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Archives for Accounting

You Used to Write in Them, Now They are Important to Your Business

Margins, that is.  Sure, they are the white space on a printed page around the text. But more importantly, they are the best way to measure profitability in your company.

You really need to be aware of your margins.  It represents the percentage of sales you’ve turned into profit, or, put more simply, how many pennies you made on each dollar of sales.

Keep in mind there are several types of margins:

  • Gross profit
  • Operating profit
  • Tax profit
  • Net profit

All of these are reflected on a company’s income statement.

Gross margin is what’s left after subtracting direct costs of the product or service from the sales revenue.

Operating profit or margin is what’s left after subtracting operating costs from gross margin.

Then pre-tax margin results when debt costs and unusual charges are deducted from operating profit.

Deducting taxes from that number results in the net profit margin.

It’s part of a larger process, but an important statistic (or set of statistics) to track. Without profitability, your company runs in the red.

Make sure those white spaces are wide!

For more on how to manage your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*photos courtesy of Unsplash: Frank Busch, photographer) and Paul Maynard

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“I’m not an accountant, but I play one in my company!” Or how to choose the right accounting software for your business.

Someone has to keep track of the “numbers” at your company and it looks like it is you!

Where does one start when it comes to choosing and then implementing an accounting and bookkeeping software package? With so many options to choose from, what attributes should I consider? Here are a few things to consider when choosing a software package:

  • Features
  • Usability
  • Cost

Features.  What do you need it to do? Is this about receivables and payables? What kind of reports should it generate? Should it track inventory, payroll and project management?

Usability.  Can it be accessed from anywhere (cloud based) or is it a desktop-only package? How many users can access it at one time? Is there a mobile app version of it?

And cost.  Can you only afford a low-cost basic package, or can you ante up for something deep with features?

What are the advantages to using an accounting software package?

  • Saving time.
  • Being more accurate.
  • Putting all financial tasks in one place.
  • Reducing costs (see time savings above).

So, what’s available and how much should I be prepared to spend? Here’s a list of the most popular packages out there (in no particular ranked order):

As with any service, product or offering, there is no one-size fits all: check out demos, read up and consider a trial before buying.

Do you do your own accounting internally using a third-party software package?  Are you up to managing this process efficiently?  If not, you should consider outsourcing your accounting needs to a third-party provider.  TFO Solutions is just such a company.

For more on how to manage your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

 

*photos courtesy of Unsplash (Kelly Sikkema and Sigmund Quusek, photographers)

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“We’re bonafide…”

Actually certified.  Quickbooks Certified, to be specific.

What does that mean? With Quickbooks becoming pretty much the standard accounting software for small- and medium-sized businesses, it pays to be trained in the methods and techniques of how to run and manage the software package.

Quickbooks really took accounting to the masses.  It is a software package (either as an application or Cloud based) that allows entrepreneurs and business owners become literate in accounting.  It helps them understand the importance of accounting in their day-to-day operations and ensures a level of expertise and compliance.

By being certified by Quickbooks (Intuit Corporation), it allows us to take the rudimentary financial information that our Quickbooks-using clients have collected and turn that into information that a business owner can use strategically.  Quickbooks collects and performs the payroll, payment and basic ledger functions that used to be done by hand or by older, more complex accounting methods, tools and software packages.

Being Quickbooks Certified means we can help make that data useful to you and demystify it for you to help you grow your business.

In other words, we speak small- and medium-sized business financials.  And we are certified in it.

Do you do your own accounting internally using Quickbooks?  Are you up to managing this process efficiently?  If not, you should consider outsourcing your accounting needs to a third-party provider.  TFO Solutions is just such a company.

For more on how to manage your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

 

*photos courtesy of Unsplash

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Reconciliation is the Start of the Healing Process Between You and Your Money

Want to know where your money has been, where it is going and what it’s been up to? It’s time to reconcile with it.

Or at least your bank statement.

All kidding aside, reconciling your bank statement is critical to your business. By definition, reconciling your bank statement means you are matching your business and banking activities with that of your bank account. Reconciling your bank statement ensures that:

  • Payments have been processed
  • Cash collections have been deposited
  • Fees charged have been accounted for.
  • Ensures that the bank statement matches internal records.

So, why reconcile?

  • It is a “mini-audit” of sorts in that it shows where cash is going—or not—ensuring security of the account.
  • Setting up an opportunity to create a financial strategy—you have a roadmap of cash flows in and out.
  • Uncovers errors such as unrecorded transactions or transpositions of numbers.
  • Doing it monthly keeps your company steering in a positive directions as you know your bank balances and internal books are correct and match one another.

Do you reconcile your accounts?  Are you up to managing this process?  If not, you should consider outsourcing your accounting needs to a third-party provider.  TFO Solutions is just such a company.

For more on how to manage your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*photos courtesy of Unsplash

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Understanding HR Management

“Our people are our product.”

“Without our people, we are just another business.”

“Our people are our most important asset.”

If you’ve ever uttered any of these phrases, hopefully you really meant it.  The workers at any business really are critical to that business’ success.  And to really ensure that success, those workers and their needs must be managed,

Just like the product or service your company produces or offer, your human resource needs to be managed and watched over.  Productivity, efficiency and retention are at stake.

What comprises an effective human resources (HR) management program?

  • Compliance with federal and state employment laws.
  • Recruiting, hiring and onboarding.
  • Working with managers.
  • Developing talent strategically.
  • Creating, maintaining and enforcing policies.
  • Coordinating with payroll.

Do you have these systems in place?  Are you up to managing these processes?  If not, you should consider outsourcing your HR needs to a third-party provider.  TFO Solutions is just such a company.

For more on how to manage your human resource, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*photos courtesy of Unsplash

 

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Rollin’, Rollin’ Rollin’…Payrollin’

Payroll.  If you’re on one, great.  You’re on the receiving end of pay.

But if you are responsible for payroll, you are the one who gets to make sure – or actually does—dole out the bucks to those you employ.

Seems simple enough. Yet, like most activities in business beyond your core business, it might not be in your skill set to deal with all of the things associated with paying your employees.

So what exactly is payroll? It’s really a process, usually handled by the human resources folks in a company in concert with accounting or finance departments.  And it involves:

  • Having employees fill out W-4 forms.
  • Finding or assigning Employee Identification Numbers.
  • Setting up a payroll schedule.
  • Calculating and withholding income taxes.
  • Paying payroll taxes.
  • Calculating and including deductions and reimbursements.
  • Filing tax forms.
  • Issuing W-2s to employees (or 1099 forms to contractors).
  • Paying your employees and contractors.

Contracting with an outside company (like TFO Solutions) can make life far easier by streamlining the process—you deliver the hours to the payroll company and the do all of the paperwork and heavy lifting and issue you the checks.  You stay informed by them through reports and updates.

For more on how to manage and distribute and account for your payroll, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their finances from the back office to the boardroom.

*photos courtesy of Unsplash

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