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Businesses generally make extensive use of spreadsheets both in accounting and all other business fields. Being a numerically based system of analyzing information spreadsheets are used throughout every accounting function as the technique presents an ideal basis to maintain accuracy and automate the collection of financial information.

Every small business needs to keep records of sales invoices and income received and purchase invoices in respect of expenses. It is not sufficient for accounting and taxation purposes for these receipts and payments to be left in the office or the back of a van in a carrier bag.  At some stage these prime bookkeeping documents need to be processed. Read the rest of this entry »

On July 30th 2002, President Bush signed and approved the Sarbanes Oxley act. Thereafter, this act has turned over the processes of the financial reporting. This article aims to make you acquainted with the policies of the Sarbanes Oxley act. In this article, you will find a Sarbanes Oxley overview.

With the implementation of this act, the Congress is now able to make certain changes to the financial reporting process in corporate world. The major changes include certification by the officers and real-time disclosure of information. This act strives to make the policies and the business of the public companies transparent and to increase the independence of the companies as well as the issuers. Read the rest of this entry »

Double entry bookkeeping is an accounting technique to record the financial transactions of a business where every transaction is entered twice, equal and opposite transactions. Double entry is required for all businesses that must produce both a profit and loss account and a balance sheet.

All limited companies are required to produce a statement of assets and liabilities and maintain a system of financial control and invariably need to adopt a system of double entry bookkeeping usually using an accounting software package. Read the rest of this entry »

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. Read the rest of this entry »

Running a successful business is no longer a child’s play. Through ages, it has been seen that many people start off with a new business only to shut it down later. This happens only because the proprietor of the business fails to manage the business efficiently and therefore, misses his or her hold on the business. Managing a business is not a cakewalk. One has t be highly conscious of all the things that are going on in his business. In fact, he or she needs to look through all the sections of his or her business and especially, through the accounts or the bookkeeping department. This is one of the most important and trusted departments of any organization, irrespective of its size. It is a known fact, that the bookkeeping department of an organization can make or break the organization. Therefore, one really needs to be careful and one has to have tremendous finesse to work in the accountancy department of a firm. However, at times getting the bookkeeping work done from in-house employees becomes problematic and in such situations, the best thing that a proprietor can do is to outsource the same services from any bookkeeping firm that has its operations in NYC. Read the rest of this entry »

Did you know that around 50% of small business owners don’t use saccounting software to process their accounting information?  Many resort to the excel spreadsheet to keep track of money coming in and money going out.  These small business owners would rather get on with their core business than worry about the administration tasks associated with accounting, even with a software package, because it seems like such a waste of time. Read the rest of this entry »

Are you tired of not making any money? Then, now is a good time to fire your accountant and find a better one.

Thirteen years ago Hot Rod and I went shopping for an accountant.  Hot Rod’s buddy and partner Richard Yox had just died.  Yox had always done the books and filed the tax returns.

Yox took an aggressive approach to the IRS.  He was cross-hair-focused on making sure that Uncle Sam didn’t get one extra penny from Hot Rod & Yox Plumbing and Heating.  They got audited once in 1981.  The IRS wrote HR&Y a check for $11.  Since then we’ve never been audited.  I’m crossing my fingers and knocking on wood that I don’t ever have to go through an audit.  I suspect, however, that after dealing with Yox, the auditor stamped “DON’T GO THERE” on our file. Read the rest of this entry »

Every business functions through a range of disciplines, sales and marketing, operational skills, purchasing and management. A small business accounting software is also an essential tool to bring financial discipline to the business. No matter how skilled and well trained the business every small business needs a full range of functions to reach the highest levels of success. Read the rest of this entry »

If you were driving 80 miles an hour, in the dark, with your lights off, heading towards a cliff, would you like someone to yell, “STOP?”

OK.

Stop!

Do you produce financial reports - the balance sheet and income statement - every week?  Do you analyze sales, costs, cash flow, and debt every week?  If not, you may be heading for the cliff. Read the rest of this entry »

Discounting of Revenues and Expenses

Business valuation involves the study of many aspects of a business, including anticipated revenues and expenses. Because cash flows extend over time, a discounted cash flow (DCF) model can be a helpful tool.  A discounted cash flow analysis for a business valuation requires the analyst to consider two components: (i) a projection of ongoing revenues and expenses of the foreseeable future; and, (ii) a determination of the discount rate to be used. Read the rest of this entry »