you. The easiest way to plan your budget is to use help from Microsoft Excel. Use the following steps to create your own personal budget in excel spreadsheet :
1. Write down your daily expenses in one month period
Create four columns and label them with name “Date”, “Description”, “Category”, and “Amount”. Start filling the columns with your daily expenses. You can write any description for your expenses. Categorize it based on your defined category, and fill the amount of that expense.
2. Summarize your expenses
Create new columns and summarize your daily expenses into category where you have to use excel function to sum your daily expenses based on their category. Name the new columns with name “Category” and “Expenses”. You can create it within the same spreadsheet or in separate spreadsheet.
3. Add budget column
Add a new column next to Amount column in step 2, and label it with name “Budget”. Fill your “Budget” column with the same amount with “Expenses” column.
4. Subtract your monthly income with budget and expenses
Sum the total amount of your “Expenses” and “Budget” columns. Create new rows below “Budget” column, and label it “Income” and “Saving”. Input your monthly income, and then in “Saving” cell subtract Income with total amount from “Budget” column. If the result is positive, you can use your expenses as your budget reference. If it is negative, you need to adjust your budget where you think you can save the expenses of that category, and try to commit on this budget on the following month.
You can follow those steps above to simplify your monthly personal budgets, or you can also find some personal budgets created in excel available in internet to ease your plan.
By: Rizatar
Financial Statements Can Be Erroneously Prepared
The misuse or misunderstanding of the proper application of materiality can lead to manipulating reported income through “earnings management” techniques. This type of fraudulent financial reporting receives ample attention in the financial press. This is a subject relevant to the preparation and audit of all financial statements. SEC Staff Accounting Bulletin (SAB) no. 99, Materiality, helps advise preparers and independent auditors how to evaluate materiality misstatements in the financial reporting and auditing processes considering certain GAAP and the federal securities laws that relate to materiality.
Materiality is defined by the FASB as, “The magnitude of an omission or misstatement of accounting information that, in the light of surrounding circumstances, makes it probable that the judgment of a reasonable person relying on the information would have been changed or influenced by the omission or misstatement.” The criteria for determining materiality by the FASB is that if the presentations of financial information are to be prepared economically on a timely basis and presented formally, then the concept of materiality is crucial. Misstatements occurring from clerical error or adjustments for missed invoices are not required to always be corrected as long as the error is identified in the audit process and management is notified.
Reliance on quantitative benchmarks to determine whether items are material to the financial statements is not acceptable. Qualitative, as well as quantitative factors, must be considered in determining the materiality of differences and/or omissions. Abuse of materiality, errors that are intentionally recorded within a defined percentage ceiling, and then dismissed as not enough to affect the bottom line, is not tolerated as well.
The SAB describes several qualitative factors that management and auditors can refer to when determining the materiality of misstatements. In a financial statement, a quantitatively small misstatement may become material if:
1)The misstatement came from an item that can be precisely measured.
2)It is from an estimate.
3)It disguises a change in earnings.
4)It covers up a failure to meet analysts’ expectations of the endeavor.
5)It changes a loss into income.
6)It involves a portion of the business that has been classified as a significant business segment regarding profitability.
7)It affects the business’s ability to adhere to regulations.
8)It affects the business’s ability to comply with contractual obligations.
9)It effects the management’s incentive compensation.
10)It involves the covering up of illegal activity.
The appropriate use of materiality should strengthen the effectiveness of financial reporting.1.
The American Institute of Certified Public Accountants’ (AICPA) Auditing Standards Board recently issued a new standard that requires CPAs to perform additional procedures to help detect potentially fraudulent actions. SAS No. 82, Consideration of Fraud in a Financial Statement Audit, meets the public’s expectations of assurance that financial statements are devoid of material misstatement caused by error or fraud. SAS no. 82 is designed to help define the responsibilities of the auditor in detecting fraud.
Errors that are unintentional can occur at any time or place causing unpredictable financial statement effects. A thorough internal control system can reduce the risk of material errors. Fraud, however, is intentional and is usually accomplished by avoiding internal controls. Fraud is difficult to detect using internal controls and requires the expertise of the auditor.
SAS No. 82 provides auditors with guidelines on how to address potential fraudulent situations in a financial statement audit. It describes the different types of fraud and advises the auditor of how to differentiate between the risk of material fraud, fraudulent financial reporting, and misappropriation of assets. SAS also requires auditors to record the risk factors identified and their response to them in both employee and management fraud.
Employee fraud usually involves the misappropriation of assets or improper record keeping. Employees are known to commit fraud due to or in combination with various factors:
1)Emotional duress
2)A perceived opportunity to get away with something
3)Resentment due to perceived pay inequity.
Management fraud usually involves manipulative financial reporting. There are several incentives for management fraud. They include:
1)Incentive to affect stock price
2)Expectations of investors
3)To avoid debt
4)To avoid tax liability
5)To meet budget
6)To influence creditors
7)To achieve bonuses
8)To avoid punishment.
To avoid the fraudulent activities of employees and management several things need to be implemented. Internal controls must be maintained to insure ethical practices are maintained. Top management’s support of internal control must be assured so as to not lose its effectiveness. Unusual or difficult transactions should be monitored thoroughly. Top management sets the tone for financial activity, if the ethical code is weak, a third party must become involved.
SAS No. 82 provides that the auditor accepts responsibility for detecting fraudulent practices and communicating with managers. It also contains performance guidelines to assess the risk of material misstatement due to fraud and how to respond to the risks involved. This standard raises public expectations and gives auditors greater responsibility in assuring that fraudulent practices no longer go undetected.2.
1.C. Terry Grant, “Earnings Management And The Abuse Of Materiality.” Journal of Accountancy (September, 2000)
2. Alan Reinstein; Gregory A. Coursen, “Considering The Risk Of Fraud: Understanding the Auditor’s New Requirements,” The National Public Accountant (March/April, 1999): 34-38
By: Jason McGraw
A Personal Loan Approved
Money is getting more and more liquid these days and pay checks are almost always not enough to cover every expense, mortgage payment, and credit card bill that comes every month like clockwork. Most of the time, you can get by with the money that you get from your employment however, there are and there certainly will be instances when you will need to secure more funds in order to make both ends meet. This is where your credit worthiness comes to play and if you happen to have bad credit, it will be hard for you to get approved for a loan. Securing quick cash does not have to be extremely hard though, if only you know how to work around your credit status that might not be very attractive to creditors.
Quick cash from personal loans can be obtained easily in a number of ways. First, you have to scope the market for creditors who are reputable as well as fair when it comes to levying interest rates. You can also help your chances of getting approved a lot bigger if you have any collateral that you can put up such as a checking account especially in cases when it becomes a requirement. You have to bear in mind that there is an excellent possibility that you will land a loan agreement that includes very high interest rate since you are a high risk borrower who is not the type of client that most creditors would prefer.
If you want to save some money in interest payment, you have to take time to find creditors that would be willing to grant you a loan for a much lower rate. You should not have to take on a financial burden such as a short term type of loan if you do not have enough money to cover it when due date comes. Be modest when it comes to determining exactly how much you will need because quick cash loans can get tricky. As a general rule, this type of loan only allows very little money (as little as $250) but you can also get approved for a larger amount (as much as $2,500) as per the discretion of the creditor concerned.
When you decide to apply for a quick personal loan, you have to be ready to submit pertinent require
ments such as proof of your identification which includes a residential or business phone number, bank account information which might have to include an active checking account, and other documents that would signify your capacity to pay back the money you intend to borrow. Should you opt for a no credit check type of loan, it will be a lot easier for you to get approved since credit worthiness is not one of the requirements. Having a good job and good bank account records will help seal the deal between you and the creditor and will facilitate the processing of your loan, which in the best case scenario can be approved in as little time as 1 hour.
By: Sarah Egelston
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Effective Delivery Management For Route Accounting
With so many things to manage in an organization, many small things like the shelf-life of the product, their delivery, and invoices often gets either neglected or mismanaged by the supervisor. Route accounting system is therefore a good solution to manage applications that involve trading of services and goods that are often noticed in the movable environment. These route accounting purposes are most commonly used in service and delivery organizations, for example – beverage distribution. It also helps in delivering the products that have a short-life to the business organizations regularly.
Only one single representative is required to effectively manage the route accounting so as to serve customers proficiently, issue invoices, collect payments and acknowledge purchase orders. That is to say, this single representative extends a helping hand to customer and assists them in every aspect of the purchase procedure, from the very first stage of the purchase order till the time invoices are being settled for with them. This assures the customer of the support and service that they seek in the company.
Advantages of Route accounting
1. Route Accounting Solution avoids argument with customers as to the delivery status of the package and its condition when it was delivered.
2. It minimizes the time lapse in delivery and fee payment of the package; one can simply accept payments in field.
3. Enable your drivers to provide a receipt to clients that have their own signature over it without any need to make the return to any truck-mounted printer.
4. The information of run reports that keep a track of the time between the product deliveries, mark for merchandise, and the damaged merchandise help to manage routes even more efficiently and settle inventory levels.
5. Quantities of daily inventory are updated for the sales reporting. It helps you to frequently know about the products that are selling faster and at the locations at which they are selling. This provides customers with an option to place their orders and prevent products from going out of stock.
6. It helps you to directly connect with your ERP or accounting system. As it allows you to share all information, you can utilize your time in making money rather than crunching numbers.
Situations of route accounting
There are basically four main situations that are involved in route accounting:
i. Delivery – This refers to delivery of the packages or products to the customers.
ii. Direct Store Delivery or DSD – This involves delivery of products to stores and probably even stocking of your products on their shelves.
iii. Pre-sale – This means a visit to the store so as to analyze what is it that customers are selling and what is their demand which they want to purchase.
iv. Peddle Sales – This is one step ahead of the pre-sale and in fact carrying of the products stock in the trucks in order to conduct spot sales.
Hence, if you are looking forward to have an organization that does not have to deal with any delivery problems along with efficient management in the delivery process, route accounting is undoubtedly the best solution available to you.
By: James buchanan
A Certain Cause of Failure In The Business
Knowing how to start a business is obviously important for entrepreneurs. But, knowing what causes failure in the start up stage is equally important. Find out the critical difference between those entrepreneurs that succeed and those that fail.
The most important, critical, absolutely essential element to start a business successfully is ….drum roll please…. to be productive. “Are you kidding?” you’re probably saying, “That’s it. That’s all you got for me.” Well not exactly, let me elaborate.
We all love to feel as if we are being productive. Our culture is based on hard work and getting things done – anything short is unsettling. Even watching T.V. we like to feel as if we have accomplished something. I believe this is one of the reasons the Discovery channel is so successful. That way, when we just watched 4 hours of TV, we can justify it by telling people that we learned how to put a motorcycle together. Now, obviously, watching a television show is not being productive, but the point is that our minds can often justify unimportant tasks. I refer to these unimportant tasks as “busywork.”
Busywork and Productivity
There are a lot of things to get done when you start a business. Some tasks are more important than others, and if you can’t distinguish them, then you’re headed for some rough waters. You see, it’s critical that when you start a business that you experience minor victories along the way. If you consume yourself in busywork then you will become frustrated, and the longer you’re frustrated, the greater chance there is for failure.
Let me give you an example of busywork in the start-up phase. I worked in the same complex with an entrepreneur who was in the process of setting up his business. He determined it was critical that he had five years worth of pro-form a financial statements. In other words, he was guessing, and I mean, guessing, what his profit and loss and balance sheet statements would look like 5 years from now. He spent hours a day crunching the numbers, cross-referencing his excel worksheets and making sure everything was absolutely perfect. Well, he never got to find out if all of his busywork paid off. He stopped his business after a few months because he wasn’t generating any revenue.
So how do you know if what you’re doing is busywork or actual productivity? First you have to know what your goal is. I would advise that your start up goal would be to set up a basic foundation so you can launch your business and begin generating revenue quickly. Second, ask yourself this question whenever you begin a task –”Is this absolutely necessary in order for me to meet my goal?” You will find that at least 50% of your emails you read and Internet sites you visit don’t impact your goal. They are only busywork.
Don’t Be McDonalds…Yet
Oh, the beauty of McDonalds. Whether or not you like the food, their system of operations is a beauty to behold. Everything has its place. Everyone knows what to do. They have every element of work calculated to the second. Everything flows perfectly so that from the time it takes to drive around the corner of the drive through, your order is there waiting for you – even if you order you hamburger without onions. To be that efficient is a small business owner’s dream.
Resist the McDonalds temptation in the start up phase of your business. I’m not saying you shouldn’t focus on streamlined operations in your business, because you should. But now is not the time. It’s not productive at this point. You won’t have that many customers in the beginning. Focus on introducing yourself to the marketplace first. Then tweak your operations as you go. You will find that you’ll learn much more in practice than in theory and you can adjust accordingly.
Remember to focus on only those productive tasks that are essential in achieving your goal. Make every day count and avoid busy work. If you do, you’ll do just fine.
by:David Michaelson
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