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Top 5 Reasons Why a Small Business Should Do Bank Reconciliation Small businesses are always strapped for cash and are looking for ways to manage it better. Cash is vital for operating as well as growing a business. What if I told you that there is a simple way to track cash flows. You can do this by preparing a monthly bank reconciliation statement. What Is Bank Reconciliation? Bank reconciliation is the process of comparing the transactions in accounting ledgers and the entries in the bank statement. Here we verify every entry to ensure that the amounts match. If there…
Most startups are on a tightrope when it comes to funds. And appointing a CFO would be the last thing on the mind of a startup owner. The general mindset is that CFOs are for multi-million dollar corporations, and startups don’t need them. However, this is a misconception and could not be further from the truth. A CFO can shift the gears for a startup looking to grow. However, appointing a full-time CFO might not be feasible for a startup, but outsourcing to CFO services is definitely worth considering. In this article, we present some solid reasons to show how…
Tax preparation and filing are crucial for every small business, but so is tax planning. It is surprising how many small business owners tend to neglect this important activity. It is not easy for Small Business Owners to devote time to tax planning. However, planning is a must to stop taxes from eating away a significant portion of your hard-earned income. Tax planning is all about being proactive. Understanding and implementing tax-saving strategies early on in the year will set you up for a stress-free tax season. So, shall we explore why a small business should do tax planning? What…
  7 Essential Qualities Of A Good Bookkeeper For A Small Business   Most small business owners think they can manage everything on their own. They want to control every aspect of their business. Even functions like accounting and finance. It is common to find entrepreneurs doing the bookkeeping themselves. One reason for this might be to save money. Or they might not know the value of a bookkeeper for their business. But let’s get real here. No one can do everything. As a business grows, you may need to appoint a bookkeeper. Now you can concentrate on your business…
Top 10 IRS Income Tax Audit triggers 1. You did not report all your income.  easiest to avoid, more overlooked, Auto audit – at least letter audit 2. You took the home office deduction. 3. Claiming 100% of Business use of a Vehicle – Need specific purpose. 4. You had unusually large business expenses. – Travel, Meal expenses by Industry norm – 20% above norm gets audited. Mixing Business & Personal expense. 5. You made large charitable contributions.  – 60%. 6. You reported several years of business losses. 7. Audit Rates by Income Category   – Total 150M Tax Returns filed…
In accounting, a key term to know is “internal control.” Internal control is the series of processes and procedures that are performed within the organization to ensure the integrity and accuracy of the financial information and reporting of that organization. Internal control is very important to consider in order to protect the business owners, employees, vendors, investors, and other stakeholders. In a small business, maintaining good internal control is often a challenge since staff size is smaller and resources are limited. Yet, it is essential to understand so that the business owners understand what risks they are taking every day…
5 Effective Ways To Improve Accounts Payable Process Using AP Automation   In today’s stressful times, a business to survive has to focus on both revenue generation and cost reduction. A two-sided approach is the way to stay sustainable. Businesses are realizing that revamping their processes is a must to better utilize resources and grow. One of the processes that is suitable for this overhaul is the accounts payable process. Duplicate or late payments, slow processing of invoices, higher data entry costs all put a dent into the profits of a business undertaking. The way to deal with this is…
Small Business Tax Returns: 5 Mistakes to Avoid As a Business Owner   If you are a small business owner, then filing tax returns is not something new to you. But more often than not, taxes and the process of filing them is something all business owners dread. Unless, of course, you are a super-duper taxation ninja. Filing taxes is an essential part of a business, and the sooner you get comfortable with it, the better. Even simple mistakes during filing can cost you higher tax payments and lower deductions and refunds. Serious errors can also get you on the…
Sometimes it’s hard for business owners to know how to take their businesses to the next level of growth and profitability. If you’ve been stuck at the same revenue or profit level for a while, it could be because knowing how to scale your business is not a skill in your skillset — yet. Enter a classic management book on scaling: High Output Management by Andrew Grove, ex-chairman and CEO of Intel. While it was written in 1983, it has made a recent comeback in Silicon Valley but is still not well-known outside of the Bay area. Many people who…
Small businesses sometimes run as either little firms, or partnership companies, or ownership issues. several little businesses fail as a result of they don’t have a correct tax strategy.  If you are a Small Business Owner and are not maintaining your books, when the tax time comes you are handing over a handwritten note or excel spreadsheet, or shoebox of Receipts and expenses to your Accountant, just so you can file your taxes. A. What is Bookkeeping :  The activity of keeping records of the financial affairs of your Business. B. Why is bookkeeping important : Tax Deductions   – so do not miss claiming any expenses. Business Loan – When you apply…