IT’S A BEAUTIFUL PORTRAIT OR IS IT?
The first thing I hear, when I tell people that I own a professional bookkeeping service and that I do tax preparation is; “you must really like numbers.” I guess I do, but more importantly I understand them. Financial analyst and business growth involves numbers but those numbers paint a picture of a business, the business owners and the management of that business. In any corporation or large business, you will notice a full accounting department. They have people who specialize in accounts receivable which means to post (document) the monies that flow into that business. He or she will bill or invoice clients, monitor the cash flow and record each transaction from sales to sale tax, and so forth. You’ll notice an account payable department whose primary responsibility is ensure creditors are paid on time but at the same time monitoring cash flow to ensure that there is enough money for opportunities that may arise for the business. The accounts payable team monitors inside purchases and tracks them for budgeting reporting, to remain cost effective and for security measures. There is usually a staff accountant who works amid the two groups just describe to pull information for financial reporting. Information from the sales (account receivable department/revenues) and expenses (account payable department) is placed onto a P&L (Profit & Loss) Statement. This report is performed monthly; there is usually a side-by-side comparison, from one month to the next month, even for the same month in the last year, quarter-to-quarter and so forth. Before compiling this report, the staff accountant will reconcile the bank account, something most entrepreneurs (self-employed business owners) will not have or find the time to do and may not understand the importance of doing. Reconciling is a crucial step, you can find fraud, irregularities on an account, and most importantly it is balances your bank account to your books making your bookkeeping verifiable. Receipts, invoices, are not verifiable sources and creating reports from those items doesn’t carry any weight.
That staff accountant also in most cases provides managerial reports. Managers in different departments of the company need different reports to determine and meet different needs. The marketing department needs to see the cost of advertising and the sales in hopes to determine if their methods are working and reaching the correct target market, while Human Resources needs to know the cost of replacing an employee, the cost of retaining employees, benefits costs etc… Well if you are an entrepreneur, a self-employed business owner, you are all those departments rolled into one and you need the answers of a complete management team.
The accounting department working as a team provides an accurate picture for management as well as potential investors. You can tell the picture is painted accurately and not rushed to be completed at year end. The numbers are in sync, the numbers make sense, the financial responsibility is managed, there are reserves, there is savings, there is planning and strategic methods for reaching higher goals and making more money. The accounting department also holds meetings with the management team to discuss expectations, forecasts, budgets and meeting those budgets.
Most entrepreneurs cannot in the beginning afford the expense of an accounting department or even a visit to the CPA’s office; however, Elite Expert provides professional bookkeeping services that ensure your company’s revenue and expenses will be recorded in a timely fashion on a monthly basis and our packages are design to work with your CPA providing all the information needed for tax preparation.
Money Meetings is the consulting side of business services crucial to making sure that the goals of the entrepreneur, it is the time when the magic painting of the numbers is discussed so that the management now understands the numbers that he or she has, how to use them, where to cut corners, where he or she can be more courageous; compare month-to-month data with fresh numbers and know exactly where he or she is with the business, tax planning, tax payments and anything else essential to the success of the business.
The numbers of and from your Accountant are magical and the picture can be beautiful or dismal, it’s a matter of when you look at them and the eyes of your understanding. Let Elite Expert paint a picture for you!
