What Does Your Accounts Receivable Balance Tells You

 

Account receivables showing there on balance sheets clearly should be interpreted as the amount the company is assured of being paid by its liable customers at a particular date in the near future. But it’s not guaranteed that the company will be paid a certain amount in the future, it surely depends on its customer’s reliability, trust, and their financial backup.

What do we understand by Accounts Receivables?

In any firm balance sheet, the accounts receivable column depicts the money it is owed by its customers in exchange for any goods or services rendered. Suppose ABC Company agrees to make the sale of $1000 worth products to its customer XYZ on net 90terms. It means the customer has 90days from that day to pay the amount of $1000 to the seller of the product. The accounting transactions passed when sales made are as follows: ABC Company records the sale of $1000 as a receivable debiting its account receivable account. This entry shows that the amount here is classified as the revenue to the firm at the moment the sale happened, rather than when the cash is in real received, a $1000 credit is also made to the revenue account on the balance sheet which balances the entry. Hopefully, when the customer actually pays within the set 90 days, ABC Company reclassifies the amount of $1000 as cash on its balance sheet by making a transaction. Debiting the cash account and crediting the accounts receivable account means the customer’s account.

Resource: https://accountsconfidant.com/what-does-your-accounts-receivable-balance-tells-you/

 

 

Why Reconciliation Is The Most Crucial Step To Accuracy

Bank Reconciliation Services reduce the errors that could have been caused at either end by verifying all the records. It ensures more accuracy, the bank statement balance of the customer is reconciled, with the balance in the client’s financial software, the results from both the ends should be same to ensure that no theft or fraud has taken place. Hence It ensures accuracy.

All the accounting errors can be removed by account reconciliation as it helps you to identify the errors easily. It is a crucial step that needs to be performed to ensure that there are errors in the record.

source: http://accountsconfidant.com/why-you-need-to-outsource-your-bookkeeping/

Your Business on Track with Bank Account Reconciliation Services

Every month, the bank takes out a banking statement of all your business’s transactions of each bank accounts of your business of that month. The amount of money debited, credited, the date on which the transactions took place and the charges made by the bank to the account are all mentioned in the books, which is called bank statements. The same transaction statements are sent to the company- which are called Cash Balances. At the end of the month, Cash Balance and Bank Statements should match. This process is called Bank Account Reconciliation. Read more

Top 4 Virtual Accounting Concerns of Business Owners

Virtual accounting services are the modern services to handle accounts, by hiring a qualified person who can work for your company remotely. It has proven to be an efficient way of managing accounts by engaging a virtual assistant for accounting services who works for your company. Virtual accounting business services have been gaining a lot of popularity because of the wide variety of benefits it provides. They are efficient, flexible, and cost-effective. They have helped companies to grow their companies as the company can focus on their core business while someone else takes care of the accounts of the company. May it is professional bookkeeping services for small business or handling accounts for large companies, virtual accounting has proven to be beneficial in all cases.

While the benefits of virtual accountancy are immense still the business owners suffer from certain concerns before hiring a virtual accountant. Although Virtual accountancy enhances productivity and improves efficiency still many business owners hesitate before switching to virtual accountancy. Here are a few common reasons why business owners hesitate to opt for virtual accountancy:

1. No personal contact with Virtual Contact:

This is a major concern of all the business owners. As the virtual accountant works for the company remotely instead of sitting in the office provided by the company, that is why owners hesitate to share their company’s information with a virtual accountant. Business owners feel uncomfortable sharing information over the internet. Although it is beneficial to communicate through forms like calls, messages or e-mail instead of wasting time in the meeting, yet owners suffer from trust issues with a virtual accountant. O solve this one can trust a virtual accounting service provider. The professional companies that offer accounting services and remotely manage the accounting tasks for any business group rather than physically working at their location are known as Virtual Accounting Service Provider. These companies provide a safer accounting method as they perform background checks on its professionals and are covered by fiduciary insurance to protect the clients from any fraud.

2. Issues in managing Virtual Accounting Team:

It is believed that handling a virtual team is more difficult than handling a team who works in your office. As providing instructions over the internet is more complex than providing instructions in real time. Also as you have no personal contact with your virtual team it becomes difficult to gain a control over them. This problem can be solved by using proper techniques. It is easy to have a hold of your team virtually with proper communication and understanding with employees.

3. Security issues with data:

Many business owners feel that once the data of their company is shared over the internet it is not secure anymore. There is a risk in sharing accounts detail over the internet as any information on the Internet can be easily accessed with modern techniques. The fear of hackers intruding into sensitive information makes business owners more concerned about virtual accountancy. This problem can be solved by connecting with a trustworthy virtual accounting firm that uses safety measures to protect your data.

4. Losing control over own business:

Some business owners believe that sharing details of their business with another person virtually can make them lose control over their own business. With virtual accountancy, the business owner has the right to all the information like accounts receivable, accounts payable, income statements and balance sheets and financial reports. All of this information is updated and delivered regularly; hence the business owners have full access to all the information

We can realize that virtual accountancy brings some major concerns to owners but with new and updated techniques there is a solution to all the concerns business owners have.

Why Flexibility Matters When It Comes to Payroll Processing

A payroll is basically a document showing the distribution of total money that a company is liable to pay to its employees. It shows the records of the salaries and wages that all the employees of the company get. It also includes bonus distribution and tax provisions. Payroll processing involves execution of the calculated salaries and bonuses to the employees.  It involves maintaining a balance in the payroll data just as a balance sheet and reconciling or correcting any error causing disbalance. The process is a complex one and hence may require some companies to hire a payroll service provider.

When we talk of payroll processing, we generally don’t consider the option of flexibility. More specifically, we don’t think that the element of flexibility would fit into payroll process. The obvious reasons being the pay dates and tax filing deadlines are not flexible but fixed.

Evolution in payroll process

With the journey of payroll from being a simple obligation to being a stressful task, it became quite important to introduce new and flexible payroll options. It is not necessary that any company will prepare its payroll exactly on the scheduled time. There may be instances where the company has to go ahead of the schedule to pay its employees. Furthermore, the chances of errors in calculations are also unpredictable. Thus, the need of options that would make payroll quicker and stress-free. These options are – Same-day payroll, next-day payroll and cancel payroll.

Same day and Next day payroll

As already mentioned, there may be instances when company needs to ignore the scheduled payroll date and execute payrolls of certain employees. These instances may arise when an employee is in sudden need of money for some reason. Or when an employee decides to resign in the middle of a month.  In all such situations, the same day and next day payroll services can turn out to be a blessing. A same day payroll service allows the company to execute the payroll on the same day as scheduled. Next day payroll, on the other side, enables a company to execute it on the next day of the scheduled business day. Such services are required the most by small businesses which do not have adequately qualified employees to give away payrolls on such a short note and without errors.

Cancelling Payroll

Errors in payroll can strike back to the company really hard. An error may create hustle among employees and develop pressure in the management. But it doesn’t end here. It has a greater impact causing a greater result of a petty mistake. An error in a payroll implies an error in tax payment. This may result in penalties levied on company by the government authorities.

Hence, cancel payroll is opted. At times, when people make mistake while calculating the wages and bonuses, leading to underpayment or over payment, they have to cancel the whole payroll.  This can be time consuming and expensive. But, if someone spots an error in payroll shortly after execution of payroll, one can select cancel payroll option. It will stop the payroll execution process right in the middle of its track and the person can start fresh with the correct amount in the payroll.

Payroll processing is not an easy challenge to take. While preparing payrolls, one has to keep in mind a lot of factors.  The person must take into account all the legal obligations such as minimum wages to be paid, tax deductions, paid holidays, paternity or maternity leaves to be paid ( if any), loans for children and any other perquisite that the company is giving to its employees. Thus to cover up errors in processing and to facilitate emergency payroll executions, flexibility in payroll processing is of great significance.

Why do you need to Outsource your Bookkeeping?

PROFIT is the word towards which all the predilections of a business are directed. As it is one of the major aspects of business growth and expansion. And THIS is where proper bookkeeping and accounting plays an important role to keep a check on Financial Transactions of a business.

It is quite obvious for an Entrepreneur or a New Business Owner to understand that, without quality bookkeeping, you will not be able to know about the cash flow, whether you are meeting your goals or even running a business successfully.

source: http://accountsconfidant.com/why-you-need-to-outsource-your-bookkeeping/

Unable To Keep Up With The Changes In Business Accountancy?

Accounting experts in the current times are discovering about the fact that they need to constantly learn, unlearn, and relearn in order to keep their position intact in this fast-changing business accountancy landscape. 

Bookkeepers & accountants all over the world are facing the heat of the rapidly emerging technologies in the business accountancy domain such as blockchain, AI(artificial intelligence) & RPA (Robotic Process Automation). The said technologies are quickly changing the [profession of a business accountant with every single day passing by. 

source: http://accountsconfidant.com/rapid-changes-to-business-accountancy/

Role of Virtual Bookkeeping for your small Business Growth

What is Virtual Bookkeeping?

Virtual bookkeeping is the process in which an accountant or a bookkeeper provides the services of accounting to their clients remotely. Conceptually, it is similar to on-site bookkeeping, but, is not location based. The entire procedure involves the sourcing of documents or transactions i.e. bills/invoices/receipts etc electronically and then, updating those transactions online.

Features of virtual Bookkeeping

Some of the major features of bookkeeping are:

• Easy and Flexible Communication: Working with a local onsite bookkeeper, you end up with a limited geographical area. But, with virtual bookkeeping, the services are provided irrespective of any locations. All the queries related to finances and accounting are answered over a call and is provided with expert advice. The added advantage is that these services are available 27/7.
• Cost Effectiveness: Virtual bookkeeping services cut down the manual cost by half. You need not worry about hiring someone for in-house. This means that you need not worry about office space, leaves, pay, employ benefits and other similar concerns.
• Simple and Fast: After procuring the data from the company, the tole of the virtual bookkeeping services lie in input all the data, double check for the accuracy, and then send the key financial reports within a stipulated time frame.
• Experts at your service: Virtual bookkeeping services ensure that all the data of the company are taken care under the supervision of expert professionals. They also work in terms of providing advice to the company for betterment.

“Have you ever thought what will happen if your in-house bookkeeper quit the job all of a sudden and have deleted all your financial data?”

Circumstances may arise when your bookkeeper suddenly left the job. Is there anyone in place to pick the job where was it left? If you are struggling to find a qualified bookkeeper to take up the job efficiently, then, nothing would be much better than virtual bookkeeping services. This service hires the most qualified professionals who are trained efficiently and understand the value of the business they are hired for. They will deliver all the reports and statements on a daily basis, thus helping you run your business perfectly.

Working of Virtual Bookkeeping Services

• Consultation: Consultation/Discussion is done either personally or via video conferencing
• Legal: Drafting of client and confidentiality agreement.
• Accounting Software: Choosing the software through client
• Receiving of documents from clients: First, a checklist is sent from the service to help prepare the source documents. This checklist contains all the lists of data required and the method of organizing them. Then, the bookkeeping documents are sent by the clients in various methods.
• State of Bookkeeping: Once the documents are received, the professionals start working on it using the chosen software.
• Reporting: After the completion, the final report is sent electronically.

5 Ways You Can Manage Your Business Leveraging Personal Bookkeeping

Working smart with your bookkeeping can save you a lot of effort & hardships when it comes to tax-filing. But, when it comes to managing personal bookkeeping, most entrepreneurs do not know where to start with. Personal Bookkeeping pays off big time if managed systematically by entrepreneurs, small business owners & startups.

You can manage to capture all expenses & not missing write-offs, on your own. This will further empower you to make better management decisions all through the year. You will not have to wait for several months in a row to perform analysis on income & expenses in a category-wise manner. Personal Bookkeeping can further make you feel relaxed, knowing that you are taking care of your financial books on your own. Further, it will allow you to save money on subscription fees that you would otherwise pay to a professional bookkeeper.

Personal bookkeeping, as a matter of fact, will further result in proactive tax planning throughout the year & will allow you to save more on taxes when the time comes for tax-filings & submissions.

To have a strong hold on your business books, you should have a system in place that you need to follow religiously.

5 Ways To Manage Personal Bookkeeping Without Investing Much Time Into It

 

1. Learn Feeding In The Inputs By Yourself & Get A Hold On The Basics of QuickBooks

We all know that this is not easy to do it by yourself, and in the first place looks like impossible to achieve. In fact, this might be the reason for your books not getting updated at regular intervals. We would like to recommend you to spare some time and learn the basics of bookkeeping. You must be able to at least printout reports & evaluate your staff’s accuracy in terms of the work done by them.

2. Hire a Close Relative To Get Your Personal Bookkeeping Work Done

This could be a great idea in the context of getting your financial books managed, where you are giving an opportunity to a young adult in your family to earn and at the same time learn the much crucial entrepreneurship skills within the whole process. He(the relative) will be learning about the know-how related to the running a small business. By doing the books, he will also make sure to save you more money.

3. Take Personal Bookkeeping Assistance From A Local Bookkeeper

It could be the assistance taken from a local college student who is looking for an internship. Or, it could be a seasoned bookkeeper who agrees to offer his support at reasonable prices. This will prove to be an affordable option for you, that will also save you time to focus on your core business competencies.

4. Hire Someone As An “In-House” Bookkeeping Support

In the personal bookkeeping domain, it is always advisable to hire a local in-house bookkeeper, whether on a part-time, or a full-time basis. You can have this person coming to your facility for a few hours in a day, or on a weekend basis, and can pay to him on an hourly basis. What this person can contribute is, that he will input the financial data into your accounting tool & will print out the reports for you.

You might need to supervise him a little or getting him trained by your outside CPA, but then, keeping his low wages in mind, it’s still profitable to have someone working in-house & maintaining your business books.

5. Hiring a Seasoned CPA Or a Highly-Experienced Bookkeeper

There are many small business owners out there that only love expert assistance and keep themselves away from the risks associated with hiring a young or an inexperienced professional in terms of accuracy. They simply want their books as well as tax planning to be taken care of by the experts in the domain. It is definitely more expensive, but the future impact of it might exceed the costs that they pay in the present times. Besides, it is also considered the safest option in the personal bookkeeping regime when evaluated basis the future impact.