Financial Accounting Services – Compliance with Standards

FAC2602-ACN202R-Financial-Accounting-2Financial accounting is a significant branch of every company. It is responsible for the generation of financial statements that are required by external users such as governments, revenue authorities, shareholders, potential investors, debtors, creditors and general public. The statements are produced using detailed accounting information. This information has to be prepared in total compliance with various accounting standards and conventions. This being a time-consuming and expensive process, numerous businesses are now opting for financial accounting services provided by third parties. These are organizations that own fully established data entry centers in the U.S and oversees.

Their line of business is guided by the International Financial Reporting Standards and International Accounting Standards. Every person who starts a small company is not knowledgeable about keeping accounts. The truth is that most people do not distinguish between financial and managerial accounting.

Websites for Accountants Services helps many companies cut costs. It is a leading accounting outsourcing service that caters to small and medium businesses worldwide with a structured process to ensure client success.

 

Financial Accounting

Cash Flow the Core of Credit Management

dollar_keyWe know what is happening with our banking system and businesses both in the UK and abroad are having difficulties getting finance, and the bank is one of the main areas where we discuss our business cash flow issues. We do talk to our accountants, who should be more supportive and productive, I have found to be the opposite in many ways, I am not saying all accountants but there are a fair few that will only do the basics.i.e. VAT Returns, End of Year Accounts and possibly a bit of bookkeeping – they appear to be more interested in the historical data rather than looking to support a company’s future growth

So who else do you turn too, Brokers, Consultants… ?

You need to discuss cash flow issues with experts, specialists in the field of Credit Management, after-all that is their core expertise. What businesses need, is sound guidance and a bit of hand holding when it comes to Cash Management, and accept that as business owners they cannot be expected to know everything. There are huge savings to be made internally, and this is where a business should be looking before they request financial support.

This is a serious flaw, and that is why so many companies fail, because they bury their heads in the sand or they leave this issue far too late and then expect someone to bail them out.

When I was working as a Group Credit Manager, I saw my role as Profit Manager, making sure the department worked to the agreed agenda, whilst looking at ways to save the company’s hard earned cash.

Cash Management is the core of a business, treat it with respect and it will pay you back ten fold. With that in mind, let’s take a look at Cash Management in greater detail.

Cash flow management is vital to the health of your business. The oft-used saying, ‘Revenue is vanity, profit is sanity; but cash is king`, remains sage advice for anyone managing company finances. To put it another way, most businesses can survive several periods of making a loss, but they can only run out of cash once.

The importance of cash flow is particularly pertinent at times when access to cash is difficult and expensive. A downturn creates extreme forms of both of these problems. When the `real economy’ slips into recession, businesses face the additional risk of customers running into financial difficulty and becoming unable to pay invoices – which, allied to a scarcity of cash from non-operational sources such as bank loans, can push a company over the edge. Even during buoyant economic conditions, cash flow management is an important discipline. Failure to monitor credit, assess working capital – the cash tied up in inventory and monies owed – or ensure cash is available for investment can hamper a company’s competitiveness or cause it to overtrade.

Cash flow is the life blood of all businesses and is the primary indicator of business health. It is generally acknowledged as the single most pressing concern of most small and medium-sized enterprises (SMEs), although even finance directors of the largest organisations emphasise the importance of cash. In this current economic climate, where access to liquidity is restricted, cash management becomes critical to survival.

Credit Management

Corporate Structure – A Wise Choice

downloadHow many people go into business and never set up an entity structure? Thousands of business owners are sole proprietors which can be very costly. Setting up a business entity does not take a lot of money and is well worth it in the long run. The type of business structure you pick is determined on a variety and factors and it is best to ask your accountant which one is appropriate for you business. In most cases they will say and S corporation or an LLC. If you plan to raise capital a C corporation may be more appropriate.

Setting up your entity structure is an easy way to increase profits without doing much of anything. Once it is set up, you will be able to reap the rewards year after year.

If you do not think you can afford advice of a lawyer or accountant, than contact Legal Zoom. They will at least lead you in the right direction. You can even set up the entity with them directly. Even though there may be tax benefits to filing in other states, it is best to incorporate in the state in which you live. You accountant is familiar with the state laws and there is a better chance things will not be missed when filing.

Make sure your accounting books start clean and stay clean. The worst thing you can do is start mixing business and pleasure. It creates a nightmare not only for you, but if you are audited, it can create havoc in your life.

Take time to set up categories and your accounting books correctly from the start. Have business systems in place that ensure that all of your bases are covered and you are not scrambling when it is tax time. Even have a separate credit card for all business expenses. Label receipts and file them on a regular basis.

This all sounds so elementary, but then again, most people do not take the time to set things up properly.

If you have questions after your initial set up, do not hesitate to contact your accountant and/or bookkeeper to ask them questions. And that brings up a very good point, never hire an accountant or bookkeeper that charges you to ask questions. Some firms are set up similar to a lawyer’s office. Too many surprises happen this way. Think of your accountant as a mentor.

Corporate Structure