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New Year Accounting Resolution for your Business

By Dipali Nishad for SKB Accounting

 

Each year, people all over the world have a new resolution to improve their mental health, physical health and career goals among many others. We are here to remind you of some business resolutions that you might not want to miss out on in 2022. 

  1. Reform Business & Marketing Plans: No business can stand out in the corporate world without an effective business and marketing plan. You must have stepped in your industry with one. However, with the passing time, it requires an update as your finances, business goals, competitors and range of a team change. If you wish to expand your business or start a new project, you may need to take a business loan. Revisiting your financial plan according to your changing requirements becomes crucial here.

    With the technology driven world, not riding on the latest marketing trends can cost a decline in your profits. You can analyse the success of the marketing plans you used last year and curate the best one for the new year. Brainstorming and designing marketing strategies with your team will give you an edge over competitors.
    Here are some marketing strategies that you shouldn’t miss out on.

  2. Take Professional’s Tax Planning Advice: Tax is complicated, that’s why a tax professional’s advice is essential. Tax planning is a legal process where a CPA or some other tax professional expert arranges and looks at all of your business expenses, revenues and activities to inform you of all the tax breaks or waivers available to you.  Tax advice is considerably a saving to your business. They help in restructuring your company finances to make them more tax-friendly.

  3. Clear unpaid Customer Invoices: Unpaid invoices directly affect your cash flow. If an invoice is unpaid for a very long time, don’t hesitate to give a gentle reminder. However, always verify that the invoice had clear details like due date, amount of invoice, customer’s name, course of action if the deadlines are missed, invoice is mailed/sent at correct address, etc.
  4. Prioritize Company Culture: The Alternative Board (TAB) stated in its survey of business owners that 86% of respondents say they believe company culture directly impacts productivity. As a small business owner, it’s important to understand and maintain good relations with employees. Your company culture influences individuals mindset, engagement and internal coherence in the actions of employees having diverse backgrounds.

    “Customers will never love a company until the employees love it first.” – Simon Sinek

    You can conduct surveys on an anonymous basis to get their take on the company culture. Then accordingly analyze and curate a culture that portrays your business value while also prioritizing the requirements of employees.

  5. Outsource Accounting Functions: In the last few years, did you ever feel that your employees or you are not able to make time for complex operations of the business due to in-house accounting?

    Yes, then outsourcing is your call.

    Outsourcing the accounting department can bring massive changes in your efficiency and performance because of the following reason:

  • Eliminates Cost & Time of Hiring & Training an in house accounting department
  • Get Expertise of Accountants and Professionals from different industries
  • Accounting firms use latest automation technologies which provides accuracy
  • Handles and gives best advices for your accounting department, so that you can focus on your primary operations

Schedule a meeting with us here to keep your business ahead of the curve this year! 

 

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Writing in books

Tips for effective debt management for small business owners

By Dipali Nishad for SKB Accounting


Do you find it difficult to manage business debts? 

Not to fear, a recent survey by Gallup states, 49% of small business owners find it difficult to manage their current debt

“If you really want to get out of debt, it’s easiest if you put some sort of plan or strategy behind it. Just saying you don’t want debt is one thing, but actually having an approach to doing it will get you there.” says Tim Steffen, Senior Consultant, PIMCO.

What is Debt Management?
Debt Management is controlling and reducing debts through financial planning and budgeting. It aims to reduce, reorganize current debts and slowly eliminate them. Business owners can create a debt management plan or take professional help like trusted advisors and credit counseling to make one. 

Why is it important?
The business environment is uncertain and dynamic. In the post-pandemic market, a pipeline of funds is significant for survival and growth. Cash is required for every operation such as recruitment, product launch, acquisition of assets, expansion, etc. Small businesses usually take liabilities to infuse new funds. Thus, debt becomes a natural part of running a business, which only needs to be planned well. However, excess debts are also harmful to any business. 

Here are the 5 effective Debt Management Strategies for your business:

  1. Rework Business Budget: The foremost step to manage your debts is being aware of the business’s current financial position. Then precisely study the predetermined financial goals and the current budget of the business. Based on that, redesign the budget.
    Small business loans should be the way to go as a source of capital while developing the budget. Bifurcate your expenditure as primary and secondary and work on reducing secondary by either eliminating or finding alternatives to fund those expenditures.
    This will help you analyze what debt will pose a threat to your business so you can prioritize your payments accordingly.
  2. Improve Cash Flow: If your small business is making regular profits, and you still can’t manage to get in a stable position concerning your debt, the reason could be poor cash flow management. The owners can enhance their cash flow by following these strategies:
  • Measure the actual financial position with the predetermined budgets. Identify the gaps and focus on them to attain the required business cash flow. 
  • Improve the management of payables and receivables by ensuring timely invoicing. Install automated payment reminders and accounting software for convenient transactions. It boosts the cash collection procedure. If your business is unable to pay all the current liabilities, ask suppliers and creditors to extend payment terms. 
  • Manufacturing, Wholesale or Retail businesses should neither carry excessive inventory nor a slow-moving inventory as it consumes most of the cash flow. 
  • Keep an eye on expenses that can be cut and find savings that can be temporarily stopped to relocate this cash in debt payment. 
  1. Negotiate with suppliers: Keep an eye on your accounts payable. You can always negotiate with suppliers on different terms like early payment discounts or length of payment period. You can cut costs here through negotiation and use these funds in other areas.This way you maintain cost-effectiveness and get the highest returns out of your funds.
  2. Refinance Debt: Debt refinancing means replacing an existing debt with another debt with more favorable terms and/or conditions. It is done to take advantage of better interest rate terms of new debt. In addition, owners refinance debts to reduce the monthly repayment and switch from a variable-rate debt to a fixed-rate or vice versa. For instance, ABC Ltd settles its current loan by taking a new loan with less interest rate than the earlier one.
  3. Take help of a Debt Management Professional: Seek professional advice about the different ways in which you can pay off your debt. Leverage their experience towards reducing your debt.
    As a small business owner, you can always take the help of a Certified Public Accountant (CPA) or a legal firm to get a reliable debt management plan.

 

Need a Debt Management Plan?
Indeed, debt management can be tricky at times, especially for small businesses. Don’t fret out, SkB Accounting is here to cover you. We’ll keep track of your debts and accounts to secure your business from any financial crisis. Hop on the board and let us take care of your long-term goals considering your current situation. So that you can primarily focus on your business goals. 

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STEPS TO PROTECT YOUR SMALL BUSINESS FROM FRAUDS

By Satrajeet Mukherjee for SKB Accounting

All businesses are vulnerable to fraud. However, Cyber security often gets overlooked in the case of smaller operations which makes them more susceptible to cyberattacks. While proactive behavior is beneficial and essential, it’s not enough to keep fraudsters at bay.

According to PwC’s Global Economic Crime and Fraud Survey 2020, 6 was the average number of frauds per company. The total cost of these frauds was US $42 billion with 13% of companies that had suffered a loss to fraud saying it amounted to US $50 million-plus.

Some common methods of fraud involving small businesses are Billing schemes, Payroll scams, Cash larceny, Check tampering, Inventory theft, Financial Statement Fraud, etc.
Here are some measures to safeguard your business from frauds:

  • Update your Security systems and IT infrastructure: Investing in an Identity theft protection system can be beneficial if your business accepts online payments. Important data of the company will be encrypted and protected from hackers. Backing up critical data on secured servers will also help protect the same.
    Select an effective Fraud Management System for your organization. It can do real-time screening of activities across multiple accounts to identify and prevent fraud.
  • Educate your staff: Conduct regular training sessions on prevention measures that should be taken. Also, inform them about common security threats and how they can be avoided. Make them aware of phishing emails which are the most common way hackers enter company databases.
    Ask employees to change their passwords every 60-90 days and keep hard to decipher passwords.
  • Purchase Insurance: Insurance is crucial in case a fraudulent attack occurs. Consider Identity theft insurance in case of a malware or spyware attack. This will make it easier to recover from the losses in the event of an attack. You might even get reimbursements depending upon your policy. Also, look at Insurance policy options that protect you specifically from financial fraud.
  • Outsource Accounting and bookkeeping: Outsourcing your accounting and bookkeeping functions reduces the chances of fraudulent activities taking place in your business. When you avail virtual accounting & bookkeeping services, you get experienced professionals. Owing to their experience, they can identify fraudulent activities which may be deeply hidden in your records. This can also be helpful when there is a lack of internal controls which is the leading cause of hampering accounts and records.
  • Employee Background checks: While expanding your workforce, don’t entirely rely on referrals and experience. Conduct strict, thorough background checks focusing on tiny details.
    Pay special attention to the hiring of employees who will be handling cash, records, or confidential data.
  • Regular and Surprise Auditing: Auditing in regular intervals will help in avoiding fraudulent activities as well as help in detecting them. Any unusual activity can be identified and acted upon. Surprise audits can keep a check on the same. This will reduce chances of records and accounts getting hampered.

Keep in mind these steps to avoid fraudulent activities in your company. Small businesses are very much vulnerable and these fraudsters prefer to exploit them since they are easy to take advantage of. Online accounting apps & consultations from CPAs (Certified Public Accountants) are the best to check these frauds since they come with high-level protection.
Thus, don’t waste more time before opting for SKB accounting which will provide you with all the necessities for your business with a professional level of security. Sign up now!

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3 reasons why small business owners must take expert advice to become successful

Written by- Nivedita Verma for SKB Accounting

Do you have a brilliant money-making business idea but lack the knowledge on how to move forward with it?

Or do you have a plan but lack market knowledge?

It is high time you may want to book a business expert to get your business running on track.

While you may have a great business idea and a plan for making the business of your dreams come true, you may not have the expert knowledge needed to study and analyze the market. This is where business experts come in.

Consulting an expert to take advice will help you in countless ways, but the core advantages that you will get are as follows:

 

1. Analytical advice and latest tips

Business metrics are quantifiable data that are used to track and analyze all the business processes of a business. These business metrics may just seem like numbers to you, but they play a significant role in determining the success of your business, and that’s why understanding them holds extreme importance as you may not be an expert on how to analyze data. You must consider consulting a business expert as they are trained specially to draw meaningful conclusions from a large quantity of data and they will fill you in with actionable advice that will help you to achieve your business goals.

Getting your business metrics like cost per acquisition, overhead costs, monthly profit/loss, variable cost percentage, productivity ratios, etc., by an expert will give you insights on how to lower your expenses and increase your profits.

 

2. Knowledge of how to penetrate the market

Your small business idea may be the best out there, but you won’t reach anywhere with a good idea if you lack market knowledge. Business advisors are the way to go if you need a deep understanding of the market you are trying to penetrate. Gaining knowledge about your market will allow you to know your customers and trends better.
Advisors are trained individuals and have already scrutinized the market you are trying to enter and its risks. You can benefit from their knowledge and expertise and apply it to your business to establish a loyal client base for yourself as early as possible.

 

3. Risk awareness and prevention

There are a lot of business risks that you must have calculated already if you are setting up a business, but there can be many hidden risks that you might be unaware of. As business expert advisors are people who know what kind of risks you may face and how to avoid them most conveniently, they will make you understand the unforeseen risks, so you are better prepared when they arrive.

For example, if you are running an online business selling clothes, you might have considered the risk of getting the clothes damaged in storage but you wouldn’t have thought what would you do if your internet connection went down for 4 days straight and you lose contact to all your customers and pending orders.

A business mentor will make you aware of all the hidden risks that may occur.

You can avoid losing a lot of your research time by taking advice from an expert and accelerating the growth of your business. Why take the slow road without anybody’s help when you can speed up your success journey by learning from an expert?

Consult a business expert for your field of business today and enjoy the long-term results.

We at SKB Accounting are Quickbooks Pro Certified accountants with 25+ years of experience. We provide expert services in outsourced Accounting, Bookkeeping, Payroll and Virtual Bookkeeping. It is time for you to join hands with accounting experts and take your business to full potential.

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The Hidden Costs Small Businesses Have Got To Deal With

The Hidden Costs Small Businesses Have Got To Deal With

Dealing with costs is part and parcel of running a business. However, businesses should know that not all costs are visible, meaning that there are a number of small costs that might appear to be harmless on paper but affect the prospects of the business negatively, over the course of time.

Here is an account of such hidden business costs:

Permits and Licenses

When they say that governments try their best to cut the throats of their citizens, you might be tempted to believe that the statement is a bit too harsh. However, when you consider that businesses need a number of permits and licenses before they can, even, hope to begin operations, you have got to say that the government appears to have its hands on the throats of the businessmen, at least.

When you consider that these licenses and permits are, rarely, onetime expenses—considering how they need to be renewed after a certain duration—you have got to say that the costs will start to mount without you even knowing, fully, of it.

Maintenance

Businesses require regular maintenance, in a number of departments, if they are to continue their operations. While the costs of the bigger and major equipment, for example, is already accounted for in the annual budget; it is the smaller maintenance costs that tend to build up, until they become too much to handle.

This means that it is imperative for businesses to keep ALL maintenance costs into consideration, when forming the budget, so that they can know, for sure, that everything has been accounted for. When it comes to costs, businesses need to remember that it is NEVER good to be taken by surprise!

Equipment

Businesses require equipment for their operations, right? Well, the kind of equipment that a business has got is an important consideration as well. Businesses are, obviously, recommended to have state-of-the-art equipment so that they are able to make use of the latest technology, in their business operations. However, that doesn’t mean that businesses should start splashing cash around, just because they are looking to upgrade the equipment.

It is essential for businesses to remember that equipment related upgrades should only be made if the business ACTUALLY needs it, and not just because the newer equipment looks “cool”. Spend a bit too much on equipment and you will soon find your business to be in a liquidity crunch.

When you take it all into perspective, you have got to say that businesses need to decrease their costs, as much as possible, if they are to boost their earnings, right? These costs—hidden or visible—can be steep no doubt, but there are ways in which they can be taken care of in the least expensive manner.

If you, too, are looking to reduce the costs associated with your business, as much as possible, the experts at SKB Accounting have got just the tips you need!

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Importance of Business Integration for Growth

Importance of Business Integration for Growth

When you speak of business growth in the contemporary world, there are certain internal factors which have become exceedingly important, with the passage of time. Among these; business integration has grown in importance very rapidly. Here are some of the reasons why business integration is important for the growth of a business:

Communication

One of the major benefits of business integration is in the streamlining of the sphere of communication. Businesses that are well-integrated offer streamlined communication between all of the involved parties and participants. Regardless of how different the operations of these participants might be, a well integrated business will ensure that everyone is able to get their word in, especially when it matters. A better means of communication will ensure that the sharing of information becomes dramatically easier and cheaper, meaning that the probability of bad decisions will be considerably reduced, especially due to the lack of access to information.

Available Resources

When you speak of business integration, it is a fact that it allows businesses to make the most of the resources that are at their disposal. It is because business integration lets companies leverage their employees and resources in such a way that they are able to extract the maximum possible utility from them. It has been proven that integrated organizations don’t waste the potential of their employees by assigning jobs that are meaningless or repetitive. On top of that, organizations can also benefit by integrating with companies such as PayPal and Amazon, all for the purpose of getting the most out of their resources and potential.

Productivity

We all know how organizations wish to increase their productivity as much as possible, right? Well, this end can be achieved if organizations take the route of business integration. Businesses that are integrated reduce the need for data duplication so that it may be used at different places, for different purposes. With the need for duplication reduced, employees can focus on the issues that really matter. On top of that, integration with PayPal, for instance, will reduce the need for a business to focus on its system of payments.

Growth

Having a business integration setup in place ensures that all of the data for businesses is hoarded at a singular location so that it might be accessed and made use of easily, by everyone relevant. The simplistic nature of the sharing of information adds to the growth of the organization, owing to how problems will then be solved in a few clicks, as compared to accessing different systems, which would need to be done otherwise.

When you put everything into perspective, the importance of business integration cannot be denied. Businesses not only need to be internally integrated but integrated with companies such as Amazon and PayPal as well, if they are to grow in the contemporary world. Bearing this in mind, the experts of SKB Accounting are best equipped to take care of all of the needs you might have in this regard!

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Accounting-Best Practices

If you own a business, one of the most important things you should do is to keep careful track of your expenditures and income. This is not only necessary to keep your business afloat financially, but also is an important way to analyze your spending and predict your future revenue. Careful business analysis allows you to predict what your future will be in a way that is not possible otherwise. But this requires best practices in accounting and bookkeeping. To do this efficiently and in a way that will best help your business, here are some of the best practices, according to accounting experts:

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Renting Out a Vacation Home

Tax rules on rental income from second homes can be complicated, particularly if you rent the home out for several months of the year, but also use the home yourself.

There is however, one provision that is not complicated. Homeowners who rent out their property for 14 or fewer days a year can pocket the rental income, tax-free.

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10 Reasons Why Outsourced Bookkeeping Can Increase Your Productivity

Do bookkeeping chores take an excessive amount of time off from your core business? Is using an Associate in Nursing accounting workers cost-prohibitive?

once bookkeeping tasks are a struggle, you wish expert facilitate. If you can’t rent a regular bookkeeper however would love all the advantages of getting one, outsourced bookkeeping may be the proper resolution.

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