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The Importance of Accounting for Small Businesses

The Importance of Accounting for Small Businesses

Accounting is one of the least-loved aspects of any small business. However, it is one of the most important parts of running a successful company. The Write Hand is here to help, throughout all your bookkeeping and accounting woes.

The Importance of Accounting for Small Businesses

Bookkeeping is necessary in any business. As a small business owner, it’s important to recognize that the best practices used by Fortune 500 companies also apply to you. Following basic accounting principles is essential for success in any size business; savvy record-keeping and financial analysis is key to not only monitoring your expenses, but to discovering new avenues of growth. In addition, it ensures you stay responsible for tax obligations to the government and to your employees.

small business accounting

Accounting entails more than just managing credits and debits, and it comes into play more often in everyday business decisions than you may realize. A few examples include:

  • Closely monitoring your accounts receivable to illustrate trends or behaviors in your customer base. It can also cut down on the costs you incur by pursuing late payers.
  • Establishing a detailed budget to help discover inefficiencies within your operations.
  • Sudden changes in vendor costs or sales revenues can alert you to important industry changes.
  • Understanding your financial position in order to spot problem areas that could interfere with loans earmarked for expansion.

As you consider your accounting strategy, review your company’s financial goals. Whether you are a solo entrepreneur or you employ a staff, your survival hinges on clearly stated financial objectives. You may be in business to reap as much profit as you can, or you may be interested in sharing a product or service that you believe in. Either way, experts agree that one of the most common reasons small business fail is because cash flow runs dry. To prevent this disaster, your business should implement policies for efficient record-keeping and a sound financial strategy.

Taxes are unavoidable. Depending where you operate and the nature of your business, the IRS has very specific requirements about the documentation you’re required to file. Submitting improper or inaccurate documentation can get you into trouble, and it can be extremely costly in terms of fees and penalties. Preparing the required tax documentation has its benefits though, and it can give you vital information about the health of your business. Monthly or quarterly financial statements, cash flow statements, and asset and income statements can provide a clearer picture of your business than your bank balance. Understanding IRS requirements and how you can make them work for you can give you a deeper understanding of your company’s financial health.

small business accounting

What information should I be tracking?

If you haven’t had formal training in accounting or are more interested in other aspects of your business, keeping meticulous records of financial data can be a chore. Furthermore, understanding precisely what information you should be tracking can be overwhelming and confusing. Most small businesses should track the following categories of data:

How should I track these metrics?

Though it’s quite common for small business owners to have a spouse or family friend “do the books,” effectively managing your small business’s finances goes beyond bookkeeping. Properly strategizing for your company’s future, as well as meeting your legal requirements, is best achieved with professional accounting methods. This is particularly true if you’re too busy or too uninterested in the nitty-gritty details to analyze the numbers. At this stage, successful small businesses consider either outsourcing their accounting needs or investing in accounting software. Each option has its pros and cons.

For many startup companies, funds are tight and it may be tempting to pursue the cheapest method. Because your legal requirements are only due once per year, you may choose to ignore it all until tax time every spring. Remember, if you choose this option, you’re essentially opting out of receiving crucial data that can encourage success. The short-term solution may not be the best one, and it pays to do your due diligence when making this critical decision.

Read more about accounting and bookkeeping resources here.

Find more accounting and virtual assistance help from The Write Hand LLC.

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17 Apps Every Entrepreneur Needs in 2017

17 Apps Every Entrepreneur Needs in 2017

Being an entrepreneur with my Online Business Management and Virtual Assistant network, I was quite curious when I read the title of this article. But them I was rather shocked when I read the list of apps. I don’t use any of the apps listed and I am a rather successful entrepreneur; go figure. I’m going to check out some of the apps in this article and see how they fit into my life and my company. I’d also like to add a few apps that I find exceptionally helpful…

Pages for FB – I manage a lot of client FB business pages and this app is a one stop way to keep them all straight without having to go to my own FB; this keeps me from getting side-tracked by my own FB shenanigans.

Groups for FB – Similar to Pages but as the name implies it helps you manage all the groups you’re in on FB. Again, I can manage these groups or post in these groups as needed without getting sucked into the FB vortex.

RoboForm – I have a boatload of logins and passwords for myself and all my clients. This is a password and auto refill app that helps me keep everything straight and gives me access to all my passwords across many devices. The security is above great and highly recommend this app.

HootSuite – With all the client social media we manage, HootSuite is a wonderful tool I can use from my laptop or iPhone. We are able to make social media posts to a boatload of social feeds such as FB pages, FB groups, LinkedIn, LinkedIn groups, Twitter, and so much more. You can setup your posts immediately, a future date, or even allow HootSuite to choose the best time for the most traffic.

DropBox – I have loads of information that has to be saved for myself and clients. This is a cloud based platform for saving all your files. Once you set it up, it functions just like your folder in Windows; no need to go to the web-based platform unless you have a unique reason to do so. For iPhone, with one tap you can download your pictures and save them at any time. This is awesome considering how many photos I take. I save them and then delete the ones I don’t need access regularly; saving value space in my phone’s memory.

BaseCamp – I recently purchased a subscription to BaseCamp and I swear it’s a fabulous project management tool. Whether using it on my laptop or my phone; I can be in constant communication with my team. BaseCamp is a wonderful way to setup clients and projects while assigning tasks and so much more. It keeps me and my clients project well organized and keeps my team on task and on schedule.

17 Apps Every Entrepreneur Needs in 2017

If you’re like most people in business today, there always seem to be a million things on your to-do list and you don’t know where to start.

You need to conduct research, streamline collaboration, increase communication, sell your wares, reach your fan base, log your time and keep track of your accounts, to mention just a few. How the heck will you do it all? Well, there’s an app for that.

In fact, there are quite a few. Here are the top 17 apps every entrepreneur should be downloading to make the most of each day.

1. Accompany
Touted as a virtual “chief of staff,” Accompany does all the research necessary to prep you for big meetings by emailing you a concise briefing beforehand. It provides you with all the pertinent information you will need to succeed in any situation. Accompany works by connecting to your Google or Microsoft email account, your mobile calendar and your Facebook and Twitter accounts. It examines your personal data and goes through biographies and other information online to create summaries of each of your contacts.

2. Pocket
This “save for later” app allows you to file away useful articles, interesting videos and any other content that you want to hang on to for future use. When you find something you want to view later, simply put it in your Pocket, and you’ll be able to access it from your phone, tablet or computer, even without internet access.

3. Slack
This team communication tool gathers group exchanges into one place, making information instantly available and searchable wherever you go. This cloud-based collaboration application began as an internal tool used by a now-defunct online game. Slack is currently the fastest-growing B2B application, used by over 4 million active users every day.

4. Motivation Daily & Positivity
If you are looking for a daily dose of motivation to keep you on track to achieve important goals and big dreams, this app is for you. It comes in a streamlined, simple format, which includes perfect quotes to keep you focused when you’re tempted to slack off. Whether you’re pursuing health and fitness goals, prepping for a major project at work or school, or just need some inspiration, this app will help get you there.

5. Buffer
As a powerful social media publishing tool, Buffer streamlines the process of reaching your fan base by making it easy to schedule content on social media. It helps increase your reach by ensuring you get the most out of each post. With one click, you can share content across multiple social networks and ensure that it’s posted at the optimal time so more followers will see your updates.

6. Salesforce1
Salesforce1 empowers you to connect directly with your customers and run your business from your phone. It channels all your customer information into a single, integrated platform, enabling you to build a client-centered business that includes marketing, sales, customer service and business analysis. This gives you a more complete understanding of your customers, allowing you to drive your business’s success and make smarter decisions from anywhere in real time.

7. Square
Square credit-card processing works for any size business, and is easy to do from anywhere. Square allows you to accept Visa, MasterCard, Discover and American Express, all for one low rate. Once you sign up, they will send you a free magstripe reader (their newest reader even takes chip cards). Or you can use your iPad in a Square Stand for countertop sales. The Square Register app also includes other useful tools to help you manage every area of your business.

8. Toggl
Toggl is an insanely simple way of tracking and logging your time that eliminates the need for timesheets. This app allows you to track time from a browser, computer or smartphone so you never again lose a minute of billable time. You can organize your time by project or tag, and mark as billable. If you forget to turn it on, just enter the time later.

9. Trello
Trello is collaboration tool organizes your projects into boards, lists and cards so you can better prioritize work and life. At a single glance you can see what’s being worked on, who’s working on what and where in the process a project is. It makes project management–which can include work assignments, family chores or travel plans–easy and enjoyable.

10. MobileDay
This one-touch dialing app gets you into all your conference calls on time and unflustered. With MobileDay, there’s no more searching for misplaced conference call PINs or passcodes. The app auto-syncs with your iOS or Android calendar and plugs you into your calls with one click, so you can connect to that business call from anywhere.

11. Workflow
Workflow allows you to connect the best features of your applications, so you can combine multiple steps across a number of apps into a single tap. With Workflow you can create shortcuts, manage your media and share content. It has been lauded as the “Swiss Army knife” for completing complicated tasks, and basically feels like you’re designing your own app (but much easier).

12. Box
Box offers a simple, secure way to share files and collaborate with coworkers, customers and partners. It allows you to centralize your files, keep your team on track and simplify workflow, not to mention ditch email attachments. You can create, edit and review documents with others in real time from anywhere and on any device, and can view full documents without needing to download the file first.

13. Wunderlist
Wunderlist helps you tick off your personal and professional to-do list by getting your life in sync and making it easy to share your lists. A cloud-based task-management application, it makes sharing grocery lists, working collaboratively on projects or planning household activities and vacations easier. It syncs with your phone, tablet and computer so you can access your lists from anywhere.

14. CloudMagic
If your inbox fills up quicker than a sinking ship takes on water, you need CloudMagic. This email management application is known for its searching capabilities, cross-platform capabilities and user interface. It can scour all of the email you’ve ever received to locate exactly what you’re looking for. It supports multiple accounts, and even includes a feature called Cards, which connects services like Evernote, Pocket, Trello, Salesforce and Microsoft OneNote. This makes it easier for users to get the information they are looking for without leaving their email.

15. Wave
Wave helps you create and send professional invoices, estimates and receipts in seconds. It keeps your business organized and running smoothly by tracking income and expenses effortlessly, with receipt-scanning tools and bank connections. It includes a suite of online small-business software products, including direct bank-data imports, invoicing and expense tracking, customizable charts of accounts and journal transactions.

16. HelloSign
HelloSign is the easiest and simplest way to handle contracts or other agreements on the fly, because it lets you view and sign without visiting the office. This app also eliminates the burden of needing to print, sign and scan a document to be sent back. It allows you to just use your fingertip to sign any PDF file and forward it to the necessary party.

17. 1Password
Do away with all those sticky notes with your passwords scrawled on them. 1Password allows you to collect all those codes in one safe place online. This app keeps all your passwords and important information protected behind your Master Password. It has extensions or plug-ins for all the major browsers, and can securely store other things, like credit cards, bank accounts and licenses. You can save all the entries from a webpage form, so you can remember answers to security questions or other information.

 
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Posted by on August 29, 2017 in Entrepreneurship

 

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