All posts by Madhu Jain

5 Tips to Determine How Much Money to Borrow

Bookkeeping Service, Financial Tips

An individual should learn the art of managing finances for himself, family, medical exigencies, emergencies or business endeavor. There is always need for more and more; unless properly evaluated and the need for money assessed and comprehended, the moot meaning for ‘savings’ can go for a toss! The financial pundits keep saying understand your palate, assess your dreams and then correlate and fix the issue! It simply means that one needs to consider more than twice the optimum profits that any endeavor shall bring, and should accordingly take calculated risks for reaching the zenith of success.

1. When Does One Think Of Borrowing?

On a personal front, a person needs to have a comprehensive knowhow of what is his capacity or competency to repay a loan furnished. Thereby, he should understand the range of expenses that needs to be covered, before walking to a financial entity or a bank for a loan.

When the sales are low, and there is a lack of finances, a business loan can indeed turn out to be a lifesaver. There is a verisimilitude with personal loans or even car loan or a home loan! Understanding one’s goals, setting them upright with the vision in mind are prerequisites, before opting for submitting or approaching for finances.

When rightly thought, the amount that a person borrows as business loan, can incidentally help the person cover up all costs and return proceeds profitably. In such a scenario, the cost of bearing the loan is not only adjusted, there is also ample scope for personal profitability and business growth. There are five simple questions that any individual or business entity – proprietor or business partner should bear in mind and answer judiciously, in order to understand how much funds should a person borrow!

2. Avenues for Spending the Borrowed Funds

The key question that needs to be answered first by a borrower is across what avenues, or genres or for what purposes would an individual expend the borrowed sum. A generalized answer like propelling the business to better growth making unit and greater heights appears too clichéd! Being specific is important. The borrower needs to have a pragmatic vision; he needs to think of a business venture being ineptly cash-positive, obsessed towards healthy growth, with the margin for the same. The borrower need to satisfy himself with questions like where exactly will the borrowed funds be put?

There may be thoughts like rebuilding the manufacturing or production unit of the venture, or opening a new value-add service, or pondering an expansion of the units to ameliorate sales and proceeds. Again, the funds may be used to purchase larger quantities of raw materials or purchase new machinery or human resources.

Thus, objectively, from the sales angle, the reasons for putting in funds may be enhancing the sales portfolio with better ranges of products. Further, Inventory may be created, sales team may be hired for development or expansion.

The direction of expense of the borrowed funds should be clear, and the business person should know to value the deal. The team should envision the extent of profits that can be made to better the portfolio and achieve tangible, realizable goals.

3. Research Ample Borrowing Options

The idea is to use the money to power short term visions and being about stupendous beneficial results in longer terms. On a personal front, home or personal loans are primarily based on consumption. However, there should be proper avenues to make for the loss rendered to close the loan. It may comprise putting a house or property for lease or rent, or making money from other sources to quench the losses.

There are wide varieties of loans and limitations on the money borrowed. There are terms and conditions on how the money borrowed can be repaid. It is important to match the desired loan amount, analyze the financial plan and correlate the same with repayment terms. There may be myriad types of loan options that would let a person borrow more funds than other for himself, or business endeavor against a mortgage or mere unsecured. It is important to validate and analyze the terms and just not jump into one such option, starry-eyed. Remember that if a person needs $200, it is far better to seek for a loan of $150 or $180. The borrower should try getting the remaining from own resources, friends or families, rather than taking out $500 as loan and then inviting a nightmare

4. Do You Know Your Repayment Limits?

The fundamental rule that suffices for life on this planet is ‘quid pro quo’! Everything has a cost, and with loans, the costs incurred seem to haunt a borrower in his sleep! A person should understand how much funds are required to set the work in progress, and thereby get profits, or reuse the money to fund the business endeavor. It is important to know the extent of funds a borrower is eligible or qualified to get.

If a person can get $200K loan easily, yet if the requirement is of $90K, it shall be a pragmatically correct decision to take only $90K and not more! A loan doesn’t necessarily generate income; it’s a liability. More the amount taken, greater is the EMI rendered

5. Validate The Lending Source

People need to be fully aware of the trustworthiness of the lender, the detailed terms and conditions, any hidden costs involved, mode of repayment, tenure and condition for the same. The nature of collaterals, cash flows or business credits or overdrafts may vary for person-to-person, and depending on the nature of endeavors. There are various sources that give out loans easily, without any hassle; however, later on, if the terms of policies are unclear, it may create a nightmare for the borrower.

6. Always Take A Step Back, Think And Decide

There is no point doing some hara-kiri and ending up with getting an overvalued loan from the wrong source, and then paying out more than necessary. Understanding the personal needs, requirements or the requisites of the business, doing proper evaluations and matching the goals and standards are required before opting for a loan. If the premise for borrowing funds is unclear, there may be more wrongs done than right, and eventually, there is no turning back from the unnecessary pressures!

Worth of Accounting Services for Small Business

Bookkeeping and Accounting Services,

Small & mid-sized business usually faces troubles in setting up their non-core business such as accounts, HR & payroll etc. All kind of businesses have to manage their marketing, copy writing, payroll and accounting services. Non-core activities are vital in a business but small and mid-sized business may not be able to focus these parts. Accounting Service for small business is now accessible through outsourcing firms endow with various services such as:

  • General Bookkeeping
  • Accounting Service
  • Financial Accounting
  • Accounting Clean Up
  • Taxation

Accounting Services for Small Business through outsourcing firms helps you in saving cost and also cut downs workload. Diverse group of small size businesses outsource account services to alleviate from a large responsibility to handle accounts division of the company. Here some benefits are mentioned that generally facilitates small business to outsource accounting and bookkeeping:

  • Major focus on core business
  • Low cost
  • Get relaxation time
  • Access of expert advice
  • World class service through highly experienced professionals

Hence, Accounting Service for Small Business is benefited because of having all aspects without paying extra cost and efforts. Experts of outsourcing firms let businessman to accomplish critical requirements of business for growth and development. You just need to find out best accounting outsourcing service for better, faster and cost effective performance.

Transparency in accounts develops good reputation among your clients, stakeholders and in market. Therefore, getting these services for mid or small sized business is the smart business strategy to approach quality services and results.

Worth of Bookkeeping Outsourcing Service for business

Bookkeeping and Accounting Services,

Trend of outsourcing accounting services is escalating being an indispensable part of a business. Accounting and bookkeeping services are considered as a non-core business process. Hence most of the businessmen find out outsourcing services to avoid extra expanse on setting up a department. Today bookkeeping outsourcing service also has become major trend to keep records of financial transactions up to date. It is the major part of accounting because of its worth for standard performance analysis that directly links to the taxation matters.

Bookkeepers or accounting technician of Bookkeeping Outsourcing Services are highly qualified to prepare trial balance and ledgers. These trial balance and ledgers helps in depicting financial statements such as balance sheet, income statement, cash flow statement and retained gains. A number of things are liable for having bookkeeping and accounting service that can be understood better through listed below points:

  • Trustworthy Bookkeeping
  • Years of experience in Bookkeeping
  • Up to date and accurate virtual bookkeeping services
  • Access of highly experienced and multiple QuickBooks specialists
  • Firm security and private policy
  • Economical approach for bookkeeping and accounting services

Accounting outsourcing firms delivers Bookkeeping Outsourcing Service that covers recording of daily financial transactions including sales, purchase, receipts and payments etc. It has immense worth in a business to achieve higher level, hence it is known as the most vital part of accounting process of a company or business. Outsourcing firms allows you to have highest quality of beekeeping service with safe and security by recording in the correct day book, customer ledger, supplier’s ledger and general ledger.

Top Bookkeeping Tips For Small Businesses In Phoenix

Bookkeeping Service

As per the National Federation of Independent Business report published in 2014, Phoenix in Arizona ranked fifth best city in the U.S. for operating a small business. The region’s rebounding economy coupled with favorable climate and entrepreneurial culture has paved way for small business owners to thrive and grow their businesses. A number of small businesses in manufacturing and healthcare businesses have emerged in business-friendly Phoenix over the last few years, while the region records new entrants each year.

top-bookkeeping-tips-for-small-business-phoenix

Top Bookkeeping Tips For Small Business.

Starting a business is herculean as the very idea of bookkeeping is fearsome for owners of small businesses who are new to the task. Moreover, recruiting personnel or outsourcing the same is often not viable for small businesses, at a very early stage. But, once put into practice, bookkeeping turns out to be a simple task that involves penning down business income and expenditure right from the beginning and maintaining accuracy. In the beginning, a business could choose to either follow ‘Single-entry’ bookkeeping or ‘double-entry book-keeping’. The single entry system is appropriate for budding and very micro businesses, which could eventually shift to double-entry bookkeeping as their business grows.

If a business owner decides to take the onus of bookkeeping, then he should first begin with maintaining cash purchase receipts and invoices relating to business expenditure. Some of which include bank and credit card statements, utility bills, cash or cheques, payroll records, etc. One can either keep these records on paper or computer spreadsheets; the most efficient and effective way is to invest in basic bookkeeping software. The electronic method of bookkeeping has done away with the age-old process of recording transactions in journal first and then posting it to respective accounts in the general ledger. Under electronic format, the purchase invoice will automatically update the relevant general ledger accounts such as Purchases, Accounts Payable, Inventory, etc. Such sophisticated software eliminates accounting errors to a large extent. However, a business has to keep an eye on some of the basic rules of bookkeeping.

1, A bookkeeping process starts with source documents, which should first be sorted out for all transactions, operations as well as other events related to the business. For example, supplier’s invoice is considered as a source document for supplies purchased, which is accompanied by the company’s purchase order and acknowledgement. As per the Federal Law, a business in Pheonix should retain certain documents for a period up to 6 years, while Audit report, cash reports and a list of other specified documents are required to be stored indefinitely.

2, Once the source documents are in place, a business should go ahead with keeping records of transactions.

– The purchase of supplies on credit

– The sale of merchandise on cash.

– Rent paid for office space

– Purchase of equipment for office

– Borrowing money from the bank

The accounting software will record such transactions under a number of accounts such as Accounts Receivable, Cash, Loans Payable, Sales, Purchases, etc.

3. Recording of transactions – It is an ongoing process, and so a business owner should commit a specified time each week towards managing finances and updating software with weekly new invoices. On an average, it will take in between 30-90 minutes per week for a small business entrepreneur to accomplish the task.

4. Separate Out Accounts Receivable From Borrowed Funds – During the initial stages, a business owner often needs startup capital and financial assistance to undertake business-related activities. Such requirements are either met through loans from banks or borrowed funds from various sources. In such cases, it is important for a business owner to carefully draw a line between receivables and income from borrowed funds.


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5. Eye On Receivables – A bulky and large receivables column is an encouraging sign for a business, but when it starts piling up then the perception could change. Receivables do not mean real money until clients clear their outstanding balances.
As per US GAAP accounting standards, Accrual method applies to Receivables, which means that they are recorded when earned and not necessarily on receipt of cash. Hence, in order to prevent receivables from ballooning to an abnormal level, a business owner should aim at regularizing the payments. New orders should be delivered to existing clients only after they clear their previous outstanding balances. A publication, Arizona Small Business Resource pointed that the U.S. Small Business Administration (SBA) has clearly set a guideline of ‘Aging’ of accounts receivables in its business loan program.

6. Reconciliation Of Bank Statements – Even if small businesses review their cash flow statement and bank statement separately, they should diligently double-check and reconcile the bank statements on a monthly basis. The practice will help business owners identify discrepancies if any and keep them more aware of bank and cash-flow situation.

 

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7. Separate Tax Account – Each receivable carries a tax element for a business owner. Hence, creating a separate tax account and transferring the tax paid on each receivable to the said account will make filing taxes hassle free. A disciplined approach in this matter would relieve an owner from end-moment tax rush. Over the last few years, Arizona Legislature has tried to cut business taxes, which increases probability for Phoenix business owners that any surplus under this head could be invested back into the business.

8. Cash Flow Statement Under Check – The cash flow for most of the small businesses is volatile, which means that it demands special attention from the business owners. If bookkeeping software is in place, then it will be easy for a business to keep a tab on cash flow statement at all times. A watchful eye on the cash flow statement would help a business rectify cash deficit situations through various financing means. Additionally, monitoring cash flow statement will ensure that debts are properly covered at all times, and there is no lapse midway.

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9. Tracking Daily/Weekly Expenses – During initial stages, an owner should track everyday expenses that are incurred in the conduct of a business. Detailing expenses on a daily basis will allow a business owner to get a clearer picture about the direction of finances and help prepare a budget estimate for the upcoming weeks. Also, an owner would have full control on business expenses, which would give him an opportunity to tape any superfluous expenses.

10. Keeping Up Business Income -The main goal of a small business is to keep it running and eventually help it grow into a bigger entity. But, crunching numbers and predicting how much it will take to keep the concern running is a complicated task. Essentially, the process is ongoing and largely depends on an efficient system of maintaining expenses and achieving a sustainable income each month.
income, business,

Keeping Up Business Income

Since business income is one head, which is easy to calculate, hence a small business owner should always keep an achievable yet strict target on earning the same. One could not miss the point that it is business income that motivates a business to scale up to the new levels, where bookkeeping functions as a ladder.

Short Leash Hot Dogs is a handy example how owners Brad and Kat Moore took a big leap in their business by moving from a food truck to a permanent location in Pheonix. Also, the Small Business Survey conducted by Chase Bank and the Greater Phoenix Chamber of Commerce in June, 2013 outlined that 72 percent of Phoenix small business owners had the confidence about the growth of their business’s revenue.

keeping-up-business-income

Accounting service outsourcing the finest way to nurture your business growth

Accounting Outsourcing Services

Diverting from an earlier trend several business organizations have no hesitation in opting for accounting service outsourcing. With such service it becomes possible for these organizations to get a cost effective method of improving their ongoing business process. However, if you want same exceptional result from this ongoing process, you need to plan meticulously. Below mentioned are some relevant point which you need to consider before making your mind to adapt these services.

accounting-service-out-soutsourcing-

Accounting service outsourcing the finest way to nurture your business growth .
* You should make up your mind before availing bookkeeping services. You need to analyze each and every aspect. Comparing the current cost with the upcoming one is a better idea of analyzing things. If someone is present in your company looking after the bookkeeping task then find out which benefits you may get after acquiring Accounting service outsourcing. seo company australia . One thing you should notice is that it saves a lot of money which the companies spend as overhead cost like infrastructure building, software and hardware implementation, rent cost and many more.

* Companies should try to make a list of benefits which they would get after availing these incredible services.

* Finally after assuring yourself about the new services you should look for some top notch company which understand your requirements and later provide you dedicated service. Analyze at least four to five companies before finally selecting the one you need.

* Now advance Accounting service outsourcing provide any related services which will help you improve the overall reputation of the firm. It is believed that such firms dealing with diverse services are capable of handling complex task more easily.

* You should try working with outsourcing companies which have market reputation and sufficient years of experience in the relevant field. Make sure that the company takes relevant security measures in keeping your organizations account information safe and secure that is away from any potential threat.

Having a keen desire to achieve desired goals for their business, owners work hard but one thing they don’t understand is that, adapting new methods to ease business process is the smarter way to get high return on investment.