Waukesha Accountants | Small business accounting

Here are 5 simple tips to keep your small business accounting in order from Forbes ,

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1. Keep it separate. That new backpack for your kids isn’t a business expense, but your business credit card was handy so you used it. Sure, you can pay back your business for a personal expenditure, or the other way around, but if you’re going to do it right you actually have to record an accounting transaction. Things get complicated fast, and you don’t need that headache. By keeping separate bank and credit card accounts for business and personal, you’ll save yourself hours of work and make it easy to keep track of deductible expenses in one place. Some applications can automatically handle the behind-the-scenes accounting for crossover expenses, but even so, we recommend handling business and personal finances as independently as possible.
2. Call in a pro. Since the days of the abacus, accountants have been trusted and respected allies to small business owners everywhere. Their intimate knowledge of the profession as well as tax laws in their jurisdiction will save you money almost every time. I know how tempting it can be to save a buck and do it yourself, but it’s almost never more cost-efficient in the end. An accountant will almost always find more deductions and keep you penalty-free. On that note, the cleaner your records, the fewer billable hours you’ll have to pay, so make sure you’re organized year-round. But when things get technical or taxes are due, save yourself the money, time and headaches and call in a trusted professional.
3. Pencil it in. Actually, use a pen. A permanent marker even. Set aside about 15 minutes every week — that’s the equivalent of just one Facebook visit every seven days — to organize your finances, and don’t let other things take priority during this time.  You’ll have more insights into your business, be able to make more informed financial decisions and have everything organized when tax time approaches. Something always feels more pressing than your finances. But when you find the time every week, you’ll feel your stress levels — now and at year-end — fall fast.
4. Consider your people. When you’re looking for insights into your businesses spending, don’t forget to properly track what is likely one of your biggest expenses: labor. Whether you’re paying a full staff or you’re the only one on the payroll, make sure you’re tracking the costs of wages, benefits, overtime and any other costs associated with labor. By tracking your spending on labor, perks and benefits, you may find you have more money to incentivize your employees — or that you’re outspending your budget. Either way, doing the math now can help you make better decisions later.
5. Finally, don’t forget to get paid. This one seems pretty obvious, but you would be shocked at how many small business owners don’t properly track invoices and customer payments. If you’re not keeping proper records that you can make sense of at a glance, it could be months before you realize you have outstanding invoices. You could be collecting payments late, or missing some altogether. Make sure you’re properly tracking all payments due and recording when each invoice is paid, how long customers generally take to pay, and which customers you’ve had difficulties collecting payments from in the past.

Small Business Accounting In Waukesha | Edith Christian

Here are 5 tips for small business owners.

1. Budget your spending. Hyder says the best way to run your small business is to know how much money you need to make in order to break even and how much you have to spend to run your business on a daily basis. Separate your business budget into 4 categories:
i) prospective income
ii) fixed expenses
iii) variable expenses
iv) paycheque-allowance
The key to financial discipline is realistic balancing of needs versus wants.
2. Don't Spend. Invest. Spend your hard-earned money on things that will reap long-term benefits. Every expense has two faces: current benefits and long-term benefits. Businesses that spend on a long-term investment nature reap its benefits much longer. But remember to balance the cost versus the benefit. If your expense doesn't directly help you in increasing your business or quality of your work, don’t spend on it.
3. Maintain Records. Keep all receipts, organized, in a safe place where you will be able to find them when you need them. The top four reasons for lost records are:
i) They simply weren't kept.
ii) They were kept but are so disorganized you can't make sense of them.
iii) They were kept very organized but got washed or destroyed.
iv) They were kept safely and organized in a place but you can't find them. Spend a few minutes a day to organize your documents and avoid losing anything.

Don’t squander away your precious time by struggling with complicated IRS forms and complex bookkeeping chores. You can get fast and effective solutions to all of your tax and accounting affairs when you employ Edith I Christian, CPA. We know how stressful your life can be. But when you call on us, you can relax a little bit. Our professionalism, integrity and trusty service make your life less taxing. Plus, we focus on delivering peerless customer service to ensure the satisfaction of every single client. Our name is indelibly linked with characteristics such as honesty, reliability and outright excellence. You can count on us! Are you ready for more information? Call today 262-646-2008

When is it time to hire an accountant or Bookkeeper | Edith Christian Accounting Milwaukee | Waukesha

Sometimes you can only go so far as far as being on top of your Milwaukee business and its accounting, sometimes it is time to have someone take over your accounting and bookkeeping so you can concentrate on your business
Here is a great article from FORBES.com

Entrepreneurs thrive on a DIY mentality: Do everything you can yourself and don't pay for anything new until you have absolutely have to. It's especially difficult to justify hiring financial help like a bookkeeper.
With user-friendly software such as QuickBooks available, many business owners feel they should be able to do keep their records on their own, even as they wrestle with finding the time and wonder if they're doing things correctly.
Deciding about "hiring a bookkeeper is something I struggle with all the time," says Randy Mitchelson, owner of National Web Leads, an Internet marketing company in Estero, Fla. While he finds basic accounting easy to do, it takes him away from working on his business. Meanwhile, his accounting and tax planning have become only more complicated in the six years since he founded his business.
Entrepreneurs who hire accounting help usually discover they weren't doing nearly as well on their own as they thought they were.
Zalmi Duchman, chief executive of The Fresh Diet, a meal-delivery company based in Miami, lasted five years without a bookkeeper then hired one three months ago. The new employee cleaned up records that incorrectly mingled expenses and assets, reviewed employee purchases for duplications, and took over the mundane but critical task of paying bills. Duchman estimates his company is saving $500 to $1,000 in late fees every quarter. "I definitely have been able to make better and more educated decisions," he says.
So what are a small-business owner's options for professional help with financial tasks? Here is a primer:
Do I Need a Bookkeeper or an Accountant?Actually it's a trick question. You may need both.
Aaron Sylvan, a serial entrepreneur who lives in New York, compares the situation to needing to hire both a carpenter and an architect when building a house.
An accountant can analyze the big picture of your financial situation and offer strategic advice. He or she produces key financial documents, such as a profit-and-loss statement, if needed, and files a company's taxes.
After tax season is over, an accountant can also act as an outsourced chief financial officer, advising an entrepreneur on financial strategies, such as whether to secure a line of credit against receivables when introducing new products.
In contrast, a bookkeeper does the day-to-day hands-on tasks: making sure new employees file all the right paperwork for the company's payroll, submitting invoices (promptly) and following up on them, and paying the bills. The bookkeeper also tracks company expenses and can assure that every cost has been entered -- and recorded correctly -- into software like QuickBooks so that the business is ready for tax time along with filing any other reporting to, say, creditors or investors.
"I don't keep receipts; they're a pain," says Sylvan, who runs Sylvan Social Technology, an ecommerce-services company. "Every month I get a bank statement with a gazillion transactions," such as taxi rides, meals, conferences and other expenses he has placed on his company's debit card.
His bookkeeper spends a few hours a week sorting it all out. As a result, Sylvan has a better idea about how his expenditures stack up against his budget. He knows he won't bill clients incorrectly or miss important payments.
"Knowledge is power," even when it comes to the small details, Sylvan says. "If you don't have a bookkeeper, you're probably not being as strategic as you could be in how you spend your money."
When to Bring in a BookkeeperIn his running a half-dozen businesses the past 15 years, Sylvan has typically hired a bookkeeper for a few hours a week within a few months after starting a new venture. For the first six to nine months, he's usually too busy to focus much on recordkeeping, then "things begin to stabilize," he says. "Then you can see trends and you can start to think strategically about where your money is going and where you can save." And this is when a bookkeeper becomes valuable. Since Sylvan has fewer than a dozen employees at each new company, the bookkeeping takes about one day a month, he says.
The rates for hiring a bookkeeper on a part-time basis in the U.S. can range from $15 to $60 an hour, depending on location, the workload and whether work is done at the company's office or from home.
Sylvan typically sees his accountant once a year, at tax time. But business owners requiring capital or frequently negotiating credit with a bank are likely to contact their accountants more often.
When to Hire a Staff Accountant or Bookkeeper Many small entrepreneurs can probably stick to outsourcing accounting or bookkeeping services for quite some time. The typical service business can often outsource its chief financial officer tasks and bookkeeping until its revenues rises well above the $1 million mark -- or until it has about 30 employees. Until then, most businesses usually don't have enough work to keep a full-timer busy every day.
It's time to hire full-time help, though, when you're calling your accountant often enough that you wish he or she were in the office all the time. Bring in a full-time bookkeeper when your part-timer is spending two or three full days in the office and still falling behind.
Most new business owners find a staffing solution somewhere along the continuum that ranges from trying to go it alone and paying for full-time help.

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Edith Christian Cpa Waukesha | Accounting Services for Small Business

Bank Reconciliation
^{Reconciling your business checking account each month allow us to keep your bank account, accounting, and taxes up-to-date.
Having us reconcile your account each month allows you to...}

• ^{Identify lost checks, lost deposits and unauthorized wire transactions.}
   
• ^{Detect and prevent excess/unjustified bank charges and ensures transactions are posted correctly by your bank.}

 

• ^{Know how your business is doing? You can't really know unless all accounts are reconciled and properly accounted for on your financial statement.}
   
• ^{Manage your cash more effectively. Proper management of funds not only saves money, it makes money for you.}
   
• ^{Protect yourself. By timely reconciling and promptly objecting to your bank about any unauthorized, fraudulent or forged checks presented to your bank and paid by that bank, you can relieve your agency of responsibility for the shortfall and transfer the risk to the bank. This reason to reconcile alone should be enough. Crime exists.}
   
• ^{Sleep Better. You will sleep more peacefully at night knowing your bank accounts are reconciled, in balance and that all escrow funds, accounts, checks and disbursed funds are properly accounted for.}

 
^{Income Statement
An income statement, otherwise known as a profit and loss statement, basically adds an itemized list of all your revenues and subtracts an itemized list of all your expenses to come up with a profit or loss for the period. An income statement allows you to...}

• ^{Track revenues and expenses so that you can determine the operating performance of your business.}
   
• ^{Determine what areas of your business are over-budget or under-budget.}
   
• ^{Identify specific items that are causing unexpected expenditures. Like phone, fax, mail, or supply expenses.}
   
• ^{Track dramatic increases in product returns or cost of goods sold as a percentage of sales.}
   
• ^{Determine your income tax liability.}

^{Balance Sheet
A balance sheet gives you a snapshot of your business' financial condition at a specific moment in time.
A balance sheet helps you...}

• ^{Quickly get a handle on the financial strength and capabilities of your business.}
   
• ^{Identify and analyze trends, particularly in the area of receivables and payables. For example, if your receivables cycle is lengthening, maybe you can collect your receivables more aggressively.}
   
• ^{Determine if your business is in a position to expand.}
   
• ^{Determine if your business can easily handle the normal financial ebbs and flows of revenues and expenses?}
   
• ^{Determine if you need to take immediate steps to bolster cash reserves?}
   
• ^{Determine if your business has been slowing down payables to forestall an inevitable cash shortage?}

^{Balance sheets, along with income statements, are the most basic elements in providing financial reporting to potential lenders such as banks, investors, and vendors who are considering how much credit to grant you.}

^{Maintaining a Clean General Ledger
The general ledger is the core of your company's financial records. These records constitute the central "books" of your system. Since every transaction flows through the general ledger, a problem with your general ledger throws off all your books.
Having us review your general ledger system each month allows us to hunt down any discrepancies such as double billings or any unrecorded payments. Then we'll fix the discrepancies so your books are always accurate and kept in tip top shape.}