Accounting

The decision to let go of your business bookkeeping is not one that people take lightly, after all, you are letting a stranger into the inner sanctum of your business and private life, and your finances.

So how do you know that they are trustworthy, responsible, discrete, accurate, professional and competent?

Most employees or subcontract service providers you take on are there to provide a relevant service for your business and it is quickly apparent when they cannot perform. For instance, a salesman who upsets all your customers, a secretary who can’t keep a polite tongue in their head under pressure, a worker who cannot get to grips with a process…

But bookkeeping is unique. 99% of business people don’t know the first thing about it and simply muddle through. Because it is outside of such a high percentage of business people’s comfort zone, there is a considerable positive attraction in getting someone to deal with this time consuming, tedious and mysterious side of their business. But how do you assess if they are likely to perform well, or make a complete hash of all your records.

So when looking for a bookkeeper, or a bookkeeping service, here is a simple list of questions to start with:-

1. Are they experienced in their craft and able to give you current businesses to ring to test out their claims?

2. Are they familiar with your kind of business?

3. Do they have the technical ability to reconstruct the records when most were lost in that flood last year?

4. Are they answerable to a professional body?

5. If they take your records away to deal with - what guarantees do they offer about security and return of the documents?

6. If they take your records away to deal with - do they use bookkeepers living and trained in the UK?

7. Do they dictate what form your bookkeeping should take, or what package they insist on using?

8. Do they have access to fully qualified accountants to answer questions if they get stuck on some technical points?

9. Will their work withstand the intense scrutiny of an in-depth Tax or VAT investigation.

10. Are they up to date with all industry, Tax and VAT regulations about what you can and can’t claim?

11. Will they start from today, or will they go back to the start of your current financial year and bring your records up to date first?

12. Will you be able to get the reports you need from them on a timely basis?

13. Are they prepared to put their name to your VAT Return and sign it as a responsible official?

There are many more questions you should be asking but my bookkeeping bureau ticks every box that comes up.

Ray Stewart ICPA FCCA

Ray Stewart is the MD of Coalville Business Services Limited. He writes articles and reports about bookkeeping and business growth strategies, the two areas of business he is most passionate about. His bookkeeping business website is at http://expertbookkeeping.info and is a free resource for people looking for simple answers to bookkeeping questions and a chance to speak to him for free if you can’t find the answer you are looking for. You can also visit his ecademy profile at http://www.ecademy.com/user/raystewart and join his network.

One thing you can always count on during an audit is a request for documentation supporting meals and entertainment expenses. The IRS has found that these expenses are heavily abused and are an easy way to generate additional tax revenue, not to mention additional revenue from penalties and interest.

You don’t have to spend a lot of time reading tax cases to find one where meals and entertainment expenses were disallowed specifically because of improper documentation.

*Here are a few examples from recent cases:

The taxpayer’s business meal expenses did not satisfy the substantiation requirements because they did not include the taxpayer’s relationship to the parties involved or specify the business purposes of the meals.

The taxpayer’s meals and entertainment deductions were disallowed because the taxpayer couldn’t provide anything to tie the deductions to specific copies of receipts, checks, or other documents. Plus, in the few records the taxpayer did provide, there were duplications and other irregularities in the records making them unreliable altogether.

A spreadsheet listing the numbers the taxpayer put on his return was insufficient to substantiate or use to reconstruct business expenses for meals and entertainment.

This means that even if a meal or entertainment expense is perfectly legitimate, it can be disallowed if the documentation is not proper!

How to Protect Your Meals and Entertainment Expenses:

In my teachings, I dedicate an entire session to Travel, Meals and Entertainment. One of the strategies I share is how to use the IRS rules to make money on your meals and entertainment by turning your current non-deductible expenses into legal tax deductions. One of the key parts to making this strategy work is protecting your meals and entertainment deductions by keeping proper documentation.

Use this short checklist for all of your meals and entertainment expenses and your deductions will be well protected:

____ Amount of each separate expense

____ Date of expense

____ Location of expense

____ Business purpose of expense

____ Names and business relationship of the people involved

It may seem like quite a bit for each and every meal and entertainment expense, but here are a few ways to make this process very simple:

Get a receipt! The first 3 items - amount, date and location - are usually printed on the receipt. Then simply write the remaining 2 items - business purpose, names and business relationship on the receipt.

I always recommend scanning your receipts so you have an electronic copy. Many receipts tend to fade in just a year so your documentation could disappear! A scanned copy won’t fade and can help reduce the clutter of receipts.

If you don’t get a receipt, then document all of the items listed above (either write them down or type them up) and then attach support for the payment. Here are a few examples:

If you paid by check, attach a copy of the check and your bank statement showing it cleared your bank account.

If you paid by debit or credit card, attach a copy of your bank or credit card statement showing the debit or charge.

If you paid by cash, try your best to get a receipt! Otherwise, make sure your documentation is precise and make sure a very small percentage of your expenses fall into this category of paid by cash and no receipt.

**Important Tip!

Don’t force it! If a meal or entertainment expense doesn’t meet the business purpose requirement because it was a personal expense, then don’t deduct it. If the IRS finds personal expenses being deducted, then all of your other expenses will be heavily scrutinized, putting your legitimate deductions at risk for the slightest reason.

Tom Wheelwright is not only the founder and CEO of Provision, but he is the creative force behind Provision Wealth Strategists. In addition to his management responsibilities, Tom likes to coach clients on wealth, business, and tax strategies. Along with his frequent seminars on these strategies, Tom is an adjunct professor in the Masters of Tax program at Arizona State University. For more information please visit http://www.provisionwealth.com.

The retail sector is where most of the activity related to transactions and deals take place. Competition from European and other nations of the globe and from other via media have forced the retailers to think again. They need practical tips to maintain their market share and simply to float with the tide. It becomes all the more hectic to maintain the accounts reports and the taxes related data and the professional services of a retail accounting are of much help here. To understand the special requirements of retailers the services of an accountant are of immense help. The work related to accounts in retail shops is somewhat different from what is undertaken for the MNCs.

It becomes much difficult to keep track of the accounts in a retail shop because of the sheer number of items involved. Yet nothing is lost because of the presence of a retail accountant from retail accounting, which ensures that your profits are maximized through a number of practical steps. These are improvements in your stock control, purchasing the re-ordering and re-conciliation procedures and a proper advice on the installation of the computerized systems. Both your time and expenses are saved through this process. Since Value Added Tax regime is strictly demanding one form the retailers, only experienced professional having a proper hold on the financial matters need to be contacted. The retail accountant handles most of your VAT planning and administration tasks from a knowledge-based perspective. The accounts professionals help you to achieve your business objectives and it doesn’t matter whether you belong to a high street retailer category, or a small organization.

Surely, you wish to hire the services of an accountant who can deliver the results on time. It is very important for your business to operate in a faultless way so that your organization is at the forefront in the market. Sound advice in this direction can only come from the knowledgeable accountants who are adept in accounts handling tasks. But before you go for one, make sure that the retail accountant you hire works in tandem with you. This means that a two-way channel should operate between the client and him so that clarity is achieved as to what exactly should go into the accounting details. Periodically, you can check the progress of the work handled by you to him which will show where exactly you stand.

For the retailers, a retail accounting software is utilized by the retail accountants. This particular software is especially helpful in maintaining the accounts properly. Through this procedure, the number of products sold and to keep track of the shop’s stock becomes quite easier. Then it becomes very simple to determine the kind of product that helps in the profits of a retail organization. The retail accountant understands fairly well the statistics summarized by the software. In this way, the manual labor to tally the burdensome computations becomes quite easier. Thus proper methods adopted by the accountant save the energy and time of the retail businessman. In turn, this means a perfect selection of the highly demanded products in the market and an increased growth curve.

Alvis Brazma gives advice to business owners about how to manage their business efficiently without any hassles.To know more about Accounting help, accounting outsourcing, Retail accounting, bookkeeping help visit this leading internet source: http://www.impacctusa.com

SOX - An Overview

It is mandatory for all US public companies to adhere to the Sarbanes-Oxley Act (SOX) introduced in the country in July 2002. The primary objective of the Act is to regulate financial practice and corporate governance and restore investor confidence in response to major financial scandals involving Enron, WorldCom and others. But public companies are already grumbling about the costs of abiding with the Act’s requirements.

The Japanese government similarly, promulgated a law in June 2006, known as J-SOX in order to prevent accounting frauds by public companies and to safeguard investor interest. This will be in force for all fiscal years starting from April 1, 2008. Drawn up on the same lines as the US-SOX, companies listed in Japan and operating in other countries as subsidiary companies have to adhere to J-SOX compliance.

Weighty Regulations
The most contentious part of SOX is Section 404, which requires management and the external auditor to report on the adequacy of the company’s internal control over financial reporting (ICFR). This is the most expensive aspect of the legislation for companies to implement, as tremendous effort goes into documenting and testing important financial, manual and automated controls. Additionally, the Sarbanes-Oxley Act states that all business records, including electronic records and electronic messages, must be saved for “not less than five years.”

The penalty for non-compliance is fines, imprisonment or both. The legislation not only affects the financial side of companies but also the IT departments which are responsible for storing a company’s electronic records. Accounting and IT must work hand in hand to achieve the best possible accuracy in the implementation of SOX. Expectedly, the additional compliance costs and the increased paperwork that have come with the legislation have put companies in a tizzy.

Outsourcing - the Key

Both US SOX and J SOX involve documentation of all business activities of a company. It involves defining processes, mapping and identifying risks and controls. Fulfilling this daunting task involves diverting scarce corporate resources. The sensible option in such a scenario is to outsource these mandatory processes in order to ensure compliance in a cost effective manner and to free up resources to focus on other aspects of business.

Outsourcing companies particularly from India have jumped on to the Knowledge Process Outsourcing (KPO) bandwagon with SOX compliance related work garnering a major share in the outsourced processes. While significant cost savings is the key driver to consider India as a preferred outsourcing destination, there is no disputing the fact that companies benefit from the huge English speaking work force with superior financial and technology skills.

Outsourcing companies in India offer back office and internal audit services for SOX compliance - streamlining and automating the complex process to employ best practices to fulfill SOX regulations. In a short while, they become your business partner and not just an offshore vendor. It makes complete business sense to offshore internal compliance related procedures to an experienced team of financial and legal experts who will facilitate the setting up of secure, ongoing procedures and controls to meet your firm’s requirements under the Sarbanes-Oxley Act.

Most offshore companies in accounting and finance offer the following services under SOX:

* End to End Process Mapping (including documentation of process narratives and flow charts)
* Risk Assessment based on a well defined Risk Control Matrix (RCM)
* Process Walkthroughs
* Test of Design & Operating Effectiveness Assessment
* Spread Sheet Control Assessment
* Segregation of Duty (SOD)
* Gap Reporting
* Remediation of Gap

Sustaining Compliance with Automation

Automating the internal audit process ensures the accuracy and consistency of financial procedures. Today an array of technology driven solutions helps automate everything from file transfer to document retrieval. They connect all SOX processes on a single platform making it easy to access records from any location.

Advanced tracking and reporting capability streamlines a company’s SOX requirements and permits continuous monitoring, all of which helps increase confidence within the company and among the auditors. SOX compliance history is always accessible. Emergency fixes are automatically documented and reconciled for easier audit.

Fool-proof Security Practices

The process of taking over the parent company’s bookkeeping, accounting and tax return activities is seamlessly accomplished in a systematic manner to a fully secure and protected environment. The dedicated offshore team synchronizes the client firm’s compliance requirements by setting up robust internal controls and processes from their offshore site at a fraction of the cost. Companies can thus meet the challenges of compliance upfront and take home significant cost savings.

It is generally seen that outsourced back office operations are in good hands due to an unshakable wall of physical, network, data and desktop security around the financial processes.

For further details on how outsourcing can help you with easier SOX compliance, please contact satyen@leosys.in

Ashley Jacob is a content writer and PRO of the team at Udyen Jain & Associates, an India based chartered accountancy firm specialized in offering cost-effective solutions to take care of your SOX compliance needs. Visit http://www.uja.in for more details.

Bookkeeping is a very important part of any business structure. The owner of the business must know where their money is, what fiscal amount of money they had to spend or invest, and whether there money is losing or making money. The traditional bookkeeper would come by once a week or once a month and collect all the invoices and purchase orders that the owner had gathered for the week. Traditional bookkeeper would then enter the numbers into the ledger so that there was a least a semblance of order in accounting. The negative aspect of a traditional bookkeeper was that sometimes the numbers were delayed by up to a week or more. This could cause delays and miscalculations of company funds and could put the company to into a deficit.

A virtual bookkeeper is a person that a company would hire to keep their books with them and not have a physical address that usually costs time and money. A virtual bookkeeper Kate Daly take into receipts, and voices, than statements of the business and have them electronically inputted into a readable report that would be updated daily and could be viewed on command. The virtual bookkeeper would allow the business to have a more up-to-date statement on their financial records and also allow them to be able to see the bottom line at a moments notice. Here the business owner can make crucial decisions on how the money is allocated or spent or how the money is invested for future endeavors. The virtual bookkeeper is off-site and is communicated with electronically through the Internet or via telephone. The virtual bookkeeper is faster, more efficient, and saves time in the long run. The records of a virtual bookkeeper are more secure because they are kept in a separate location out of the eyes of curious employees. The virtual bookkeeper will allow access to your books only to the people that you have trust in and give permission to see. Just a click of a mouse and the owner will be able to see all the financial records of the company and know within 24 hours what fiscal cash flow the company has for use.

Cheryl Criswell created this website to help business owners find a virtual assistant or bookkeeper to do the tedious tasks that demand space and time. To learn more about the virtual assistant and bookkeeper, visit http://www.thetexasva.com

If you are a small business owner you know that it is hard to compete in today’s business e-market and with office space being the cost that it is, it is even harder. You spend your day making sales and trying to bring money in and then you spend an hour or more a night placing the figure into your books. This is a tedious tasks that some people find that it is better to subcontractors work out to other people.

The traditional method of hiring a bookkeeper is having someone come over to your office and have their own space and sit and do your books. Sometimes you pay a nominal fee for the service but the most annoying and costly endeavor using a real bookkeeper is that you have to spend money for the space they are taking up in your office or you have someone that is in your office during the business day that could be a distraction.

By having a virtual bookkeeper you are allowed to have the bookkeeper and still keep the space in her office to yourself. They virtual bookkeeper will allow you to send the receipts and invoices through e-mail, a communications equipment, or other venues that will allow them to adjust and to log your books down for the business day without you having to being involved whatsoever. At any moment you can pull up a display where your books are encase, you need the records for the IRS or you just want to know where your business stands on any given day. Or virtual bookkeeper works only when there is work to do and not just taking up space, your time, and your money.

Cheryl Criswell created this website to help business owners find a virtual assistant or bookkeeper to do the tedious tasks that demand space and time. To learn more about the virtual assistant and bookkeeper, visit http://www.thetexasva.com

For the companies worldwide, tax return season is a hectic one. It is in this hurry that important tax details are overlooked while aiming for the profit curve for their businesses. Often, time is a casualty here, because the timely payment of the taxes becomes almost near to impossible. The burden often increases to unmanageable levels and therefore it is better for them to go for the outsourcing services. These outsourcing services help you to tide over the tax rush season in a proper manner. A variety of activities like work flow management, staff management have to be attended at these companies, and therefore, it becomes very difficult to keep track of other financial activities. With tax return outsourcing, however, you are guaranteed to meet an ever-increasing customer demand and your financial tasks are made much simpler. The financial advisers of most of the companies these days suggest outsourcing from the certified firms, to help the CPA’s.

Since tax calculating norms differ from country to country, accounting firms make it sure that their accounting staff is specially trained according to the module followed in the country. To provide the clients with a quality task, the tax related work is entered in to tax software where the combinations give a satisfactory result. This comes cheap compared to the CPA’s in any company, who charge you a nominal amount. And who doesn’t want to earn profit points while investing on very small scale in the company? Tax return outsourcing is especially beneficial for the organizations because of the lessening of the burden released by the vast potential in the form of manpower. The saved manpower is diverted ton other areas of possible development like tax consultation. The tax return outsourcing increases the efficiency of any organization, as they are properly equipped with the latest techniques. This saves a lot of time compared to what the in-house staff might have dome had the work been entrusted to them.

Tax raids are a norm when they aren’t filed on time. But the certified public accountant makes sure that you are save form the tax hassles in an easy way. The professionals assist you in avoiding them and this happens because of the systems that have been developed over the years. These specially designed softwares help you to mange your business accounts in a logical way because of certain techniques present in them. Tax return outsourcing firms are a sure way to increase the profits of your organization. Mainly, the reason of dipping profits in any organization is the de-focusing, which takes place owing to the immediate, but unavoidable concentration on filing the tax returns. But the tax return outsourcing service hired takes away most of the burden form the CPA’S. These professionals work on a contract based theme and are thorough with facts related to the taxes.

Speed and efficiency are guaranteed with a tax return outsourcing professional. They work strictly according to business ethics and hence, understand the value of your money and time. You are saved of the tax raids with their timely intervention and advice. Moreover, the security systems installed at the outsourcing firms is unparalleled. Firewall systems and a thorough checking of the employees ensure that no data theft takes place. Tax related information is strictly guarded and the data is shared with a client company upon the completion of the task.

Michelle Barkley is a CPA who advises people on tax preparation and tax calculation. She specializes in bookkeeping outsourcing and outsourced accounting. To know more about accounting outsourcing, tax return outsourcing and small business bookkeeping outsourcing to use the services visit http://www.ifrworld.com.

New business owners are business owners who have not had experience with accounting or bookkeeping and are sometimes confused with the definition in the job description of each. Without knowing the difference between an account and the bookkeeper a business owner might be charged more for the services they are actually receiving. By knowing the difference between an accountant and a bookkeeper the business owner can choose the right services that are appropriate for them and their business needs.

A bookkeeper is someone who, by definition, keeps your books. You give them the invoices and the payments and they enter the numbers into a book to give you a viable accounting to wear your company is financially at that moment. It is up to the business owner to give the bookkeeper all the receipts and invoices so that they may keep accurate books. The bookkeeper will keep your books only and not be accountable for IR assessments, financial legal associations, or anything outside the realm of just doing the math and keeping your books straight.

An accountant on the other hand has the same duties as that of the bookkeeper but they also have the duties of making sure that your finances falls within the realm of all tax laws and corporate law. The account has more experience than the bookkeeper and can give you advice on how to invest your money, how to get a better bottom line, and how to bring about a more solidified financial base for your company. An accountant has a four-year bachelor’s degree in their field and has more experience and expertise in just jotting down numbers from your receipts and invoices. The candidate is responsible for any mistakes that they might do under taxes and will reciprocate by either paying the clients or paying the difference in what you would have earned if they had not made a mistake, a bookkeeper does not give you the luxury.

Cheryl Criswell created this website to help business owners find a virtual assistant or bookkeeper to do the tedious tasks that demand space and time. To learn more about the virtual assistant and bookkeeper, visit http://www.thetexasva.com

Both accountants and business people are grappling with the controversial accounting term known as depreciation. When financial statements are prepared the depreciation figure can be confusing. It can be too high at times, or too low, or just not properly done at times.

What is depreciation?

It is the accounting term used to describe the wear and tear of assets over a certain period of time. Depreciation is written-off against the income statement, based on a certain rate, and reduces assets on the balance sheet. Since it affects the bottom line, profits, it should be reasonable and fair. When profits on the disposal of assets are measured, the depreciation rate can affect that profit as well.

To derive maximum benefit from the business assets, the services of experts have to be considered. Depreciation percentages are easy to grasp, but it is with the implementation where businesses can encounter many problems.
Be selective with the accountant that will deal with your assets and taxes.
The accountant or tax consultant, should not only be conversant with the basic bookkeeping entries, but also with the fixed assets register, as well as complex developments in International Financial reporting Standards and changes in tax laws.

Mistakes and neglect with the fixed assets of a business’s, can result in losses running into thousands.

In as much as the services of outsiders are encouraged, there is just no getting away from the fact, that the business owner should become more hands on in the management of the businesses assets.

An expert can help, but he/she is not on your premises on a daily basis.

Since fixed assets, create economic benefits, the management and utilisation of your assets to derive further economic benefits, in these precarious economic times, cannot be overlooked. Also take note of the provisions that propose depreciation on buildings. Land however appreciates, and rarely depreciates.

With the changes in International Financial Reporting Standards, radical changes from these bodies have been proposed. Useful life and economic life, in depreciation, is not necessarily the same thing. We furthermore have to look at prescribed statutory tax rates, which differ vastly from normal depreciation rate, and how that would affect the bottom line in a business.

No transaction for depreciation will pass through your physical books. The depreciation amount will be based on prescribed guidelines to determine the amount. The entry is based on no source document, and is known as a “book entry. What makes depreciation more contentious is the fact that it is a book entry. So even if the books are neatly prepared and balanced, the “depreciation factor”, leaves room for manipulation. Tampering with the depreciation rate/amount can result in either a loss or profit depending on the circumstances.

Even if strict International Financial Reporting Standards (IFRS) guidelines are followed, the carrying values and residual values can be tampered with.

A reasonable estimate could be 25% on machinery, but what if the machine is used for more than four years? Or alternatively, a computer can be used for 1 year whilst a depreciation rate of three years was provided for.

The following points are crucial for depreciation;

· Depreciate on a systematic basis
· Review depreciation methods annually
· Review residual values and useful lives annually.

Apart from IFRS, guidelines, the business should have clarity of the exact amount of years the asset will be used for.

Before calculating depreciation figures, thorough research should be performed on the fixed assets, its true values, residual values, useful life and economic life. Since these concepts are vital when final calculations are performed.

A more detailed version of this article is now available in e-book form, on our website. Find valuable information on how to use fixed assets in proper tax planning. Go to our website for YOUR Depreciation e-book

Sean Goss
website: http://www.sgafc.co.za

All successful business owners understand the importance of a proper accounting system; therefore, they employ the most effective accounting system in their organization. It is quite true that in order to maintain an effective accounting system, a great deal of time, endeavor and wherewithal is needed, as accounting incorporates various day to day tasks and transactions. Every business transaction and financial record keeping task must go well, as any problem or mismanagement in these tasks can affect the growth pace of the business. Since every business proceeds with limited human and financial resources, any kind of extra work can affect performance and budget of that business. Accounting is one of those tasks that get affected by the burden of extra work very easily. In such situation the business owner needs to find out a solution that may manage every accounting task without affecting the budget of his or her business organization. However, there are many ways to tackle such situation but as far as efficiency and cost effectiveness is concerned, every business owner prefers to outsource his or her accounting task. In fact, accounting outsourcing is the perfect solution for every industry type, as it can solve all accounting hassle at ease and can provide the client’s business with the most efficient accounting system.

This can also help a business house in keeping pace with the ever-increasing burden of accounting tasks. Moreover, it can also enable a business owner to get maximum impact from limited resources of his or her business. Since accounting tasks are essential for every business organization, getting a suitable solution for managing these tasks can enable a business owner to focus on his or her keyv business functions. This provides the client’s business with personalized and modified accounting solutions that help that business in accomplishing every essential task with low operational cost. In fact, firms that offer accounting services understand every requirement of their client’s industry and provide the solution accordingly.

These accounting outsourcing service providers offer accounting solutions for top and middle level accounting section. Since an outsider firm cannot perform any primary or day to day accounting function of any business, it is always better to perform that task with your in house accounting professionals. Certainly, such service providers possess specialization in keeping a record of your financial transaction therefore with them you can be rest assured about preciseness of your accounting data. They can provide accounting solutions to meet your business requirements and can provide you with every necessary support and adice.

If you own a business and are not getting the desired output from your accounting system, then you can take the help of accounting outsourcing, as it will help you in getting maximum benefits from your employed resources. In fact, with these services you will never need to worry about preciseness of your accounting statements. These services are therefore, a big support for businesses as they enable businesses to perform financial tasks with more efficiency and accuracy. In fact, these services can set a business owner free from all accounting hassles, so that he or she may better concentrate on his or her core business functions.

Michelle Barkley is a CPA who advises people on tax preparation and tax calculation.She specializes in bookkeeping outsourcing,Tax return preparation,back office outsourcing and Outsourced Accounting.To know more about Accounting outsourcing services, Accounting outsourcing and to use the services visit http://www.ifrworld.com.