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Why Monthly Bookkeeping Saves Time, Stress, and Money

Mon, 27 Apr 2026 13:32:02 GMT

At LDG Accounting Services, one of the most consistent patterns we see is this: organizations that keep their books updated monthly operate with more clarity, less stress, and better outcomes over time.

Monthly bookkeeping is not just about staying organized. It’s about staying informed.

When financials are current, leaders are able to make decisions based on what is actually happening, not what they hope is happening.

For Businesses: Clarity Supports Better Decisions

For business owners, monthly bookkeeping provides a clear view into how the business is performing in real time.

Margins become easier to monitor.

Payroll growth can be evaluated with confidence.

Tax exposure becomes more predictable instead of surprising.

This allows you to make adjustments during the year instead of reacting after the fact.

When financials are current, decisions around hiring, pricing, and investment are grounded in reality, not guesswork.

For Nonprofits: Financial Visibility Strengthens Your Mission

For nonprofit leaders, monthly bookkeeping plays a critical role in financial stewardship and reporting.

Grant activity can be tracked more accurately.

Board reporting becomes more consistent and easier to prepare.

Audit readiness improves significantly when records are maintained throughout the year.

When financial information is clear and up to date, it becomes easier to communicate with your board, plan for upcoming needs, and stay focused on your mission.

Less Stress at Critical Moments

One of the biggest differences shows up during key moments like tax season, audits, or financial reviews.

When books are updated monthly, those moments tend to be straightforward. The information is already there, organized, and reliable.

When bookkeeping is delayed, those same moments often turn into time-consuming catch-up work under pressure.

The work itself doesn’t disappear. It simply shifts to a more stressful time.

Time and Cost Savings Over Time

It may seem counterintuitive, but consistent monthly bookkeeping often reduces overall cost.

When financials are maintained regularly:

fewer errors need to be corrected later
less time is spent reconstructing past activity
professional services can focus on planning instead of cleanup

This creates a more efficient process and allows time to be spent where it adds the most value.

A Strong Foundation for Growth

Whether you are running a business or leading a nonprofit, growth depends on having a reliable financial foundation.

Monthly bookkeeping helps ensure that:

decisions are based on accurate information
obligations are anticipated
opportunities can be evaluated with confidence

It’s a simple discipline that supports long-term stability.

LDG Accounting Services Can Help With Your Bookkeeping

At LDG Accounting Services , we work with businesses and nonprofits to maintain clear, consistent financials and provide guidance throughout the year. If you would like to review your current process or explore a more structured approach, we’re always happy to start that conversation. Contact us today to learn more.

The 5 Cash Flow Numbers Every Small Business Owner Should Review Monthly

Mon, 23 Mar 2026 14:17:35 GMT

2. Accounts Receivable

At LDG Accounting Services, we often see business owners focus heavily on revenue and profit. Those numbers matter, but they do not always tell you whether your business feels financially stable.

Cash flow clarity is what allows you to plan instead of react. You do not need dozens of reports each month. You need visibility into the right numbers.

These five cash flow numbers deserve a monthly review:

1. Cash on Hand

Cash on hand shows how much immediate flexibility your business has. It reflects the cushion available to cover payroll, vendor payments, or unexpected expenses.

Knowing this number reduces uncertainty. It helps you make decisions from a place of awareness rather than assumption.

2. Accounts Receivable

Revenue is not cash until it is collected.

Accounts receivable shows how much money is still tied up in unpaid invoices. Reviewing this monthly helps you identify slow-paying clients, adjust follow-up processes, and protect liquidity before cash feels tight.

3. Monthly Cash Inflows vs. Outflows

Are more dollars coming in than going out?

Comparing inflows and outflows reveals whether your cash position is strengthening or shrinking over time. Even profitable businesses can experience pressure if expenses are consistently outpacing collections.

This trend matters more than any single month.

4. Upcoming Obligations

Certain expenses do not wait.

Payroll, loan payments, vendor bills, and quarterly tax obligations affect cash regardless of profit. April, in particular, is a good reminder that tax payments and compliance deadlines require proactive planning.

Building awareness of what is due in the next 30 to 60 days helps prevent last-minute stress.

5. Cash Runway

Cash runway answers a simple but powerful question:

If income slowed, how long could the business continue operating?

Understanding runway provides perspective. It supports thoughtful decisions about hiring, investments, and growth without overextending resources.

How Cash Flow Numbers Change the Way You Lead

Together, these five numbers provide a clearer picture of financial health than revenue alone. They help you identify trends early, manage seasonality, and maintain steady operations.

Financial confidence does not come from watching one metric. It comes from understanding how cash moves through your business.

LDG Accounting Helps Small Businesses

LDG Accounting Services supports small business owners with monthly accounting, cash flow visibility, and proactive guidance. When you understand your cash position, you can move forward with clarity and confidence. Contact us today to discuss your accountin g and bookkeeping needs.

Why Your Bank Balance Does Not Match Your Financial Reports (And What to Do About It)

Wed, 25 Feb 2026 15:19:06 GMT

Does Your Bank Balance Reflect Your Profitability?

One of the most common questions we hear from both business owners and nonprofit leaders is this: “If we’re profitable, why doesn’t our bank balance reflect it?”

This disconnect can be confusing and stressful. It can also lead to hesitation around hiring, investing, or expanding programs, even when the organization is doing meaningful and effective work.

The good news is this situation is very common, and it is usually explainable and manageable once you understand what is happening behind the numbers.

Profit, Reports, and Cash Do Not Move the Same Way

Financial reports and bank balances tell related but different stories. Your reports reflect financial activity based on accounting rules. They show revenue earned and expenses incurred during a period.

Your bank balance reflects cash that has actually moved in or out.

Because of timing, structure, and funding sources, it is possible to show strong results on paper while cash feels constrained.

This is true for both for-profit businesses and nonprofit organizations.

Common Reasons the Numbers Do Not Line Up

While the mechanics differ slightly by organization type, the root causes are often similar.

For businesses and nonprofits alike:

Revenue recorded before cash is collected
Expenses paid before related income arrives
One-time purchases that reduce cash immediately
Growth or program costs paid upfront
Taxes or obligations not yet set aside

Additional realities for nonprofits:

Grant revenue recorded before reimbursement is received
Restricted funds in the bank that cannot be used for operating expenses
Pledges recorded as revenue but not yet collected
Funding timing that does not align with payroll or vendor schedules

In all cases, cash timing matters just as much as financial performance.

Why This Gap Matters

When the gap between reports and cash is not clearly understood, it often creates unnecessary stress.

Leaders may:

Delay hiring even when work is increasing
Postpone investments that would support growth or impact
Question financial stability despite solid performance
Feel uncertainty that affects day-to-day decision making

A lower bank balance does not mean failure. It usually means money is moving differently than the reports suggest.

Understanding that difference brings relief and confidence.

What Helps Create Financial Clarity

A few practical habits can significantly improve visibility and reduce surprises.

For all organizations:

A consistent monthly close so reports are timely and reliable
Clear tracking of accounts receivable and expected deposits
Awareness of upcoming large payments or obligations
A short-term cash forecast to anticipate tighter periods

For nonprofits specifically:

Clear separation of restricted and unrestricted cash
Visibility into pending grant reimbursements
Simple communication tools that explain cash timing to boards and teams

These tools do not need to be complicated. They need to be consistent and understood.

Using This Information with Confidence

When leaders understand the relationship between reports and cash, conversations change. Business owners gain confidence in planning, staffing, and reinvestment decisions. Executive Directors can explain cash constraints without alarm and align program activity with funding timing. Board members can distinguish between short-term cash timing issues and long-term sustainability.

Finance committees can focus on proactive guidance rather than reactive problem solving.

Clarity leads to better questions, better communication, and better decisions.

LDG Accounting Can Provide A Steadier Way Forward

Understanding why your bank balance does not match your reports is not about fixing a mistake. It is about seeing the full financial picture.

When profit or reported results are connected to real-world cash movement, the numbers start to make sense. Stress decreases. Decisions become clearer. Planning feels more grounded.

LDG Accounting Services supports small businesses and nonprofits by helping leadership teams connect financial reports to cash reality. Through thoughtful accounting, cash visibility, and ongoing guidance, we help organizations move forward with confidence and clarity.

LDG Accounting Services in Georiga helps nonprofits and small businesses move forward with clarity and efficiency. Contact us for a free discovery call.

Cash Flow vs. Surplus (or Profit): Why Financially “Healthy” Organizations Still Struggle

Wed, 04 Feb 2026 12:55:54 GMT

Do Your Numbers Just Look Good On Paper?

At LDG Accounting Services, one of the most common things we hear—from nonprofit leaders and for-profit business owners—is:

“Our numbers look good on paper, but cash still feels tight.”

That confusion is understandable. Whether you’re running a nonprofit or a for-profit business, profit or surplus does not equal spendable cash. And misunderstanding that difference is one of the biggest causes of financial stress—even in otherwise well-managed organizations.

Profit or surplus isn’t the same as cash

A profit (for businesses) or surplus (for nonprofits, also called a “positive change in net assets”) is an accounting result over a period of time. It tells us that revenues exceeded expenses.

Cash flow, on the other hand, tells us whether money is actually available right now to run payroll, pay vendors, cover program or operating costs, and meet loan or tax obligations.

In short: profit or surplus reflects performance; cash reflects capacity today.

Why cash can feel tight even when the numbers look strong

Cloud systems, bank feeds, and digital tools make bookkeeping faster than ever. But automation doesn’t guarantee accuracy. If accounts aren’t set up correctly—or if no one reviews the transactions—reports can look clean while telling the wrong story.

In 2026, strong accounting is less about data entry and more about:

Reviewing and correcting automated categorizations
Ensuring reporting matches real business activity or donor intent
Interpreting the numbers to support smarter decisions

Cash Flow Is a Universal Pain Point

Cash flow problems are almost always about timing, not mismanagement.

For nonprofits, cash pressure often comes from:

Restricted donations that can’t be used for general operations
Reimbursement-based grants where expenses happen before cash arrives
Pledges recorded as revenue but not yet collected
Timing differences between revenue recognition and actual deposits

For businesses, common cash strain comes from:

Customers paying slower than expected
Growth expenses that require upfront cash
Loan principal payments that reduce cash but don’t show clearly on the P&L
Tax obligations created by profitable months without cash set aside

In both cases, the organization may be doing many things right—and still feel squeezed.

Growth can make cash tighter, not easier

One of the most counterintuitive realities: growth often increases cash pressure.

More sales or more programs usually mean more payroll, more materials or program costs, and more overhead before revenue is collected.

Without cash planning, growth can strain operations instead of strengthening them.

What healthy cash management looks like

Once organizations start managing cash intentionally, stress drops and decisions improve.

 Healthy cash management includes:

Tracking unrestricted or operating cash separately from total cash
Monitoring receivables, reimbursements, and payment timelines
Building a short-term cash forecast (often 8–13 weeks)
Separating reserved cash (taxes, grants, savings) from operating funds
Communicating cash timing clearly to leadership and boards

These practices turn cash from a constant surprise into a manageable planning tool.

How leaders and boards can use this information

Executive Directors and business owners can use the cash vs. profit distinction to plan staffing and commitments realistically, avoid “emergency” financial decisions, and explain financial realities clearly to boards, lenders, and funders.

Board members and finance committees can use it to strengthen fiduciary oversight without panic, ask better questions about unrestricted reserves and timing risks, and support smarter reserve and sustainability planning.

Understanding cash flow helps everyone focus on real financial health—not just good-looking reports.

The Bottom Line For Cash Flow Struggles

Organizations don’t usually struggle because they lack mission or sales. They struggle because cash timing is unpredictable—and accounting results don’t tell the whole story.

When you understand cash flow alongside profit or surplus, you make steadier decisions, communicate more confidently, and protect your organization’s ability to operate and grow.

LDG Accounting Helps Small Businesses and Nonprofits in Georgia

LDG Accounting Services helps nonprofits and small businesses build clear, decision-ready financial reporting. We support monthly financials, cash flow forecasting, and fund tracking so you can plan proactively instead of reacting under pressure. Contact us for a free discovery call.

Profit or Purpose: Why Accounting Matters More Than Ever in 2026

Wed, 07 Jan 2026 14:13:29 GMT

What Does Accounting in 2026 Look Like?

Accounting in 2026 looks very different than it did just a few years ago—for both for-profit businesses and nonprofit organizations. While their goals may differ, the need for clear, reliable financials has never been greater.

Accounting is no longer something we think about only at tax time or year-end. It’s a tool for clarity, sustainability, and confident decision-making—whether you’re protecting profit margins or protecting a mission.

What Has Changed in 2026

Accounting is now a year-round leadership tool—not a once-a-year task.
Automation is everywhere, but accuracy still requires human review.
Compliance requirements are increasing in both sectors.
Cash flow visibility matters just as much if not more as the bottom line.

For-Profit vs. Nonprofit: Different Goals, Similar Pressures

For-profit organizations tend to use accounting to answer questions like:

Are we profitable by product/service?
Can we afford to hire or increase payroll?
What does cash flow look like over the next 30–90 days?
What is our tax exposure before year-end?

Nonprofit organizations tend to use accounting to answer questions like:

Are we spending grant funds correctly and on time?
Do we have enough unrestricted cash to cover operations?
Can we staff programs responsibly without creating a cash gap?
How do we clearly report financials to the board and funders?

Automation Helps—But It Doesn’t Replace Oversight

In 2026, strong accounting is less about data entry and more about:

Reviewing and correcting automated categorizations
Ensuring reporting matches real business activity or donor intent
Interpreting the numbers to support smarter decisions

Cash Flow Is a Universal Pain Point

Strong sales don’t always mean strong cash flow—and neither do large grants or successful fundraising. Timing matters. Understanding when money is actually available helps leaders plan instead of react.

Better cash flow visibility helps organizations:

Avoid last-minute payroll or vendor stress
Plan program timelines realistically
Make smarter hiring and spending decisions
Build stability even during seasonal slowdowns

Compliance Pressure Keeps Rising

Businesses face growing complexity around payroll filings, sales tax, entity reporting, and regulatory changes. Nonprofits face audits, grant compliance, restricted funds, and higher transparency expectations. Clean, organized books reduce stress and prevent costly mistakes.

Our Accounting Team Can Help & Support Your Business or Nonprofit

Bottom line is that our accounting team can help. Whether the goal is growth or impact, leaders want the same thing: numbers they can trust, no surprises, and financial clarity that supports confident decisions.

At LDG Accounting Services , we help both businesses and nonprofits move beyond basic bookkeeping with monthly reporting, cash flow insight, and proactive support—so your numbers work for you, not against you. Contact us for a free discovery call.

Wrap Up Your Year with a Profit Check, Not Just a Bow

Mon, 08 Dec 2025 14:07:42 GMT

A Year-End Profit Check Is Important

The end of the year is filled with celebrations, but before you close the books on 2025, it’s wise to take a closer look at your numbers. A year-end profit check does more than confirm performance – it gives you clarity, highlights opportunities, and sets the stage got an even stronger year ahead.

Review Revenue, Expenses and Profit Margins

Reviewing revenue, expenses, and profit margins now can reveal what worked, what didn’t, and where to adjust. It’s also the ideal time to plan for taxes, assess cash flow, and establish measurable goals for the upcoming year. By closing out your financials with care, you ensure your business heads into January with insight, not uncertainty.

Grant Your Business The Gift of Growth

This season, give your business the gift of foresight. A profit check today is the bow that ties together a successful year – and the first step toward sustainable growth in the next.

Our Accounting Team Is Here To Help

The LDG Accounting takes a personal, hands-on approach which allows us to help our clients reach the next level. We offer both in-person and virtual accounting and bookkeeping services for your convenience.

We’re thrilled to be nominated for the 2025 Best of Gwinnett Awards! Every vote counts, and we need yours. Vote often! Cast your vote today to help LDG Accounting Services win! https://www.guidetogwinnett.com/united-states/suwanee/financial-services/ldg-accounting-services then click “Vote for us”!

Have a wonderful holiday season!

Gratitude for Loyal Customers Builds Lasting Success

Thu, 06 Nov 2025 13:03:45 GMT

Give Thanks For Your Loyal Customers

November is the month of giving thanks – and for businesses, there’s no greater reason to be grateful than loyal customers. Beyond one-time sales, it’s repeat clients who drive growth, build stability, and help sustain long-term success.

Show Your Customers Appreciation

Their continued trust not only fuels revenue but also strengthens your reputation through referrals and word-of-mouth. And what creates that loyalty? Consistency, clear communication, and a genuine expression of appreciation. Whether it’s a simple thank-you, a rewards program, or a personalized follow-up, small gestures go a long way in building relationships that keep customers coming back.

Loyal Customers Are A Valuable Asset

Gratitude isn’t just good manners – it’s a smart business strategy. Showing appreciation today lays the foundation for tomorrow’s growth, turning one-time buyers into lifelong supporters.

This November, remember: loyal customers are one of your business’s most valuable asset. Investing in them with gratitude will pay back many times over.

We Want To Thank Our Loyal Customers

The entire team at LDG Accounting wants to thank all of our loyal customers. We wouldn't be here without you!

Have a wonderful holiday season!

Scary Numbers? Not If You’re Tracking Them

Thu, 16 Oct 2025 15:28:41 GMT

Uncertain About Your Numbers?

October may bring ghosts and goblins, but in business, the real fright comes from uncertainty. Numbers themselves aren’t scary – what unsettles business owners is not knowing if they’re hitting their targets, overspending, or leaving profit on the table.

Track & Review Financial Data

Regularly tracking and reviewing financial data puts you in control. With accurate, up-to—date reporting, you can identify trends, catch issues early, and make confident decisions that move your business forward. Instead of fearing surprises, you’ll know exactly where you stand.

Budgeting & Forecasting

From budgeting and forecasting to monthly reports, the right systems turn financial data into powerful tools, not scary unknowns. And the best part? You don’t have to manage it all alone – we’re here to simplify the process and give you peace of mind.

Need Help Taking Control Of Your Business Accounting?

This October, face those “scary” numbers head-on. When you track them, you’ll find they’re not so frightening after all – just opportunities waiting to be uncovered. Need a little help along the way? Our accounting team is here to support you and your small business. We invite you to contact us today to discuss your specific accounting needs.

Vote for LDG Accounting for the 2025 Best of Gwinnett Awards

Tue, 14 Oct 2025 13:20:55 GMT

CAST YOUR VOTE FOR US TODAY!

Strengthen Your Year-End Strategy – Review Your Business Budget

Tue, 09 Sep 2025 15:53:50 GMT

Evaluate Your Business's Financial Health

As the year winds down, fall offers businesses a valuable opportunity to evaluate financial health. With seasonal demands and year-end deadlines approaching, now is the time to make sure your budget is aligned with your goals.

Analyze and Adjust

Start by analyzing recent activity. Have costs shifted due to supply chain challenges, staffing needs, or high operating expenses? Did summer bring slower revenue or unexpected expenses? Reviewing your numbers now shows where your resources are going – and whether those choices support long-term growth.

From here, adjust with intention. Maybe you need to prepare for increased holiday demand with extra inventory or staffing. Or, is this the right time to pay down business debt, invest in updated equipment, or build stronger reserves. Adjusting your budget isn’t about cutting corners – it’s about positioning your business for stability and success.

Invest In Your Success

Making this review a yearly habit will improve forecasting, reduce financial surprises, and help you step into the new year with confidence. A thoughtful budget check today is a smart investment in tomorrow’s business success.

Our Accounting Team Is Here To Help

Our accounting team is ready to help you evaluate and elevate the financial health of your small business. Feel free to contact us today to discuss your accounting and bookkeeping needs.

Back to Business Basics - Systems Make Everything Easier

Wed, 20 Aug 2025 13:21:20 GMT

Make Running Your Small Business Easier

Running a small business can feel like juggling flaming torches while riding a unicycle. Exciting? Yes. Sustainable? Not without systems. Clear, repeatable processes turn daily chaos into smooth, predictable operations.

What Is A Small Business System?

A “system” doesn’t have to mean fancy software or complex flowcharts. It’s simply a structured way of doing things so you get consistent results. Think of it as a recipe—you follow the same steps every time, so you know the outcome will be reliable.

For example, an invoicing system ensures bills go out on the same day each week, reducing late payments. A customer onboarding checklist helps you deliver a great first impression every time. Even a standard way of handling email can save hours each week.

The magic of systems is that they free up your brain to focus on growth instead of constantly putting out fires. They make training easier, mistakes rarer, and your time more valuable.

How To Get Started

If you feel overwhelmed in your business, start small. Pick one task you repeat often and document the exact steps. Improve it over time, then move on to the next process.

Better systems lead to better results—and make running your business a whole lot less like juggling torches.

Understanding Nonprofit Funding Sources

Tue, 12 Aug 2025 12:34:51 GMT

Nonprofits Rely on a Variety of Funding Sources

Each type of funding comes with specific advantages and limitations. It is important to d iversify your funding sources to improve financial health and flexibility.

Common Funding Sources Include The Following:

Grants

Source: Government, foundations, corporations; Use: Often restricted; Notes: Large sums; competitive, requires reporting

Individual Donations

Source: Public donors; Use: Restricted or unrestricted; Notes: Flexible; builds community; needs outreach

Corporate Sponsorships

Source: Businesses; Use: Tied to branding/events; Notes: Good visibility; may come with strings

Earned Income

Source: Product/service sales; Use: Unrestricted; Notes: Sustainable; requires business model

Fundraising Events

Source: Tickets, raffles, auctions; Use: Unrestricted; Notes: Engaging; resource-intensive

Endowments & Investments

Source: Investment income; Use: Often restricted; Notes: Predictable; requires significant capital

Funding Types Comparison:

We Help Nonprofits Maximize Their Funding

We help to put nonprofits in a position to succeed. At LDG , we are highly experienced and understand the ins and outs of nonprofit bookkeeping and accounting . Feel free contact us today to discuss how our team can help your nonprofit maximize its positive impact in the community.

Mid-Year Business Financial Review Checklist

Thu, 17 Jul 2025 14:16:50 GMT

1. Review Financial Statements (Jan–Jun)

Analyze Profit & Loss Statement (Income Statement): profit trends, compare to last year.
Review Balance Sheet: assets, liabilities, equity, cash position.
Check Cash Flow Statement: operational cash flow sufficiency.

2. Compare Budget vs. Actual

Highlight areas of over- or under-spending.
Adjust the budget for the remainder of the year.
Reassess income projections based on performance.

3. Evaluate Revenue Streams

Identify most and least profitable products/services.
Consider new revenue opportunities (upsells, pricing, new services).

4. Analyze Expenses

Spot inefficiencies or overspending.
Review subscriptions and vendor costs for savings opportunities.

5. Check Your Taxes

Estimate year-end tax liability.
Make estimated payments if necessary.
Ensure tax records are up to date and organized.

6. Review Accounts Receivable & Payable

Ensure invoices are paid on time.
Follow up on overdue receivables.
Manage vendor payments and take advantage of early-pay discounts.

7. Assess Key Performance Indicators (KPIs)

Gross and net profit margins.
Customer acquisition cost and average sale.
Days sales outstanding (DSO).

8. Check Payroll & Contractor Costs

Review staffing costs and productivity.
Adjust roles or hours if needed to manage costs.

9. Update Financial Goals

Evaluate progress toward 2025 goals.
Adjust goals and targets for Q3 and Q4.

10. Meet with Your Accountant or Bookkeeper

Review overall financial health and discuss tax planning.
Assess business structure, major purchases, or growth plans.

Need Help Reviewing and Analyzing Your Small Business Finances?

We are here to help. The experienced team at LDG Accounting is here to assist you with your small business accounting and bookkeeping. Contact us today.

Comparing Cash vs Accrual Accounting

Thu, 26 Jun 2025 13:53:59 GMT

Here’s both a comparison chart and specific use cases where accrual accounting is strongly recommended:

Use Cases Where Accrual Accounting Is Strongly Recommended

1. Businesses with Inventory

If you sell physical products, GAAP typically requires accrual accounting to properly match cost of goods sold (COGS) with revenue.

2. Businesses with Credit Sales

If you invoice customers and receive payments later, accrual accounting captures income when it’s earned, not when it’s paid.

3. Growing or Medium-to-Large Enterprises

Accrual accounting gives a clearer picture of obligations, which is critical as businesses scale.

4. Companies Seeking External Financing or Investment

Lenders, banks, and investors usually require accrual-based financial statements to evaluate the financial health and risks of a business.

5. Contract-Based or Subscription Businesses

If you receive payment in advance or over time, accrual accounting helps recognize revenue across the contract period appropriately.

6. Businesses Subject to Audits or GAAP Compliance

Public companies, companies preparing for IPOs, or those under regulatory scrutiny need to use accrual accounting.

Need Assistance Determining The Best Accounting Method?

Contact LDG for small business consulting, accounting, and bookkeeping services. We are happy to answer your questions and assist you with moving your business in the right direction. Call or email us today to learn more about how our team can help.

Cash vs Accrual Accounting

Fri, 23 May 2025 14:37:06 GMT

Differences:

The key difference between cash accounting and accrual accounting lies in when revenues and expenses are recorded:

Cash Accounting

Revenues and expenses are recorded when cash is received or paid.
Simple and easy to maintain.
Often used by small businesses and individuals.

Example:

You send an invoice in December but get paid in January.
Under cash accounting, the income is recorded in January, when the cash is received.

Accrual Accounting

Revenues and expenses are recorded when they are earned or incurred , regardless of when the cash is exchanged.
Gives a more accurate picture of a company’s financial health.
Required by GAAP for most larger businesses.

Example:

You send an invoice in December and get paid in January.
Under accrual accounting, the income is recorded in December, when it was earned.

Advantages of Accrual Accounting

Accrual accounting has several advantages over cash accounting, particularly for businesses that need a more accurate picture of their financial position and performance. Here are the key benefits:

More Accurate Financial Picture

Accrual accounting records income and expenses when they are earned or incurred, not when cash changes hands.
This provides a true reflection of business performance over a given period.

Better Matching of Income and Expenses

Revenues and the costs associated with earning them are recognized in the same period.
This helps in evaluating profitability more accurately.

Improved Decision Making

Since accrual accounting gives a clearer view of ongoing financial obligations and receivables, it supports better planning and budgeting.

Required for Larger or More Complex Businesses

Generally accepted accounting principles (GAAP) and IFRS require accrual accounting for public companies and many private companies.
It’s also required if your business has:

- Over $25 million in average annual gross receipts (in the U.S.)

- Inventory as a significant part of operations

Facilitates Credit and Investment Opportunities

Lenders and investors often prefer or require accrual-based financial statements because they reflect long-term financial health and obligations more reliably.

Tracks Accounts Receivable and Payable

You can see how much you’re owed and what you owe, which isn’t possible with cash accounting.
This helps manage cash flow proactively, even if the actual cash hasn't moved yet.

When Does Your Small Business Need to Expand Staff?

Tue, 26 Sep 2023 13:11:12 GMT

Hiring new employees can be an option to help with the growth of your small business. It’s a big scary step and since a business owner may have been the only employee for a while, it is hard to let go of what one may have worked so hard to build. Sometimes a small business owner doesn’t always have the knowledge or experience to navigate the hiring process effectively.

1. IS IT TIME TO HIRE?

It’s a huge transition and the perfect time to do a review of finances with your bookkeeper. If you are turning down business or the quality of your business has changed or the level of service has decreased, you may need ways of strengthening your business. Do you need support staff to assist with day-to-day operations? Do you need someone with a different skillset that can complement your drive and ambition? Do you just need another set of hands? Are you thinking about adding additional products or services and additional help will support your vision? Would you like to open another location and expand your services?

2. HOW MANY HOURS A WEEK DO YOU NEED?

Deciding what tasks and support you need additional will help determine how many hours a week you need help. Do you want or need a part-time person, a full-time or an independent or seasonal contractor? What is your payroll budget?

Part-time staff is usually less than 30 hours a week. Full-time staff works more than 30 hours a week but less than 40. Do you want an independent contractor or a freelance employee? Contractors or seasonal staff may work 0-40 hours a week and can be more of temporary support whether seasonal or short-term. An independent contractor may save some of the costs associated with hiring since they will be responsible for benefits and taxes. While an independent contractor is a great help if specific services are needed or short-term employment is preferred, hiring someone on as a permanent part of the staff shows a business investment in someone else’s future.

3. CREATING A WELL-DEFINED JOB DESCRIPTION

Having a well-defined role and job title is critical for a hiring experience. A job description will spell out skills, experience, and duties will be important criteria for finding the best candidate for the job. What type of person do you need to be the face or backbone of your business, what is your budget for the wages you want to pay and what tasks will they be performing? For a part-time hire, labor rates are parameters to use with hiring and there are also guidelines for positions that allow tipping. This may be a great time to partner with a business consultant to determine an employee handbook or guidelines to follow.

4. WHO WILL DO THE RECRUITING

Recruiting, hiring, and training can be time-consuming and scheduling time to take on this task may be hard to schedule. This may be a good time to outsource with a recruiter or a labor agency. Budgeting for a service should also be included in your hiring plan. As a small business owner, you may be able to streamline the process by using software and a solid filing system. If the business owner is performing all of the recruiting, hiring and training, time will need to be allocated to adequately perform these tasks without interfering with daily operations.

5. ADVERTISE OR SPREAD THE WORD

Sometimes your best hire will be someone you know. Know where you would like to post your open positions depending on the type of employee you want. A part-time employee may not use the same platform for job searching as a full-time employee. You can utilize your client base, friends and family, church members, or social media websites.

6. SELECT, SCREEN AND INTERVIEW

You may find several potential applicants from your job posting. Be selective and screen your applications to determine the candidates you would like to interview. During the screening process, you want to make notes of a few areas. Review an application for grammatical errors and continuity. Review the candidate’s skill set and relevancy to the position. An application should be filled out in its entirety. Sometimes a quick phone interview will give a great opportunity to determine personality and answer questions regarding the application. From this point, you can gauge basic skills and determine if the interview should go forward. Depending on the type of position, you may need several interviews to determine if the candidate is a good fit. Remember this candidate is a potential member of your team and you want the best fit possible not the first person available.

7. WHAT NOT TO SAY

It is important to note the topics that are off-limits during an interview and stress that you are only accepting applications currently and don’t commit to a candidate until you are making the final offer.

It is always helpful to ask for references and follow up with a phone call. With reference, you can discuss skills, qualifications, and dependability.

8. MAKE THE OFFER

Don’t wait too long to make an offer or you may find yourself starting over with a new candidate and settling for the second-best candidate. Establish a relationship with your top candidate from the beginning and share your thoughts on how they can best serve you and your business. Sometimes pay can be a tricky area to negotiate and be certain to document pay rate and other business perks you may be able to offer.

It is a good idea to present your candidate with a written offer including starting pay, benefits, payroll schedule, start date, hours worked per week, conditions of employment, and review schedules.

Your candidate may ask for time to think about the position. This is very common since the candidate may want to discuss with family or just weigh out their options as well. Set yourself a deadline and after a few days, don’t hesitate to follow up with your candidate and ask if they have additional questions. Be prepared for their answer and have another candidate on deck in case the first one declines the offer.

9. SET UP A PAYROLL SYSTEM

Now that your business is growing, and your staff is expanding, a payroll system may help. As a small business owner, you may choose to do this yourself or outsource your payroll. Many small business owners may use a bookkeeper or accountant or outsource to a service like Gusto.

You will need an Employer Identification Number (EIN) which you probably already have since you needed one to set up a business bank account. This is your employer tax ID used to pay taxes for your business and its employees. You can apply for an EIN online and get your number instantly.

10. ADDITIONAL LEGAL REQUIREMENTS

Hiring new employees can introduce new employment laws and guidelines that you must follow. You will want to make sure to get accurate information on this as it may change from place to place and industry to industry. For example, the Affordable Care Act (ACA) requires some employers to offer health insurance to staff if they work at least 30 hours per week or 130 hours per month. If you do not, you may face penalties.

Additional required benefits can include:

Paying at least the minimum wage for your applicable area
Offering leave benefits
Providing disability insurance
Buying workers’ compensation insurance
Register for state or federal unemployment insurance.
Display workplace rights posters

11. TRAINING AND ONBOARDING

As you begin the process of training, remember that your new employee does not have your knowledge, spirit, or dedication to the business. Even the smallest detail needs to be addressed. Be prepared to be patient and allow your employee to learn and grow.

Prior to the first day of work, communicate to your new employee the dress code, where to park, and where the entrance to the building is. Let them know who they will be training with.

Be prepared for your new hire to arrive on the first day. Have a copy of the handbook, clean the work area, have software logins ready, and be ready to present a work schedule and training expectations. If your business has safety guidelines such as in the food industry, be prepared to discuss these with your new employee and stress compliance.

As you are completing the onboarding process, share your vision and enthusiasm for the business. Let the employee know that you are a resource and are available to help. Present your employee with a training plan and be sure to follow up often to review performance and help your employee feel engaged.

Your business is your lifeblood and represents your hard work and dedication. A new employee does not have that vested interest but you can inspire them to perform to the highest standard. Your new employee will only be as good as your willingness to teach them to do the best job possible. If they work out great, reward them and give them bigger tasks, if they are not a good match, search for a replacement.

As a small business owner, you can stand out in the hiring process when you are looking for the next best team member. Providing flexibility, pay, benefits, and a great working relationship will be helpful in the hiring process. As always, remember to develop your team and have the next best leader waiting to move forward.

Equity vs Debt Financing

Thu, 10 Aug 2023 12:47:33 GMT

1. Ownership and control:

Equity financing involves selling ownership shares of your business to investors, which means you will share control and decision-making power with them. Debt financing, on the other hand, allows you to retain ownership and control of your business while borrowing funds that you will need to repay with interest.

2. Repayment terms:

Debt financing typically involves fixed repayment terms with interest, while equity financing does not require repayment. This means that with debt financing, you will have a clear understanding of your repayment obligations and the cost of borrowing, while with equity financing, you may not know the value of the shares you sold until you have sold them.

3. Risk tolerance:

Debt financing is generally considered less risky than equity financing because you are not risking ownership of your business. However, if you are unable to make your debt payments, you could face serious consequences, such as having your assets seized or your business declared bankrupt. Equity financing, on the other hand, involves sharing the risk with investors, and if your business fails, you may not be personally liable for the debts.

4. Growth and expansion:

If you are looking to grow and expand your business quickly, equity financing may be a better option because it allows you to access large amounts of capital quickly. Debt financing, on the other hand, may limit your ability to grow because you will need to use a portion of your profits to repay your debts.

Consult With a Financial Professional to Determine if Debt Financing or Equity Financing is Best for You

In summary, both equity and debt financing have their advantages and disadvantages, and the decision to seek one or the other depends on your business needs and goals. It's important to carefully consider your options and consult with a financial professional before making a decision. At LDG Accounting , we focus on helping our clients make the best financial decisions for their business. Feel free contact us today to discuss your accounting and financial needs.

Types of Business Structures and Tax Implications

Tue, 11 Jul 2023 11:42:20 GMT

The legal structure of your business can have significant implications on your tax obligations. Here are some ways different business structures can impact your taxes:

1. Sole Proprietorship:

A sole proprietorship is an unincorporated business owned by one individual. The business income and expenses are reported on the owner's personal tax return (Form 1040) using Schedule C. The owner is responsible for paying self-employment taxes on net income and may be subject to estimated tax payments.

2. Partnership:

A partnership is a business owned by two or more individuals who share the profits and losses. The partnership itself does not pay taxes on its income; instead, the partners report their share of the income and expenses on their personal tax returns using Form 1065 and Schedule K-1. The partners are responsible for paying self-employment taxes on their share of the income.

3. Limited Liability Company (LLC):

An LLC is a hybrid business structure that combines the limited liability protection of a corporation with the pass-through taxation of a partnership. The LLC itself does not pay taxes on its income; instead, the members report their share of the income and expenses on their personal tax returns using Form 1065 and Schedule K-1. The members are responsible for paying self-employment taxes on their share of the income.

4. Corporation:

A corporation is a separate legal entity from its owners, and it pays taxes on its income using Form 1120. The owners may also receive dividends, which are taxed at the individual level. This is known as double taxation. However, certain corporations can elect to be taxed as an S corporation, which allows them to avoid double taxation and pass through income and expenses to the shareholders.

Consult With a Tax Professional or Accountant to Determine the Best Business Structure

It's important to consult with a tax professional or accountant to determine which business structure is best for your specific situation and to ensure you are meeting all of your tax obligations. The team at LDG Accounting is here to assist you and would happy to discuss your options. Contact us today.

What is a CPA? Differences in Accounting Titles

Mon, 03 Jul 2023 13:16:15 GMT

Certified Public Accountant

Certified Public Accountant (CPA): A CPA is a licensed accountant who has passed the Uniform CPA Exam and met state-specific education and experience requirements. CPAs can provide a range of services, including audit and assurance, tax preparation and planning, financial planning, and consulting. They have a broad knowledge of accounting principles and can represent clients before the IRS.

Enrolled Agent

Enrolled Agent (EA): An EA is a tax professional who is licensed by the IRS. They have passed a three-part exam that covers individual and business tax returns, and they are authorized to represent clients before the IRS for audits, collections, and appeals. EAs can provide tax planning and preparation services, and they have a deep understanding of tax codes and regulations.

Accountant

An accountant is a professional who manages financial records and prepares financial statements for individuals and businesses. They may specialize in areas such as tax, auditing, or financial analysis. Accountants may hold a bachelor's or master's degree in accounting, finance, or a related field, and they may be licensed as a CPA.

Bookkeeper

A bookkeeper is responsible for maintaining accurate financial records for a business or organization. They record and categorize financial transactions, reconcile accounts, and generate reports. Bookkeepers may not have a degree in accounting, but they should have a solid understanding of accounting principles and software.

Understanding The Differences

In summary, CPAs and EAs are licensed professionals who can provide a range of financial services and represent clients before the IRS, while accountants and bookkeepers may have different levels of education and experience in managing financial records. If your small business or nonprofit needs assistance in Metro Atlanta, contact us today to learn more about our accounting services and bookkeeping .

How Do You Deliver Modern Customer Service to a Modern Customer?

Fri, 24 Feb 2023 13:40:22 GMT

Quality Customer Service Builds Businesses

Warren Buffett said “it takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently. In the last 10 years, there has been a monumental shift in the way we shop, interact with clients and customers, vendors and suppliers and seek help in a technology driven environment that is mostly non-verbal and without personal contact. Most business-related questions and communications are done via email and there has been a shift in the approach to customer service. As shopping habits and expectations are re-vamped and altered, customer service must adapt to the changing needs.

Growth is good but quality of service and customer satisfaction should continue to grow as well. Customers and clients are the heart of any business and how those customers are treated will affect the success of any business. In an environment where people can and will air their grievances to a social media audience of millions a business will have to go above and beyond to create a higher level of service and productivity. It is important to focus on the quality of service and customer satisfaction.

Be Responsive

Wait time is often the most common point of friction with any customer or client. When there is an extended wait time for answers or follow up, a customer will quickly feel like their business is not important and will quickly air their grievances to anyone who will listen. Keyboard warriors take over and any grievance will often be aired publicly without an opportunity to rectify the matters at hand.

Appreciate Loyal Customers

A loyal customer will be a valuable customer. They will patronize a business they value and will rave about that company and the product. One way to repay those loyal customers is by remembering who they are and the services provided that support their business. Making your customer feel known and appreciated will help increase loyalty and increase visibility. Find creative ways to repay a customer for their dedication to your business and take that opportunity to make your customer feel like a VIP.

Create A Strong Customer Experience

Have an engaging and global customer service relationship. As a business, share any issues that arise with vital members of a customer service team and encourage transparency and efficiency. If an obstacle arises, find ways to implement new strategies to keep the issues from arising again, especially with the same client.

Creating a strong customer experience strategy is key to exceeding customer expectations. By clearly documenting and understanding a companywide approach to executing goals and strategies, the customer experience can be better than expected. A business owner or manager has to be in tune with the needs of the people they serve and be better than expected. Create a knowledge base for team members to utilize to better serve the client. If a business utilizes a website, sometimes it is helpful to share best practices to guide clients into a self-serve environment to save time when connecting verbally with a business. Knowledge is power.

Change Your Customer Service Strategy When Necessary

It is important to know your clientele and sometimes change your strategy to better serve your customer. As the business evolves, adapting to the shifting and constant business demands will help direct your business to your existing clients and set a standard to growing your business. Be a good listener and know that a customer will gravitate more to the feelings and solutions and sometimes a client or customer just wants to be heard and recognized. Make your customers feel important and while they may not be your only focus for the day, for that moment, they are the most important asset to you and your business.

Say Yes When You Can & Exceed Expectations

“Yes, is a powerful and trusting word. If a request is reasonable, comply if you can and stay positive. Focus on what you can do as opposed to what you cannot do and always stand by your word. Build trust with your client base. Sometimes it may be necessary to apologize. It’s easy to apologize and customers like it when they feel like they have won. As a business, being honest and forthcoming will command a greater respect than you imagine.

Always give more than expected and then give the unexpected. As a business, how can you elevate yourself above the competition. Know your customer and how to address them personally as well as how you can serve them better. Sometimes it may be necessary to build a client profile, create a more personalized experience and jot down tips to make the customer experience even stronger.

Customers have high expectations, and the customer-first approach is stronger than ever no matter the industry. Today’s customers know that they can conduct business at any time and the brands to be available at any time as well. Customer service teams have had to adapt and embrace new technology to ensure customers are getting the responses they need even after hours. Customers want convenience and speed. The demand for actions weighs more than just an acknowledgement that the feedback was received. It is important to get feedback from your customer base and welcome suggestions on how you can improve. Understand how you can use client feedback to better serve your customers and make the experience even better.

Be The Example for Your Team

More than anything, set an example for your team to follow. Employees are your internal customers and your front line. When a team is well informed and happy at what they do, they will ultimately transmit that energy to a customer. By creating a positive and solid group of team players who support the goal, a business will thrive, and a team will be willing to serve with confidence and pride.

Customer Service is a Priority at LDG Accounting

At LDG Accounting Services in Gwinnett County, customer service is always a top priority. We listen, learn, and take action for our clients. Feel free to reach out to us to learn more about what makes us so different from the typical accounting firm . Our team offers expert accounting services for all types of small businesses. Contact us today to discuss your accounting needs.

Happy People Equals a Happy Team

Thu, 15 Dec 2022 13:28:29 GMT

People, like penguins, are gregarious in nature. We tend to move and reposition ourselves where we can be heard, included, and appreciated. Have you ever been the first person in a movie theater and the next group that arrives sits down close to you? We all want to be part of a group in some manner. Job seekers aren’t any different and will often make it a point to choose a diverse and inclusive workplace. A workplace is inclusive when the employees are treated as equal and respected, and each person is given the same access to company resources and opportunities. A genuinely inclusive company will hire employees that will add value and perspective to the team by focusing on unique talents, qualities, and traits.

By fostering an environment of positive team culture, employee morale is boosted, retention rates increase, and a higher quality of talent is attracted. When employees feel that their environment is positive and uplifting, they are more likely to come forward with new ideas, and ways of contributing to the overall success of the organization. When a supportive organization puts inclusion practices in place, the standard is set for future behaviors and expectations for all employees.

Building a Better Team

A team is comprised of many components but working small and acting large often produces the best results. Smaller teams communicate more effectively and offer more creative and innovative ideas. A smaller team tends to be more results-driven and often takes more risks and in the same respect, more willing to contribute new ideas without fear of being criticized for thinking outside of the proverbial box. A solid team will develop trust and willingness to positively address mistakes and know that any failure is another opportunity to get it right. A supportive work environment will allow every team member an opportunity to contribute and the opportunity to know that their ideas will make an impact.

Another facet of building a better team is encouraging productivity without micro-management. If the team is aware of the expectations for achieving results and deadlines, they can work at a pace that will ebb and flow. In most cases, a team will be successful without incentives, but a little encouragement goes a long way. Who doesn’t like a treat on someone else’s dime? While flexible working hours are not new, after the pandemic, a more flexible working schedule became more common, and some employers found that offering non-traditional work schedules resulted in stronger productivity.

Employees like to be challenged as well. When employees become settled in their position, they become stale and sometimes unfocused. By encouraging training and new ideas, a team will become refreshed and more productive. Training also shows a team that the company believes in them enough to invest time and money to teach new tools. Once these standards are in place, a company can show the employees that they actively and supportively provide a safe and inclusive environment that is fair and promotes equality.

How Do You Keep The Pace

It is one thing to invest time in developing the best team but keeping your employees on board takes effort and communication. The expression: “a chain is only as strong as its weakest link” seems applicable. A good team also needs a good leader. Humans also tend to follow a crowd and building a strong and cohesive team is only part of the process. A good leader sets the example and others will follow. A strong leader will communicate effectively and with transparency and share a clear vision. By communicating the importance of an employee’s work efforts to the overall success of the organization, an employee will understand the importance of their contribution. An effective management process will communicate the goals and performance expectations, use objectives and measurements, offer coaching updates and feedback and identify any problems early to formulate any plan or action. Maintaining a good team takes effort and communication from all employees. At any time, a member of a team should be aware of his job performance. Performance reviews should happen frequently and offer direction. Continual coaching and training will build confidence and support with a degree of loyalty and respect.

How Do You Plan for Your Future

Escaping a toxic workplace is the second most noted reason people resign from a job and the most noted reasons people leave are often due to lack of money and opportunity. Signs of a toxic workplace include poor communication, constant turnover and lack of enthusiasm from peers, and a sense of fear. Company culture is all about how a business treats its employees. Some employees stay and do the bare minimum (quiet quitting), while other employees take advantage of the company's perks and benefits. Some employees complain of bad bosses, too much workload, lack of recognition, relationships with co-workers, lack of advancement, no clear goals, or corporate culture. Retention rates are dependent on managers and leaders developing a genuine relationship with their staff and formulating loyalty. Frequent check-ins with employees will give a measurement of the status of the overall climate of the staff. A toxic boss or a poor company culture is enough for anyone to leave and sometimes without much notice. Hiring the right person and monitoring their progress will gauge whether the new addition will be a good fit.

The Whole Package

An employee spends approximately 40 hours with the same people, doing the same type of work and sometimes the environment gets stale. Keeping the team fresh and revitalized takes effort and sometimes the great motivator of the group is not always the person in charge. Undiscovered champions of the team may leave notes of encouragement, deliver a birthday card signed by the group, and share a bowl of candy or a baked treat. Small signs of appreciation go a long way. A leader that says thank you or a peer that offers help, having an open line of communication, or supporting new ideas are a few ways of keeping everyone happy. A happy team will transmit energy to others and a positive environment is contagious.

An Organized Business Helps Reduce Stress

An organized, well-run business helps to reduce employee stress as well. Part of that is ensuring that accounting and bookkeeping are handled properly. If your small business needs assistance in this area, contact us today to learn more about our accounting services .

When to Call for Help - Accounting Service Needed!

Thu, 03 Nov 2022 13:14:11 GMT

Now that the dust has settled, and the business is moving forward, an owner or investor can find more challenges than they expect. The business may be in the initial stages of development, an established company or one that needs to be re-energized. In any case, the demand for organization is critical and sometimes it is necessary to reach out to an outside source for help.

Business owners and managers want to be profitable, control expenses and build revenue for the future. Tracking data is a key component of any business and sometimes it is very demanding to manage the day-to-day functions of the business and keep up with the flow of the financials. It is possible for an owner to keep up with the books but as the business grows and of the owner’s time, the task of managing paperwork becomes overwhelming and sometimes stressful.

Why do you need an accountant?

A business may fail to thrive when there is a lack of cash rather than a lack of profit, or when the health of a business is not clear. An accountant can help create a budget, measure, and gauge the financial viability of a business or make note of areas that need improvement. An accountant can help in preparing a plan for a business that is underperforming and suggest ways to prepare financial proposals. It is important to understand the performance indicators and why they are consistently going up and down. An accountant can also help in preparing for lean times.

Most businesses will focus on the “bottom line; however, an accountant can not only assist in understanding the bottom line but how the margins add to and take away from that bottom line. Data management and the storage of sensitive financial data is critical to the owner, investors, and the government. An accountant will make sure the proper procedures are in place for correct data entry, and the software utilized is up to date, secure and safely stored. Most importantly, an accountant will review and provide a balance sheet, profit and loss statement and regulatory compliance like audits and tax issues.

How do you find the best fit when it comes to an accountant?

When searching for the right person to manage the business operations, speaking to friends and family is always a good start. Sometimes peers, lawyers and networking groups can also provide valuable information, as well as social media. Always check references and meet informally with a list of questions and scenarios of a few issues that may have arisen. It is possible for the small business to employ a staff member to assist with the management of the business but in most cases, the needs of the business do not support a full-time person. It can be more cost effective to hire an outside source. Know the budget and be clear as to the services that you will receive. You will know when you have found the right fit.

Accounting exists to have a standardize way of measuring profitability and sustainability of a business. The daily operations of any business can be immense and sometimes frustrating however an accountant can relieve some of those stresses. An accountant will learn your business, communicate clearly, and deliver financial results directly and concisely. It is important to understand that you may be collaborating with this accountant for many years, and it is worth time and effort to hire the one that best matches your needs.

Choose the Right Accountant for Help

When choosing an accountant, be sure to choose wisely. Experience, value, communication, and trustworthiness are just some of the main factors to look for. At LDG Accounting, we offer expert bookkeeping and accounting services in Gwinnett County, Hall County, and Metro Atlanta. Contact us today to learn more about our accounting firm .

A Sensible Accounting Checklist for Small Businesses - Part 2

Tue, 25 Oct 2022 12:42:22 GMT

Today, we are going to look at part 2 of the sensible checklist for small businesses that we presented last month. This checklist will help to keep you organized regarding the financial side of your business. If you did not read part 1, click here to check it out.

Monthly Accounting Tasks

Monthly tasks fall into two categories. The first category is your “normal” end of month tasks such as balancing your checking accounts, approving payroll and other monthly tax payments, and review month end inventory. These may be the ones that almost all business owners are already doing. The second category are those that may done in a more haphazard way or not at all but are extremely important to complete monthly. First, make sure your data is backed up monthly. You might already be using a cloud-based accounting system that handles this. Secondly, review your actual profit/loss report compared to last quarters or even the same month the previous year. This may show you a clear trend for the current year as well as how well you are doing compared to the previous one.

Quarterly Accounting Tasks

Almost all of your quarterly tasks revolve around tax payments, as most states require quarterly submissions for income and sales taxes. (These can be more often, so check your state requirements!) You will also need to submit your quarterly payroll reports now as well.

One thing that is helpful to do a quarterly review of your profit and loss report. Make sure you know how much you are making and where your spending is going. With this information, you can make needed adjustments to boost profit margins.

Yearly Accounting Tasks

The year end brings the final three items on your business checklist. First if you have products, it will be time to review your entire inventory. Second, compile your full year financial reports such as profit and loss statement, cash flow statement and balance sheet. Once these are completed, have them checked for accuracy so you can then file your taxes. Finally, don’t forget to complete your IRS Forms W-2 for each employee and your 1099-MISC for any contract workers. That’s it!

Staying On Top Of Accounting Tasks Is Critical

Although extensive, this checklist will help you never miss a financial step and keep you in control of your business’ situation. Does it seem overwhelming? Want quality assistance with tracking your business’ financials? A professional accountant can help with a range of packages and options. LDG Accounting Services would happy to discuss your options. Contact us today!

A Sensible Accounting Checklist for Small Businesses - Part 1

Thu, 22 Sep 2022 14:20:48 GMT

When Should I do This?

“When have I last looked at this?” is a question every small business owner has had to ask themselves frequently. Whether you are the CEO, CFO and head of marketing, it’s easy to lose track of checking monthly reports or skipping a step in a process. Unfortunately, it takes just a few oversights with your books before you can have a real hassle on your hands. Today, we are going to look at a sensible checklist for small businesses that will keep you organized regarding the financial side of your company. Breaking it down, we start with things you should be looking at more often (at least weekly) to those that may be less frequent but can be time sensitive.

Daily Accounting Tasks

There is only one task that all accounting experts say business owners need to complete everyday: check your cash position! I normally do this as I’m finishing up my first cup of coffee because the banks make is so easy (with apps), but I actually have my balance emailed to me each day. Then consider how much are you expecting in and out today? Don’t just glance at the numbers, also look through your transactions to see if you spot any major discrepancies or surprises. It may only take 5-10 minutes but checking these numbers as you start your workday means you know exactly where your business is financially.

Depending on your type of business, you may also have to reconcile cash and receipts daily as well. You want to make sure you are not short and if there are recurring problems, figure out what is going on.

Weekly Accounting Tasks

There are more tasks that you will want to complete weekly. First, record your transactions. This can be done through accounting programs such as QuickBooks. Keeping all transactions coded correctly will help you spot unpaid invoices as well as track which products are making you the most money. Other weekly tasks include documenting/filing receipts reviewing unpaid vendor bills, check employee timesheets, and review project cash flow. The final task however is to prepare and send out your invoices. Many business owners wait until the billing cycle ends or even month end. This means that you must wait even longer for YOUR money! In addition to getting paid faster, you are more likely to catch errors and have quick responses for customers regarding issues if the transactions fresh in their minds.

Handling Accounting Tasks Is Important

Handling accounting tasks regularly in a timely manner is important. Not all small business owners have the time or support team to keep up with these necessary tasks. If you need assistance creating and maintaining accounting checklists for your business, the LDG Accounting Services would be happy to help. Contact us today to discuss your accounting needs. Here is a link to part 2 of this series.

Thanks For All The Support At Our Ribbon Cutting!

Thu, 04 Aug 2022 12:10:54 GMT

Our Ribbon Cutting Was A Success!

Thanks to all of the local community support, the LDG Accounting ribbon cutting was a success. We also were able to collect backpacks for foster children. We appreciate everyone who joined us and helped to make a positive impact on our community.

Check out some of our pictures from the event below.

Join Us for Our Ribbon Cutting!

Mon, 20 Jun 2022 12:11:06 GMT

We are so happy to announce this special event for LDG Accounting!

Join us for our Buford Business Alliance Ribbon Cutting on Wed, June 29th at 6 pm at 2910 Horizon Park Dr., Suite C, Suwanee, GA 30024. Also, please bring donations for our foster children's backpack drive.

5 More Business Metrics for Small Businesses

Thu, 09 Sep 2021 13:14:14 GMT

Last time, we looked at five key business metrics that every business should be considering for information on the health of their company. Now, we want to look at five more metrics that are more specific and revolve around tracking clients/customers and their purchases. These metrics help you focus your advertising and streamline your product line.

Customer Acquisition Cost

If you want to examine the success of your advertising strategies, the first metric you want to track is Customer Acquisition Cost (CAC). CAC tracks just how much on average you are spending to attract one new customer to your business. To determine your company’s CAC, divide your total marketing and advertising expenses by the total of new customers acquired during that same period. The lower your small business’ CAC, the lower the cost to add new customers. If you notice an increase in your costs to acquire new customers, it could be a sign that your marketing strategies are not working efficiently. When new customers enter your business, it can be helpful to ask them how or where they heard about you. This way, you can also determine CAC for different marketing avenues. For instance, you may find you are attracting customers at a much lower rate of investment through Google or Instagram. As a small business, you may already have a limited budget for advertising, so checks on your company’s CAC helps you focus those dollars for maximum return.

Although an important metric, there are a few caveats that should be mentioned. First, it is important to remember that some new customers can be organically added through positive feedback from friends or colleagues, so the rate of CAC does not represent an exact science. Additionally, calculating the cost of acquiring customers does not differentiate it between customers who spent $5 and those that spent $500. As a result, all business owners should use their customer acquisition cost metric along with others such as Customer Lifetime Value or Customer Retention Rate to get a complete idea of how well your company is doing with acquiring new customers.

Customer Retention Rate

Once you have calculated the cost to acquire a new customer, you should also look at your customer retention rate (CRR). This metric is slightly more complicated to calculate but can provide you with an immense amount of insight into how your small business is doing keeping those customers you spent marketing dollars acquiring. It is important to understand just how critical this metric can be especially for a small business. According to Salesforce, retaining existing customers costs seven times less and these customers are worth ten times as much as their original purchase! Existing customers can be more likely to try new products and they themselves are a great source for new customers.

So how do you calculate CRR? The formula tracks customer retained over a set period. You will need the number of customers at the beginning of that time period, the number of customers at the end of the period as well as the number of new customers acquired during that period. Subtract the number of new customers from the total at the end of the period. Then divide that number by the number of customers at the beginning of the period. Multiply by 100 and you have your CRR.

Confused? Here is an example. Let’s say you are looking at CRR from January 2021 to March 2021. On January 1st, you had 100 customers. During those three months, you acquired ten new customers but lost ten as well. If you subtract 10 from 100 and divide by 100, you have 0.9. Multiplied by 100, you have a CRR of 90%. This CRR would be incredibly high, depending on the type of business it can range from 20% to close to 80%.

Lead-to-Client Conversion Rate

Another customer metric you might want to consider is lead-to-client conversion rate. It might sound similar to determining your customer acquisition cost, but there is a key difference in that you are only tracking qualified leads instead of your overall marketing dollars. A qualified lead is simply a potential customer who has already expressed an interest in your product. Depending on the industry, there may be more steps in determining whether a prospective customer is considered a qualified lead. If you work in HVAC, a qualified lead may be a customer who asked for a written quote, and you physically checked out the work. Qualified leads usually require you to have already spent time assessing their needs so having a low lead-to-client conversion rate can result in a big loss of productivity. It can also point out problems in your sales strategies. Determining your L-C conversion rate is straightforward. Take the number of qualified leads that resulted in a sale and divide it by the total number of qualified leads. Multiply that number by 100 for a percentage.

Operating Margin

While the first three metrics we discussed directly measure acquiring and retaining customers, the last two will measure what they are buying and have it can affect your business decisions. The first is operating margin. Operating margin measures how much profit is made from every dollar in sales, factoring in cost of production. It doesn’t include interest or tax. Start by taking your revenue and subtract the cost of goods, wages, and other direct costs. Then, divide that number by your revenue. Multiply by 100 and you have your operating margin. This can get confusing so let’s look at an example.

If your company has revenue of $1,000,000 has a cost of goods sold at $250,000 and administrative costs (wages, rent, etc.) at $300,000, your company’s operating income is $450,000. Dividing that by the original revenue gives you 0.45. That means that your operating margin is 45%. The higher the percentage, the more profit your company is generating through sales.

Margins Per Product Line

Once you have evaluated your company’s operating margin you can also examine your margin per product. This can tell you which products make you the most profit per sale. It is calculated the same way as your operating margin, but this time you will only use the numbers for a particular product or service your company provides. For instance, if you are a lawn care business, you might look at your revenue from lawn trimmings. After factoring in costs such as gasoline, oil, and wages, you may find that it has a higher margin than more time-consuming services. It is important to remember that calculating margins per product line may not factor in large overhead costs such as equipment. These initial costs should also be factored into your decisions since you will need to spend capital initially just to begin generating revenue no matter how high the margins are.

Embrace The Benefits of Understanding Your Small Business Metrics

These five metrics may not be necessary for every small business but tracking them can provide important insights into how potential customers respond to your business, how existing customers interact with your company and how your product line is affecting your bottom line. One important thing to remember is to never rely on just one of these metrics. An overly positive customer retention rate may hint that your business is going to be successful, but if attracting new customers has been cost-prohibitive and you are currently operating as a loss, you may not be around long enough for your customers to return! Together, however, metrics can advise you on your next steps.

Want assistance tracking and reporting these metrics? A professional accountant can help with a range of packages and options for your small business. LDG Accounting Services would be happy to discuss your options . Contact us today!

Business Metrics for Small Businesses

Wed, 11 Aug 2021 13:16:09 GMT

In today's business climate, advisors and investors alike constantly bombard businesses with "buzz words," terms that you are told you must know and understand to be successful. Many of these are business metrics, designed to better quantify just how well a business is doing. Today, there are dozens of them. A quick Google search found one article that highlighted 64 metrics you should be tracking! You may have heard of many typical business terms without fully understanding them. Today, we will look at five of the most important terms, why they are important to you as a small business owner, and how you can use them to monitor and grow your business.

Revenue

The first metric we will look at is revenue. Revenue is simply the amount of money a business receives in sales of products or services. Often referred to as sales or top-line income it measures total money before any expenses are paid out. There are two ways to count revenue. If you are using the cash accounting system, (most small businesses do) revenue only counts money received in your bank account or held in cash. If you use accrual accounting, any sales where the customer has agreed to pay but has not done so would be counted. Tracking revenue over a period of time may be straightforward but it can be important to look at different lengths of time to identify any shifts in revenue at different times of the year. Understanding where and when revenue is generating can help you target new advertising campaigns or plan ahead for leaner weeks or months.

Expenses

On the opposite end to revenue are expenses. Expenses are all the costs associated with your business. Examples of expenses can include equipment, labor, supplies, dues, and interest. As with revenue, accrual accounting counts expenses before you have actually paid them, while cash accounting would not until you pay the invoice. Expenses are further divided into two main categories. The first is operating expenses which are those that are the direct result of your business running. These can include the cost of supplies, rent or mortgage on your building, and the cost of paying employees. Nonoperating costs are indirect and can include interest, lending fees, and depreciation. Like revenue, tracking expenses can seem simple. It is more important to examine expenses looking for waste. Notice that transaction fees for your credit card company are higher than expected? Maybe you are not utilizing a subscription you pay for? A close examination of expenses can save in the long run and increase efficiency.

Cash Flow

A third key metric to examine is cash flow. Cash flow measures the money that is moving in and out of your bank accounts over a given time. It is quite simple to calculate: Cash received – Cash Paid out = Cash flow. If you receive $8,000 in sales and pay out $7,000 in bills in a single month, then your cash flow would be $1,000. This might sound exactly like the definition of profit, but there is a significant difference. Profits utilize accounts payable and receivable, which track transactions, some of which may not have cleared. As a result, your profit/loss report may tell you that you have healthy profits, and your business is doing well. If you check the bank account, however, you could be in the red. Tracking cash flow allows you to see just how much money is available and can advise you on spending trends within your company. If you do not take the time to track cash flow you can easily end up with a slew of bank fees with limited options. Long-term cash flow problems can doom a business. So how can you improve your cash flow? One of the best ways is to collect your accounts receivable as soon as possible and track late invoices. You can also improve your cash flow by not paying accounts payable earlier than necessary as well as limiting inventory purchases. Tracking cash flow over time can show you if there are trends throughout the year, allowing you to plan for negative cash flow events that could hamper your business.

Overhead Costs

A 4th key metric to track is overhead costs. These are expenses that are directly related to the day-to-day running of your company. Although it is important to understand your overhead costs as a general rule, if you are experiencing troubles with cash flow, reducing these expenses may be your only option. Knowing your overhead costs can also help you easily locate better prices on many of these expenses.

What are a business' normal overhead costs? The largest is usually rent (or mortgage). A close second is administrative costs such as wages and benefits. Utilities (electricity, gas, water, phone, and internet) often form the third largest overhead cost. Insurance costs can also be substantial and include your general liability, unemployment insurance, and medical coverage if offered.

Those are the most associated overhead costs, but anything that does not change with sales numbers should be categorized as an overhead expense. This can include maintenance and repairs of machinery, vehicles, and tools. It can also include much of your sales and marketing budget. Lastly, any subscriptions or professional fees can fall into this category as well.

Inventory

If your business sells physical products, then a fifth key metric you will want to track is inventory. Using this metric, you can fine-tune your supply chain so you have enough product on hand to meet customer demand, without sitting on inventory that can cost your business in more ways than one.

There is no single way of tracking inventory and you will need to track it long enough for trends to appear before you are getting the full value out of this metric. Here are a few things you can look for: What was your total sales volume for a particular product in the last month? What about the last year? Did sales increase over that time? You also want to look for any seasonal upticks that you should require you to purchase additional inventory. Third, look for any disruptions in your supply chain. Did you run out of a product at all in the last year? This can bring you to look at internal lead times from suppliers.

While customer demand should be tracked so you can keep enough inventory to meet demand, you should evaluate your suppliers in the same way. Some key questions: Has inventory been delivered on time? If so, were these shipping delays or caused by problems at the supplier? Has all inventory ordered arrived in good condition and easy to unpack and make purchase ready?

All of these points are even more important if your business has products with a limited shelf life such as restaurants, pet shops, or cosmetics. Once you can establish solid lead times, you will be better able to cut down on waste and avoid running out of products with customers waiting to buy them.

Metrics are Important but NOT Everything!

Understanding and tracking these five metrics is a great way to understand where your small business has been, where it currently is, and where it is headed. One important caveat is to never rely on just one of these metrics. An overly positive customer retention rate may hint that your business is going to be successful, but if attracting new customers has been cost prohibitive and you are currently operating as a loss, you may not be around long enough for your customers to return! Together, however, metrics can advise you on your next steps.

Why Your Church Should Outsource Their Accounting Services

Thu, 08 Jul 2021 13:27:33 GMT

Have you been considering your church’s accounting options?

The words ministry and accounting can seem like a bit of a paradox. As a not-for-profit organization, churches often think of financials as that which we, “render unto Caesar,” rather than a part of ministry. However, it is critical for all churches and ministries to have a solid handle on their financials. Without it, questions like, “Do we have enough money for this program?” quickly become murky. For many churches in this financial climate, hiring another staff member to handle bookkeeping is not feasible, but there is another solution. Consider outsourcing your accounting to an experienced accountant. Bookkeeping can be overwhelming and having a professional on your team can save you time, money, and stress in the long run, Not sure? Here are ten reasons why every church should look at outsourcing their accounting.

Skills and Experience

Hiring an accountant means you get a professional whose experience is now working to help build your ministry. They can ensure you are following best practices and can answer complicated questions. You will also have an unbiased opinion to rely on. It is easy for internal bookkeepers and others on staff to be emotionally invested. With an outside accountant, you are getting an expert who can provide objective analysis, years of financial experience, and peace of mind to your ministry.

Accounting Accuracy

Whether you are a local congregation or a multi-campus ministry, every dollar given has been entrusted to you. You must make sure you are keeping accurate and up-to-date records that follow generally accepted accounting principles (GAAP). With an accountant, you are less likely to miss deadlines or make mistakes.

Save Time

Every church leader wishes they had more time in the day. Do not spend valuable hours worrying about tracking finances. An outsourced bookkeeper means you can focus on what you are called for, the day-to-day work of ministry!

Save Money

Many churches simply cannot afford to have a full or even part-time bookkeeper on staff. This could lead to a staff member juggling multiple roles without the necessary expertise or the understanding of church financials. Hiring an accountant gives you a higher quality of work at an affordable price, with packages designed to fit your church’s exact needs.

Improve Financial Processes

Hiring an accountant also allows you to improve your financial process. All churches need regular financial statements, but accountants can generate a variety of reports, tracking purchases, sales, payroll, assets, liabilities, and any other transactions you have in your church. A professional will also bring their online tools to your ministry, allowing you to be included in the process and be able to check on financials 24/7.

Protect Church Assets

Church assets can vary from physical property to designated funds, but all of them need careful monitoring. You need to be able to make sure you have money to pay rent or mortgage (as well as other expenses) and ensure that any ministry giving that is earmarked for a specific purpose is allocated correctly and tracked.

Consistency

Having a dedicated accountant working with your church means you will not have to worry if your church treasurer or volunteers retire or move. While waiting to find a new bookkeeper or train volunteers, costly mistakes can pile up. Make sure your ministry has stability so you don’t have gaps in knowing where you are financially.

Compliance and Tax Liabilities

Churches and ministries may operate as tax-exempt entities, but that does not preclude them from a variety of issues that accountants handle. Payroll taxes, workers’ compensation, and excess benefit transactions all require careful attention. An outsourced accountant will help you prepare for tax season and make sure your tax returns do not lead to a costly tax penalty or IRS audit.

Secure Church Grants and/or Loans

Many donors want to make sure that they are donating to a reputable organization. At the same time, if your church is looking for a loan to expand, you will be required to have Financial Statements. Make sure your ministry is ready to grow with professionally prepared Financial Statements. An accountant’s expertise may not only be required, it can help your church be more attractive to potential lenders.

Internal Controls

Perhaps one of the most important reasons for a church to consider external accounting help is stewardship. An accountant is not only a second set of eyes checking for mistakes, but they can also prevent willful fraud. This is of course a sensitive topic. No one believes that their ministry would ever have such an issue. Churches, however, are a unique target for fraud since there is a high degree of trust. A professional accountant will show that you are protecting your members’ contributions. Transparent processes will also help protect staff from false allegations.

Choose the Right Church Accountant

No two churches are the same, but there is a compelling reason for each of them to consider outsourcing their accounting to a trusted, experienced church accountant. Whether it is letting you focus on your ministry, helping your ministry grow, or providing protection from fraud, adding an accountant to your team makes your job easier and less stressful.

Want more information including packages and options for your church ? LDG Accounting Services would be happy to discuss your options. Contact us today.

7 Reasons for Restaurants to Outsource Their Bookkeeping

Wed, 09 Jun 2021 13:22:32 GMT

Whether you have already been a restaurant operator for a while, just opened recently, or simply thinking about opening your dream spot, you have probably heard the phrase, “Restaurants are risky.” A quick online search lists multiple articles that report 60% of new restaurants close within a year of opening and 80% by five years. While each article lists a myriad of reasons why restaurants fail, one of the overarching themes is money management. Whether it is a lack of experience handling finances to outright theft, failure to closely track income and expenses can sink a restaurant quickly. Most new restaurants simply don’t have the income to pay for in-house accounting and most owners are experts at creating their dishes, not accounting. The easiest and most practical way to put your restaurant’s financial books on the right path is to outsource your bookkeeping to a professional company. Many accounting firms offer a variety of services for a fraction of what it would cost to hire in-house and it can save valuable hours each month. Not convinced? Here are seven reasons why every restaurant should consider outsourcing their bookkeeping.

1. Accounting Expertise

Having a professional accountant working with your business means that you are benefiting from their years of training and experience. Not only will they be able to provide solid financial analysis, but some accountants specialize in helping restaurants and can offer more specific financial info for your business. An experienced accountant will not just be able to organize your books but will be a partner in helping your business succeed.

2. Saves Time

A professional accountant will also save you and your business hours each week. This time savings comes in three ways. First, you as the owner may take longer to do your own books each week than a professional, costing you hours you could spend focusing on your menu, staff, and everything else you must worry about! Second, most also use digital tools so it is easy to upload invoices and receipts, meaning less time tracking down documents when you need them. Third, with accurate books and professional guidance, you will make better decisions moving forward that will save you even more time and energy.

3. Detailed Reporting

When you outsource your bookkeeping, you are not just getting an expert. You are also benefiting from the online tools many accountants use. These can provide you with detailed reports, accessible 24/7. Whether it is a profit & loss report, balance sheets, or cash flow history, these reports help you make better decisions moving forward with your restaurant. They are also very useful when talking to investors or a bank. When speaking with an accountant, ask about these options so that you can take advantage of all of the tools a professional accountant brings to your business.

4. Make Tax Season Easier

Although your bookkeeper won’t be able to do tax preparation, they keep the detailed records you will need when it's time to file. When tax season arrives, you will not need to scramble to get your numbers in order. Your bookkeeper would have also been following Generally Accepted Accounting Principles (GAAP), which means there will be fewer if any surprises at tax time.

5. Avoid Fraud

Unfortunately, fraud is a worry for all business owners, but especially in the food industry with many restaurants being cash-heavy establishments. Add in the need to track tips and the possibilities for financial irregularities increase. A professional bookkeeper not only knows all of the regulations but offers an unbiased eye to look for fraud risks and bring them to your attention. When every dollar counts, do not let trackable fraud stunt your restaurant’s growth.

6. Potential Growth

Outsourcing your books is never a one-size-fits-all. Most accountants offer various packages and options. This means as your restaurant becomes more successful and grows, your accounting can scale with the growth. The last thing you need is to train a new employee to handle the books while you are going through a busy growth period. You will also not need to worry about bringing in a new employee who is not familiar with your business. Lastly, your accountant may provide helpful information that will assist you in how to keep that growth happening.

7. Payroll Headaches

Payroll is so often a hassle for any business. With multiple taxes and deductions, it is another issue for you as a restaurant owner to handle. Although accountants do not have to handle payroll, many can help you find a payroll company that will work seamlessly with your accounting software. With payroll being outsourced and double-checked by your accountant, you are losing one of your potential biggest headaches while saving you even more time.

Learn More About Our Accounting Packages

No matter the restaurant, there is a compelling reason for each of them to consider outsourcing their accounting to a trusted, experienced accountant. Save time and money, streamline info and processes, and have a second set of eyes watch for fraud and waste.

Want more information including packages and options for your restaurant? LDG Accounting Services would be happy to discuss your options. Contact us today.

We Honor & Thank You This Memorial Day

Fri, 28 May 2021 13:52:45 GMT

The entire LDG Accounting team wishes everyone a wonderful Memorial Day weekend. During our celebrations, we should all take the time to honor, remember, and thank those who served and sacrificed so much for our freedom. Our appreciation for the freedoms we enjoy due to the sacrifice of others go beyond words. THANK YOU!

“May we never forget freedom isn’t free.”

- Unknown

5 Reasons for Nonprofits to Outsource Their Accounting

Wed, 31 Mar 2021 11:10:45 GMT

Bookkeeping is not a buzzword that many business owners are excited to talk about. Although crucial to the operation of your company, many owners have a basic understanding of accounting principles but no time to learn more while opening their business. This situation is compounded if the business is a nonprofit organization. Managing donations, ensuring that money is allocated correctly and managing the day-to-day operations can quickly lead to an untenable position for any owner. Like all businesses, nonprofits have a solution: outsourcing their accounting to an experienced accountant. Today, we will look at five key reasons why every nonprofit organization should consider outsourcing their books.

Accuracy

One of the main advantages that a non-profit organization gains from outsourcing is accuracy. First, you will know your financials are maintained by someone following generally accepted accounting principles (GAAP). Often, non-profits employ a part-time accountant or roll it into other responsibilities of a full-time employee. This could lead to situations where if you need to apply for a loan or are being audited, the financials will be in disarray. Outsourcing your books means far fewer mistakes in general.

Additionally, with a professional accountant, accuracy means you will not miss important deadlines, donations will be correctly categorized and up to date. Many non-profits have multiple projects or even offices, so keeping donations and designated funds organized can be a hassle. A trained, experienced accountant will make sure that when you access your financials, you have balanced and clear reports.

Advice & Experience

Another key advantage of outsourcing your accounting is the experience and advice you will obtain. By hiring an experienced accountant, you know your books are being handled by someone who has managed financials for similar companies. Choosing an accountant who specializes in nonprofits will also provide more specific financial information for your business. They can provide a non-biased opinion on critical financial issues. An experienced accountant will not just be able to organize your books but will be an objective partner in helping your nonprofit succeed.

Experienced accountants also bring with them tools such as accounting software that allows you to stay connected to your books 24/7. With a click of a button, you can access a variety of reports such as profit & loss, balance sheets, and outstanding invoices. An experienced accountant will be able to walk you through how to access these tools so that you are always aware of where your nonprofit is financially.

Time & Resources

Outsourcing your financials also saves nonprofits significant time and resources. As the head of your nonprofit, time spent working on the books is time that could be better spent growing your donor base and reaching more people. Your accountant will save you hours weekly. Meetings with your accountant will highlight key trends and issues that will allow you to make better decisions moving forward.

Your nonprofit will also save valuable resources when you outsource. Most nonprofits cannot afford to hire a full-time in-house accountant. Meanwhile, hiring someone part-time or having another employee juggle multiple roles wastes time and can lead to mistakes. By outsourcing, you are avoiding both issues while maintaining peace of mind that you are books are being handled correctly.

Consistency

Having a dedicated accountant working with your nonprofit means you will not have to worry if your employees come and go. Make sure your company has stability so you won’t have gaps in knowing where you are financially. If that person moves on from the company, you will now have to train someone from scratch who has no knowledge of the financials. An experienced accountant will not only be able to get up to speed quickly when they begin working with you, but can be a partnership that lasts for years, saving you training and hiring costs.

Fraud & Risk Prevention

Lastly, an experienced accountant can help prevent fraud and lower other financial risks from affecting your nonprofit. The news is filled with stories of misused funds from charities and other 501c3 groups. With a high degree of trust, many nonprofits are targets for scammers. Your accountant will not just track income and expenses and look out for irregularities, but they can also identify when donations have been misallocated. This ensures that rent or mortgage (as well as other expenses) are covered, as well funds set aside for growth. A professional accountant will also show that you are protecting your donors’ contributions and help protect staff from false allegations. This transparency can assist in acquiring more donations as well as business loans.

Choose An Experienced Accountant for Your Nonprofit

Whether you are a brand-new nonprofit organization wanting to start out on the right path financially, or a growing organization that wants to avoid bookkeeping pitfalls, there is a compelling reason for each of them to consider outsourcing their accounting to a trusted, experienced accountant .

Want more information including packages and options for your church? LDG Accounting Services would be happy to discuss your options. Contact us today.

Starting a New Business? The Important Steps To Take - Part 3

Tue, 09 Mar 2021 15:30:02 GMT

Step Five: Setting Up Taxes and Employee Insurance

Welcome back as we wrap up our business startup series. It’s been your goal to open your own business. You have done the groundwork and the business is getting close to the grand opening. Before you make your first dollar and pay your first employee, you will need to get your tax withholdings and employee insurance in place. One caveat: there is simply no way to cover all of the information you will need for your business in this article. What we will cover are the main points and requirements for all businesses.

Federal Taxes

The first set of taxes to consider are federal taxes. These consist of income, social security, Medicare, and if applicable, excise taxes. The good news here is that most small businesses pay no specific federal business tax. If you are a sole proprietorship, partnership, or LLC, all federal taxes are simply passed to the owner via their personal tax return. If you happen to have a corporation, you will have to pay the flat corporate tax rate of 21% (at the time of this writing). Excise taxes are levied against a particular good or service. Many goods and services including gasoline, alcohol and indoor tanning are subject to these so it is important to check to make sure you are not liable for any of those as well.

State & Local Taxes

If your business will be selling a product, you will also need to collect and pay sales tax. To begin, in Georgia, register with the Georgia Tax Center and apply for a Georgia Sales and Use Tax Number. Sales tax returns are completed monthly and are paid electronically in most cases. There are several aspects of sales tax that new business owners should be aware of. First, sales tax is determined by the location where the customer receives the product. That means if your business is based in Gwinnett County, but sends their product to Fulton County, you will need to charge the higher sales tax in Fulton on the invoice. Second, while many services are exempt from sales tax, you should check to make sure all of your services fall into that category. Some services such as hotels, transportation, and entertainment such as games and amusements are taxable in Georgia. Lastly, Georgia charges a “use tax.” If you bring property or equipment into Georgia, you may have to pay a use tax if you use it for your business. It is paid at the same time as normal sales tax.

Another state and local tax your business needs to be prepared for is payroll taxes. First, you will need to register your new business with the state and apply for Withholding Tax Payroll Number. How often you will have to remit them to the state varies depending on how much your company makes. Businesses that withhold over $50,000 in taxes during their “lookback period” of July 1-June 30 will have to send payment electronically after each paycheck distribution. Otherwise, it will normally be a monthly payment. For more specific info, check out the GA Department of Revenue’s Employer’s Tax Guide: https://dor.georgia.gov/employers-tax-guide

Unemployment Insurance

In addition to these, most businesses in Georgia will need to pay an unemployment insurance (UI) tax. You will start by registering your new business with the Georgia Department of Labor. The GDOL will confirm if you are liable to offer UI to your employees. Currently, the UI tax rate is just 2.7%. The two most common mistakes that new companies make is failing to post the required notice (in a place where employees can regularly see it) and misclassifying employees as independent contractors. The latter can lead to penalties and fines, so be honest with your employee designations.

The final consideration is worker’s compensation insurance. In Georgia, if you regularly employee three or more people (full or part-time), you are required to provide workers’ compensation insurance. The state of Georgia does not offer this insurance directly so look at adding it to an existing policy.

All of this can be overwhelming especially as you start a new business. The good news is that as we saw in our previous article , there are plenty of payroll companies that can handle the task of setting aside tax obligations for you and your employees. Please note that you may still be liable for errors even if they are made by an outside company so it is still important to look over payroll to confirm accuracy.

Step Six: Startup Advertising

Before you officially open for business, you should make sure your potential customers can find you as well as learn about the products and services you offer. This used to be exclusively the realm of print advertising such as billboards and magazines. Although still viable options for many businesses, there are far more ways to advertise your business today. The key is to utilize them properly.

Business Website

The most common way for businesses to advertise is through their website. Gone are the days where only computer science majors can make professional-looking websites. There are many low cost DIY options available for small businesses or better yet, some very good other small business owners that do just this very thing inexpensively. Just because you can do it yourself, doesn’t mean that it's always your best option. Web designers can greatly assist with setting up a site complete with plenty of engaging graphics and are often easier to maintain. This is important as you always want to update your site with the latest products and prices. Make sure your website is user-friendly and your contact info displayed prominently. Lastly, you may choose to take orders and payments from the web, but make sure your billing system is readily compatible. ( Back in Step 3 )

Social Media

Your website is a great way to get connected with potential customers, but make sure you pair that with a robust presence on social media. There are many options out there, but make sure you focus on the sites where your targeted customer base spends their time. A Facebook page is the minimum requirement, with over a billion users worldwide. Also consider an Instagram page, especially if you can take professional images of your products or if your customer demographic skews younger. Other options to consider include Twitter, Pinterest and a YouTube channel. All your social media pages should link to your website as well as with clear links from your site to your social media. You can also consider paid advertisements on many of these sites which will reach users who have interests connected to your business. This can be one of the most cost-effective ways to specifically target potential customers.

Customer Reviews

The third way you can advertise for your new business is through the various companies that review products and services. Google Reviews is the most well-known. Your startup’s reviews will forever be connected to its Google Search, so make sure to encourage happy customers to leave a review and respond to negative ones quickly and professionally. If you are lucky, fixing the problem can lead to the person deleting it. There are other review options to consider as well depending on what your product or service you are offering. Angie’s List posts reviews and connects customers to home improvement and repair companies. If your business is in the hospitality industry, consider a TripAdvisor page.

Local Events

A fourth option for advertising your business is through local events and festivals. Held throughout the year especially in cities and suburbs, these gatherings are not only a great way to meet customers, but simply have large numbers of people see your name and brand. You also don’t need to sell products at these events, as many strictly serviced based businesses attend as well. One caveat to mention here is to wait until your business is up and running before advertising at these events.

Business Associations

The last method of advertising we will discuss is through business associations. Although joining one is beneficial for a multitude of reasons, these groups of businesses connect you to your community faster. In addition to internal referrals, many associations try to recommend your business to their own clients as well. With a low cost to join, business associations can add another accessible option for new startups to advertise.

Get Started The Right Way

The modern startup has far more affordable and targeted advertising options. The most important thing to keep in mind is utilize them correctly and don’t add options that won’t be maintained or target the right audiences. With a multi-faceted approach, you can reach millions of potential customers before you even make it to the grand opening. Opening a new business? We can help! Contact us today and let our twenty years in the accounting industry help your new company start off on the right path

Starting a New Business? The Important Steps To Take - Part 2

Thu, 03 Dec 2020 17:07:21 GMT

Step Three: Determining your Accounting System

If your dream is to open your own business, it may seem like a mountain of tasks and decisions before you even get to the grand opening. The key is to break this list into manageable goals. As we saw last time, you want to start by evaluating your financial and market viability, followed by developing a business timeline. Today we will discuss the next two steps, deciding on the accounting system and determining your fiscal year end date.

Accrual or Cash System

The first step in determining your accounting system is deciding whether to utilize an accrual or cash system. Both are used to track your revenue and expenses and offer your business several advantages and disadvantages. Accrual accounting counts revenue and expenses when they are earned or spent, not when the money actually changes bank accounts. For example, a customer purchases your product for $100 on 10/28 and you receive the funds in your account four days later on 11/1. Accrual accounting records it as revenue in October, even though you don’t have access to that money yet. The same principle applies to expenses. Although the accrual system is more complicated, it shows a more accurate view of the company’s overall profitability as it tracks all accounts receivable and payable. The main drawback to this system is that you have to keep tabs on your bank account balance. If not, you may have significant revenue in the system, but the bank account could be in the negative.

The second method of tracking your business finances is cash basis accounting. With this method, revenue and expenses are recorded only once money has changed hands. With the previous example, that $100 from 10/28 would be considered November revenue since it posted 11/1. The cash basis method is simpler and ensures that you always know how much cash you have on hand. At the same time, this method may create long-term headaches if you don’t plan for scheduled accounts payable in the future. This can be far more important if your business will have dramatic seasonal shifts in revenue. If the bulk of your revenue is derived from summer vacation spending, your profits would be even more concentrated than under the accrual method.

Both methods provide a partial financial view of your company, but require you as the owner to keep a close lookout for potential problems, whether it be in the short term cash flow issues with the accrual system or more drawn out concerns with tracking when revenue is actually earned. One final point to consider is the future growth of your business.

Determine Your Fiscal Year End Date

While choosing your accounting system affects day to day operations, another important task is to determine your Fiscal Year end date. It should be noted that most small businesses have no choice and have to use the calendar year date of December 31st. This is especially true if your business is a sole proprietorship and most LLCs. If you can change your fiscal year date, you should consider whether doing so will actually benefit your company. You might want the end of your fiscal year to coincide with the end of your business’ busy period. If a significant amount of your revenue is during the summer, a year end date around September 30th may be better. If you decide to change, do know you will need IRS approval.

Step Four: Small Business Software Options

Last time, we looked at determining your accounting system and the end date for your fiscal year. Once you have made these decisions, you can now consider software and external help for your startup. You will need to choose these for a bill pay system, point of sale (POS) system and payroll. There are more than a handful of excellent options for each of these and the purpose of this blog is not to recommend one over another. Instead start by going through potential sale points, vendor locations and estimated number of employees. (You may have already done this part of your earlier startup plans.) Then, research your options to see which one best fits your business and where it will be headed in the future.

Pay Suppliers

First, consider how you will pay suppliers. There are many bill pay systems on the market today but not all are configured for every business. Some charge by the transaction, which can be cost-effective for startups. Others have flat monthly fees, so if you know you are going to have a large number of individual transactions, it may be beneficial to choose this option. You should also consider if you will be sending payments overseas, as some options do not have international bill pay.

Processing Payments

While some bill pay systems offer POS features, today’s mobile culture requires business owners to make sure they can also take payments on the go. Some factors to consider are cost (initial setup plus monthly fees) whether you want to use it with different applications, mobility, and required equipment. If you plan to accept payments at events and want to use a mobile device, check that the POS system is compatible, especially if it's an iPad. One word of caution here. Many credit card processors will offer “free” equipment in exchange for you signing a long-term contract. These are usually not beneficial for a startup as you usually end up paying up to 4 times the value of the equipment in the long run.

Payroll

The third piece of the software puzzle is payroll. As you will learn tax withholdings can be a nightmare. Choose a payroll provider that can handle everything. Direct deposit, tax payments, and year end filings. Many can create customizable reports and even send the insurance company their monthly premiums. As with bill pay and POS, make sure you are choosing an option that checks off all of your needs.

Choose Accounting Software Wisely

Tying all these parts together is your accounting software. Accounting software replaces a stack of spreadsheets and paperwork, plus hours of your time with accurate reports on accounts receivable and payable, profitability analysis and tax prep documents. There is accounting software for every size business and each offers a range of packages. Make sure to do your research, as some programs are built for specific businesses such as micros or service-based startups.

Like so many steps in starting your own business, take the time to look over your needs before choosing software. Many companies offer great introductory deals and it's easy to upgrade features and packages as your business grows. If all of this accounting jargon seems overwhelming, let us help! Reach out to us today.

Starting a New Business? The Important Steps To Take

Tue, 20 Oct 2020 13:31:17 GMT

Step One: Determining Viability

So, you want to start a business? Congratulations on entering the world of entrepreneurship! If you are considering starting your own business, it can be difficult to know where to start. The good news is that no matter the industry or market, a few simple steps can get you headed in the right direction.

The most important step starting out is to evaluate the viability of your new business. There are three aspects to consider with viability:

Financial startup cost
Earning potential
Entry market

Financial Startup Cost

The financial startup costs require several tasks. First, determine what the initial costs would be to begin operating. This can be the cost of equipment, deposits, or other necessary expenditures. It should include your initial marketing budget as well. You will also use this information if you choose to take out a business loan.

Earning Potential

Second, create a budget for your startup. Determine how much revenue needs to be generated to break even as well as potential costs that could come up regularly down the road. Don’t ignore paying yourself. There is no reason to start a business if you won’t be able to pay yourself.

Entry Market

Third, check the current economic climate or mood. If tourism numbers are down in your city, opening a tour company may not be viable at that time. Check spending data to ensure that you will be able to generate sufficient revenue when you open. If the data is not positive, evaluate if conditions may be getting more favorable in the future. You can also consider ways to alter your products and services to better match current and future demand.

While considering the financials, you should also evaluate the market your business will be entering. What products or services will you be offering? Who will be your customer base? Once you know, is your business near these potential customers?

Also, consider your competition. Do many other businesses offer a similar product? Will your products be sufficiently different or will there be enough demand when your business is launched?

Although it might seem superficial, consider whether this type of business is in your skill set. Do you have the necessary training and time to succeed? Some may take a hobby they enjoy but end up realizing they cannot scale up or enjoy it at the business level.

Once you go through these steps, you will have a much clearer idea the challenges you will face. Read more to learn about step 2.

Step Two: Develop Timelines and Milestones

For years you have considered starting your own business. Now you are ready to turn those dreams into reality. Once you have evaluated your financial and market viability, (see step 1 here link goes here) go ahead and create a basic timeline for your startup. Set specific tasks based upon your viability analysis but be prepared for them to change as well.

Start with your finished goals on your timeline. What viability research did you complete? What previous connections with suppliers or potential customers have you already made? Have you already applied for patents or developed prototypes for products? These completed milestones help show potential investors and clients that you have taken significant steps towards launching the business.

Then move onto creating specific milestones in your timeline. Give each milestone an end date, but some may require a start date as well if they will take a specified amount of time. Also consider what milestones have prerequisites or need to be completed concurrently. You don’t want your project held up even later because one late milestone pushed back others. The last milestone for this timeline will be the opening of your business.

Although there are many possible milestones to consider here are some of the most notable:
Apply for any trademarks and/or patents
Select a name and legal structure
Register name with the State of Georgia
Obtain a Federal Tax ID number
Open a business bank account
Write a formal business plan
Register for a domain name (to be used later)
Decide on where the business will take place (home office, warehouse, office)
Rent office space (if required)
Obtain licenses and permits needed for the industry you are in
Obtain the proper insurances
Hire employees (if necessary)

Many of these are straightforward steps, but let’s break a few of them down further.

Apply for Any Trademarks and/or Patents

When it comes to trademarks and patents, be prepared to apply early on. According to the US Patent and Trademark Office, it can take 16-23 months to secure your patent depending on the type of patent needed and questions the patent examiner might have. If your business requires it, make sure it’s done before you open, as patents cannot be obtained once the invention has been publicly disclosed. There is also a cost ranging from a few hundred to about a thousand dollars for the patent application and associated fees.

Select a Name & Legal Structure

Although choosing your business structure is relatively simple to set up, make sure you do your research ahead of time. Figure out which structure best fits your business both at startup but also down the road. Although it may be possible to change later on, this is not always available depending on your location. There can also be tax issues and even result in the dissolution of your business. When naming your business, make sure that it is easily recognizable and memorable, professional, as well as connected to the good or service that you will be providing.

Write a Formal Business Plan

You may be tempted to believe that you already have most of your business plan together with this timeline, but business plans include much more than start-up goals. Whether it is a twenty page traditional plan or a lean startup plan that just contains key elements, a business plan helps you focus your startup’s purpose, attract investors or secure a loan, as well as encourage others to come work for you. The main components of a successful business plan include your company description, market analysis, product line, marketing strategy, and financial projections. Do not forget an executive summary, where you can detail why investors should choose your business.

Obtain the Licenses and Permits Needed for Your Industry

Although most businesses will only need state or local permitting and licensing, you may need to apply for Federal permits depending on the industry you are entering, such as agriculture, aviation, and maritime transport. You may also need to file with the Federal government if you need tax-exempt status as a non-profit or if you are creating an S-corp.

Obtain Proper Insurances

When purchasing insurance, you will need a general liability policy that covers most cases involving loss or damages. You might also consider an umbrella policy that not only covers additional circumstances, but also can respond in cases where your general liability policy is exhausted.

Hire Employees (if necessary)

If you choose to hire employees, make sure you have time to find the right candidates and adequately train them for your business’ launch date. This may seem straightforward, but you want all of your employees to be ready to make a good first impression on your new clients.

Open Your Business

The last milestone for the timeline will be the formal opening of your business. Make sure you give yourself ample time to complete all previous milestones. When considering your opening date, look to see if there is a particular time of that month or even year that will help get your business started on the right foot. For instance, a business that caters to children and families might want to open late spring or early summer to take advantage of families out of school.

There are a few more key milestones in starting your business, but they will be covered in greater detail in the next article. Check back next week as we discuss setting up an accounting system and setting up tax paperwork.

Strategies for Our Current Business Climate

Wed, 15 Apr 2020 14:06:23 GMT

Strategies for Our Current Business Climate

This is the second in a series of strategies to use in the current climate. Today we focus on knowing and managing your numbers.

KNOW YOUR NUMBERS

Now more than ever it’s vital that you know the relevant numbers that form the life blood of your business.

Read your financial reports, understand them, and do your cash flow forecasting as well so you can pre-empt what cash impacted maybe in the next month or two.

If you don’t have the following already, request these from us and we’ll prepare as soon as possible:

Actual P&L weekly and monthly and quarterly
Actual P&L Year to Date
Balance Sheet

REVIEW AND CUTTING COSTS

Reviewing and cutting costs definitely is a number-one priority. It's probably good practice anyway to review your costs on a regular basis. So what you would do is get your profit and loss statement and just go through all of the lines and work out whether or not some of those

have blown out or if you haven't addressed those recently. There may be mobile phones that are hanging around that you no longer need. You may need to go back to your insurance broker and get quotes, energy suppliers, all of those sorts of things so definitely do that.

If you do need to cut things, try not to cut expenses that are helping you to grow or to be more efficient. If you do stop spending money on things that are helping you grow and generating leads it's going to be hard to come back later.

Review and redirect your marketing. There are ways to relook how much you're spending on marketing whether it's effective or not. If you don't know what's working and what's not in marketing, know your numbers around that like what sort of return you're getting from different marketing channels or different marketing tactics and really understand which ones are paying for themselves and which ones aren’t. Continue to monitor it over time.

If you're doing Google AdWords for example and you know it's been working in the past just monitor it going forward and see if there is a drop-off and whether you can refine the messaging. Relook at tapping into more about the concerns of people having out there.

Look at your personal expenses as well. It's not just about your business expenses you may need to trim back on but your personal expenses and lifestyle as well.

STAFF CUTS AND CHANGES

Look at staff cuts and staff changes. This can be a very tough decision for a lot of people because obviously your staff and your team's livelihood is very important to you. Look at negotiating holidays and unpaid leave.

You can't force people to take their annual leave but you can discuss with them and encourage them to take the leave. Reduce hours, pay and sick leave obligations, and also be aware of the stimulus support.

It is clear that if somebody's diagnosed with covid-19 or if they're providing care or support to a family member then they have access to their personal and carers leave in the case of full-time and part-time staff. The situation with isolation is a little bit more challenging and confusing. We highly suggest you get specific advice from a HR professional

You can make any arrangement with your employees that's above and beyond the minimum obligations that are required upon you. However, it is generally not advisable that people pay leave in advance. It often doesn't end well.

The first step in my view should be to just try and negotiate with people and just say “look guys, you know unfortunately these things here and it's affecting our business, I don't want to lose the members of the team and I want to keep you all engaged beyond once we get over this hump. However, we need to do something.”

Different businesses will have different levels of cash reserves and different culture so at the end of the day it's up to every business owner what they do and what they can do but definitely it's about the survival of your business and the about survival of your family then you need to do the right thing to make sure your business stays viable for the long term and that you can re-employ when things change.

Leadership and Communication During the COVID-19 Outbreak

Fri, 27 Mar 2020 13:51:18 GMT

Strategies for Our Current Business Climate

This is the first in a series of strategies to use in the current climate. Today we focus on leadership and communication .

LEAD

What do we mean by leading during this climate? You should not panic and you need to be positive and proactive. As a business owner, of course, there's a lot of risks that fall under our shoulders. It is after all our bank balance and we have to make the hard decisions that we need to make and so there's obviously going be a lot more strain on a business owner than the staff and they may not all appreciate that but at the same time, it is up to us as leaders of our businesses and in in in our industries to stay positive.

Let’s liken this situation to a party or a networking event. If you went to a party or if you met people at a party and you met people who are down, negative and always talking about the woes of their life, they're people you want to avoid generally. On the other hand, you automatically gravitate towards people who are positive and enthusiastic.

The same is going to happen in this situation. Your customers will gravitate towards businesses that are positive. Those that are proactive who want to try things and have a can-do attitude.

Your attitude and your mindset will flow down to the rest of your team and to your customers so just be very aware of that.

If we are focused on the area of concern that we can't really do anything about, it's just counterproductive. You should instead shift your focus on things that you have influence and can control.

If we focus too much on the circle of concern where we don't have any control or influence, it's just causing us stress for no reason. We need to be aware of what's out there but we need to focus on what we can control and what we can influence. Otherwise, it's just counterproductive and it's just a waste of energy.

It’s also important to be decisive and make decisions around this issue, understand what

the impacts may be, make those decisions sooner rather than later and lastly be fair and empathetic whether it's with your team or with others here in the community.

Be realistic too. Every business is going to be in a different situation. Some will have plenty of surplus funds that they can draw on others will be a lot tighter in terms of margins and cash surpluses so some businesses may be able to weather the storm a bit easier and maybe potentially hold on to staff or will not reduce hours but others may need to make decisions more quickly.

PROACTIVE COMMUNICATION

You obviously need to communicate with your team regularly and keep them informed. Make sure they understand the situation and potentially how things may develop over the coming weeks. You should definitely communicate with your customers as well.

You can communicate proactively through social media. You can post on your Facebook page about how seriously you’re taking hygiene, give some tips for people, refer back to your five-star food and safety certificate, and so on so.

It’s definitely advisable that you be proactive with customers. Once they've made a decision not to come, it's hard to convince them otherwise. So get on the front foot and re-emphasize your hygiene practices and delay those fears that they may have.

With suppliers, it’s important to keep them informed too. If you can't pay for whatever reason, people are generally quite accommodating if you're open and honest so it is all about being proactive with the communication with your networks. It could be your partners that you have, other people that you work with or people outside of your supply network.

People want some reassurance and communication these sort of uncertain

times so just get out there and do that. Definitely get out there and put some sort of press release out or some sort of statement.

Choosing Bookkeeping Software

Fri, 21 Feb 2020 16:02:14 GMT

Choosing bookkeeping software is such a big decision. If you are just starting a business, you have probably put some thought into how you are going to send out invoices to customers as well as keep track of your finances. There is a lot to it. If you Google bookkeeping, you will more than likely get ads for QuickBooks On-line and a bit further down the page, probably some other options. There are many of them to choose from.

Factors To Consider When Choosing Bookkeeping Software

So how do you choose the right bookkeeping software? The first thing is not to choose something quickly or just because it looks like it fits you. You want to think through what you want and need to do. Not just today, but you want to plan for growth. That’s why you are in business, right?

Are you just looking to keep track of how much cash you have? If that’s the case, you might not need anything. Your bank’s website can tell you that at any time.

Are you just looking to be able to complete your tax return? Again, your bank website plus a spreadsheet may work for you. But you will have to have some good spreadsheet skills.

Are you looking to invoice customers? Again, you might be able to get away with a spreadsheet and PDF to send them, but how will you track them? How are you going to make sure nothing slips through the cracks?

Will you be using a Point-of-Sale system? Most of these systems now come with great reporting capabilities. You can see sales information pretty much in real-time.

What about inventory? If you are carrying inventory, that will make a huge difference in what you choose. If you’re a restaurant you won’t inventory each item you sell, you will inventory the ingredients. However, if you are a retail store, you will inventory each item you sell. How are you going to keep track of that? Inventory losses (shrink) is a huge issue for small business owners.

Are you looking to track your income and expenses regularly, so you will know where you stand? Do you want some useful information at the click of a mouse? If that’s the case, you are going to want to go with some sort of accounting software.

Then, of course, there’s payroll. How are you going to pay your employees if you have any? How are you going to make sure you stay compliant? These are big issues to think about.

Choosing The Right Bookkeeping Software

If you’ve decided you need some sort of accounting software, what kind? There are many to choose from. Some are free, while some are very expensive. While I am a firm believer that you get what you pay for, I also never want to pay for something I don’t need. How do you find the balance?

Is it one system or a combination of systems?

There are a lot of options to consider when it comes to bookkeeping software. Hopefully, you do this before you start, but if not, don’t panic. There are always ways to improve, and improvement can come at any time. If you have questions on any of these bookkeeping dilemmas, please feel free to contact us . We would love to help you wade through all of it.

In our next blog post, we’ll talk about QuickBooks desktop vs QuickBooks On-line.

Managing Finances While Running Your Small Business

Wed, 15 Jan 2020 20:02:28 GMT

“Successful people aren't born that way. They become successful by establishing the habit of doing things unsuccessful people don't like to do. The successful people don't always like these things themselves; they just get on and do them.”

– William Makepeace Thackeray

What Do Small Business Owners Dread About Finances?

I’m sure you’ve seen or read a similar version of the quote above. And maybe in the past, you’ve read it and moved on with your life without giving it another thought. I’d like to take a moment to examine it and see how it pertains to running your small business.

When I talk to other small business owners, I find most people tend to have similar “things” they enjoy spending time on and “things” they dread.

THEY ENJOY...

Meeting & engaging with existing/potential customers
Delivering their final product/service
Developing new revenue streams

THEY DREAD...

Managing finances
Legal mumbo-jumbo
Managing internet presence

Looking at the lists above, I can certainly see a theme and why I’m hearing this. Small business owners like and believe their business will help their customers and are not afraid to pursue this goal. After all, they DID come up with the idea for the business themselves, so go figure! Doing things that take a lot of time due to lack of understanding the how takes a back seat most of the time.

How Do Small Business Owners Develop The Right Habits?

Let’s take a closer look at the dread factor for a moment. All of these items are necessary parts of any business – small and large. In fact, I’d venture to say they are the foundation.

Without knowing where you stand financially, how can you make good on your delivery? How can you make educated business decisions?
If you’re not set up for/on top of the legal requirements to do business, you’re going to have a bad time when Uncle Sam comes calling.
Who do you know that lives comfortably selling door to door?

But, goodness, who has the time to learn each of those things? You might be saying “I’m one person. You can’t seriously expect me to spend the next 4-5 years taking classes to run such a small business.”

I don’t. I didn’t.

Thackeray doesn’t say we should just do everything ourselves, but rather, that we should develop a HABIT of doing them. Let’s do a quick case study.

In my business, I manage my own finances. However, I know I lack knowledge when it comes to internet presence & navigating legal waters. So, the habit I have developed is working with subject-matter experts in that field who can advise on best practices. I use networking and professional services to accomplish this. Take some time to try out various networking opportunities available in your area. Commit to attending at least 1-2 events per month.

Important Questions to Ask About Business Finances

In addition to attending networking events, reach out to providers of professional services to talk through your business needs and what they can provide. In your discussions, make sure to ask about habits they’ve developed to put you at ease with their expertise. Here are just a couple questions to ask.

How do you stay apprised of new trends/requirements in your industry?
How do you communicate these with your customers?
How are you looking to grow? How can I be part of that?

You’ll notice these are not yes/no questions. These are designed to evaluate the provider, but also can lead to you better understanding the services you’re paying for. Most reputable professional service providers will have no problem answering these questions as part of their initial evaluation call.

Which brings me to my last point. I would never recommend hiring a professional services provider without doing an evaluation call first. I mean, you wouldn’t hire someone internally without an interview, so why would you do that when hiring externally?

If you think you might have a need for a financial services professional, please schedule a time here . Worse comes to worse, we end up not working together, but at least you got the chance to practice questioning!

The What, Why, How, and How Long of Record Keeping

linda@ldgaccountingservices.com (Linda Gober) — Thu, 04 Oct 2018 19:17:46 GMT

Running a business without keeping accurate records is like playing a football game without keeping a score. And yet, too many business owners do not know the current score of the game they’re playing in.

So today, we are going to cover why it’s to your advantage to keep accurate records, which records to keep and for how long, and how to keep them.

This might not seem like the most exciting topic, but it can save the day or keep you from a major headache, so it’s worth your while to make sure you’re keeping good records.

Why It’s Important to Keep Records

Here are a few reasons why keeping good records will make your life easier and your business run more smoothly:

Tax time will be easier and less eventful – no one likes an eventful tax season, including accountants!
You’ll have a better sense of organizational strengths and weaknesses.
Decision making will be easier because you’ll have a more complete picture.
Future loan processes will require less preparation.
You’ll be more equipped to manage change.
You will decrease the risk of theft from within the business.
You’ll maximize tax deductions and as a result, you may reduce your tax obligation.

What Records to Keep

There is some variation from industry to industry, business to business, but there is also a lot of overlap that applies to all businesses, no matter their size or model.

The records you should be keeping up to date include:

Profit and loss statement
Balance sheet
Budget vs. Actuals Report
A list of all expenses
Sales and/or invoices
Bank and credit card statements
Tax deductible expenses
Tax returns and quarterly tax payments, if applicable
Payroll
Inventory
Petty cash
Check stubs
Property investment records
Client or customer files, including contact information and a record of sales
Any and all contracts with suppliers, customers, employees, etc.
Employment applications
Human resources files
Articles of incorporation, licenses, and permits

How to Best Keep Your Records

The best record keeping system will make your life easier, not harder. So find a system that works for you and stick to it. In terms of online software systems, it has been our experience that you get what you pay for. The free options usually aren’t all that helpful.

Whatever you do, don’t let it all pile up. That’s how it becomes daunting and you end up avoiding it completely.

Once you have a system in place, you might wonder how long to keep your records. All tax returns should be kept forever, as should papers relating to properties, incorporation, and personnel. Supporting tax documents like deductions should be kept for 7 years, as should most other records.

Once you get in the habit of organizing records using a system that works for you, it will be an easy task that will give you peace of mind and insight when you need it. If you want help setting up your financial records, contact us today .

5 Ways to Help Ensure You Get the Right Small Business Loan on the First Try

linda@ldgaccountingservices.com (Linda Gober) — Thu, 13 Sep 2018 10:32:54 GMT

According to a survey by Nav, a business credit marketplace, 23% of small business loan applicants who were denied don’t know why their loan was turned down. And even worse, 45% who are denied are turned down multiple times.

When at least 1 out of every 5 business has not gotten a loan they have sought in the past 5 years, lack of awareness about the pitfalls of seeking a loan is a real problem among small businesses. When that happens, small businesses turn to riskier sources for funding like credit cards and dipping into personal savings, or they go without. In some cases, lack of cash flow leads to shuttering businesses completely.

Even if you’re among the lucky (and well prepared) business owners who have secured a loan in the past, you can make the process smoother, easier, and more cost-effective in the future by following these 5 tips.

1. Know your business credit score, and everything else the lender will look at.

45% of small businesses don’t know that they even have a credit score, and an eye-bulging 82% don’t know how to interpret them, according to the same Nav survey.

That lack of knowledge has big consequences. Those who are aware of their credit scores are 41% more likely to get approved, and have an even higher likelihood of a smooth loan process.

Do you homework in advance by researching your credit score and pulling together necessary information for lenders like:

· Personal financial statements for owners and/or principles

· Business financial statements and tax returns

· Ownership and affiliate contact information and resumes

· Incorporating documents and/or licenses

· Business loan history

· Location lease

2. Determine what will best suit your needs.

Potential lenders will want to know exactly how much money you’re seeking and under what terms, as well as what you plan to do with the money. That might sound elementary, but you’d be surprised how many small businesses make the mistake of going to the bank with open-ended goals.

This is one of the most common reasons businesses are turned down.

Also, keep in mind that there are many different types of loans out there. Once you have your plans for how you will use the money, take a look at options like establishing a line of credit as opposed to a traditional one-time loan. A floating loan you can draw from might better suit your needs, and stating that or any other needs up front will lend credibility to your application.

3. Look at all of your options.

Some business owners just head down to the local bank when they need a loan, and while that can be a great option, it’s far from your only option. You might find that an online bank offers a lower interest rate, more appropriate sum, or better repayment terms.

There are also industry-specific lenders that might be able to give you a break based on your association memberships or type of business.

Just be sure you’re dealing with only credible lenders. Know their history and that they are FDIC-insured.

4. Know what you’re getting yourself into.

Banks and other lenders sometimes hide extra fees that can really add up. I recommend you use a business loan calculator to ensure that you can afford to pay off the full cost of the loan.

Another mistake small business owners make is seeking more credit than they actually need, which can be costly in the long run. This is where your accountant can come in handy to determine the right sum to accomplish your objectives.

Once you have an offer or offers on the table, you might need to engage in some negotiation to get more favorable terms.

5. Get the help of a trusted expert.

Who said you had to navigate these murky waters on your own? The Small Business Administration provides business loan resources. Even more helpful, a trusted accountant or other financial advisor can serve as a mentor through the loan process.

We provide these services for clients regularly, so we know what pitfalls to avoid and how to make the process go as smoothly as possible. If you want our help to secure the right small business loan for you, contact us today .

The Financial Tool That Can Help You Make Smart Decisions

linda@ldgaccountingservices.com (Linda Gober) — Thu, 30 Aug 2018 14:48:27 GMT

Budget vs. Actual Reports

Have you ever gotten this far into the year and thought, “Well, that budget I made back in January is so far off, I might as well toss it out the window!”

If so, you aren’t alone. This is very common for small businesses because one big expense or change in clients can throw your numbers off dramatically.

That’s why the tool we are going to discuss today is so valuable and worthy of your time.

It’s a Budget vs. Actual Report, and it compares what you budgeted at the beginning of the year to the reality of earning and spending. It helps you evaluate how well your initial plan is working, and how to make business decisions going forward.

QuickBooks offers this report. As QuickBooks ProAdvisors, we not only offer this service to our clients, but also can offer you a rolling 12-month Budget vs. Actual Report, which is not available in QuickBooks.

It’s a simple spreadsheet and most of the numbers fill in themselves. Here’s what to include:

Your line items for income and expenses, just like on your budget
A column to fill in actual income and expenses
A column for budgeted income and expenses, copied and pasted over from your budget
A column for the dollar amount you are over or under budget
A column for the percentage you are over or under budget

Within a matter of minutes, you can get an important new perspective on your earning and spending.

At first, your Budget vs. Actual Report will bring up questions for you, like why was that expense so much higher than I thought? Or what can I do to bring in more income, since I’m not meeting my target?

This might seem stressful at first, but the important thing to keep in mind is that you’re tracking it, and that’s the first step to improving it.

Here are the benefits of keeping a Budget vs. Actual Report:

It’s a clear way to measure how well you are meeting your goals. Often, we lose track of goals over the course of the year, but this system makes it difficult to ignore how well you thought you’d be doing in comparison to how well you’re actually doing.
It tells you where to focus your time and attention. When you see numbers that aren’t what you had planned, those areas might need improvement. Your business management will be more effective because you see what’s lacking.
It allows you to see the future. Okay, not really. But over time, you’ll get better at predicting where your money is going and coming from and how that compares to your ability to plan.

If you’ve implemented tips from our last blog sticking to a realistic budget , add the step of running a Budget vs. Actual Report to your monthly budget appointment you have set up for yourself.

Once you get in the habit of running this report, it will be an easy task that will give you so much insight. If you want the assistance of a trusted accountant in setting up your Budget vs. Actual Report so you can run it easily month after month, contact us today .

Budgets

linda@ldgaccountingservices.com (Linda Gober) — Thu, 09 Aug 2018 16:29:47 GMT

Why It’s Important to Set a Real Budget – And Stick to It

If you’re like many small business owners, you have the best of intentions with your annual budget.

Each year, you vow that this year will be different! You’ll make a thorough budget, update it, and spend within it. But then, reality sets in. Unexpected expenses come up, revenue goes off track, and you get busy and forget to maintain your budget.

Despite the day to day realities of owning a business, it is possible to maintain a realistic budget and stick to it.

And time is of the essence! The fall is a great time to start working on your budget for the following year before the hustle and bustle of the holidays begin and then 2019 is upon us.

A budget is not a static document, but a tool that is meant to be used. Here are the reasons it’s so essential you maintain a budget:

● A budget gives you control. You can anticipate when revenue will be lower and higher, how to make staffing decisions, and when to focus your marketing efforts.

● A budget gives you flexibility. The great thing about being a small business owner is that you can change your budget whenever you need to.

● A budget keeps costs in check. You can see in black and white the impact of your spending and make adjustments as you go.

● A budget makes tax season easier. If you aren’t setting aside enough money for taxes throughout the year, April will come with a tough pill to swallow.

● A budget will give you peace of mind. It’s easy to stress out when one client or customer stops working with you or a big expense pops up. But a glance at your up-to-date budget will remind you of the bigger picture.

So now that you know why it’s so important, you might be wondering how to improve upon your budgeting practices, especially if you made a budget back in December or January and haven’t looked at it since then.

Here are four easy things to implement tips:

Set up a time with your accountant or trusted financial advisor to look at your budget monthly. This is one of the services we provide our clients. We use that time to update the previous month’s expenses, make sure any inventory and staffing for the month to come are covered, and see if changes are necessary. This is worth the time investment because it will make your life so much easier!
Set aside a larger amount of time before the end of this year for goal setting. Figure out what you want to accomplish in the year to come and then work with your accountant to determine how that will impact your expenses and income. This is the time to look into your crystal ball for potential big costs and/or risks with expenses like technology and staffing.
If you don’t have this already, put a line item into your budget for taxes so that when it comes time to pay estimated taxes or annual taxes, you will already have the money set aside.
It’s better to overestimate than underestimate spending. It’s difficult to know exactly how much you’ll need to spend, but I would rather be pleasantly surprised than caught off guard!

By putting these tips into practice, you’ll be setting yourself up for more success and less stress. If you want greater peace of mind about the financial health of your business, give us a call today . We can help you set up and maintain a budget that makes it easier to meet and exceed your business goals.

Stay tuned for next week’s blog post, with more information on how to compare the budget you project at the start of the year with your actual spending.

You're halfway through the year

linda@ldgaccountingservices.com (Linda Gober) — Tue, 19 Jun 2018 19:51:22 GMT

What should you be doing to make the second half of the year great

So, June has come to an end so is half the year. What happened to it!

Your business is running, sometimes smoothly, sometimes not… but it's going! It’s the halfway point of the year, time to take stock of where you are and plan to make the second half even better.

Here are a few things to look at from your financials:

1. How are you doing revenue wise? Compare these numbers against your budget and what you did last year. Was it a better half year? If so, why and what did you do to make that happen. You want to keep doing that! Was it a worse half year? Again, if so why? Understanding why your revenues are what they are is the key to making necessary changes or continuing to do what is working.

2. What about Cost of Goods Sold. Is it where it should be? This is normally one of the two biggest expenses for a small business. It is imperative that this be controlled. This is one of those numbers however, that you don’t necessarily want to compare the actual number for. You want to look at this number as the percentage to revenue. Let’s say for example if your Cost of Good Sold is $100,000 which is exactly what your budget number is. That is great if you made your revenue budget, but what if your revenue is down by $50,000. If that’s the case, the $100,000 is a bad number and needs to be investigated.

3. How about expenses? Same thing here, compare these to your budget and what you did last year. While you look at your expenses almost on a daily basis as a small business owner, it’s important to take a “big picture” look periodically. It’s easy to spend and extra $100 every now and then, but it takes a big picture view to see if you’ve been doing that to excess.

4. The only thing left now is profit. How did it compare to what you expected it to be? The factors above will explain why it is or isn’t, but it’s up to you to make the changes so that going forward it will be what you expect.

Here’s a quick checklist of other things to look at, at least annually and this is a good time to do it:

1. Website audit – Is your website up to date, does it need some work?

2. If you don’t have regular contact with your customers, now is a great time to touch base with them.

3. Insurances – it’s important to take a look at all of your policies at least once a year. Don’t wait until renewal time. There’s not a lot of time to really compare options if you want until then.

4. Legal – Do you have a lawyer? Every small business needs a plan on how to deal with legal issues that may come up.

Once you’ve done that, it’s vacation time! Take some time to relax and decompress! Everyone needs it. Comment below and let us now what your plans are!

QuickBooks On-line keyboard shortcuts

linda@ldgaccountingservices.com (Linda Gober) — Mon, 04 Jun 2018 14:13:26 GMT

I have to say, I am definitely a keyboard person. But, with all the functions available in QuickBooks On-line it’s impossible to know all the keyboard functions, so here’s a handy list of the most used ones for PC and Mac users from Intuit.

How To Choose The Right Accountant

Fri, 01 Sep 2017 13:25:34 GMT

You Need A Trustworthy Accountant

How many people in your life would you consider trustworthy? Probably your parents, hopefully your children, brothers, sisters, possibly a few close friends. These people you consider trustworthy based on years of experience. You’ve know them “forever”. In our personal lives we are aware of precautions to take, lock your car and front door, check your credit report periodically, don’t share your PINs, and the list could go on.

How about in your business life? How do you determine if someone is “trustworthy”. There are many times when we put our trust in people and it ends up badly. The job applicant that doesn’t show up for an interview, we depended on (trusted) that person to not waste our time. Or what about an employee who treats a customer rudely? We may consider this a bad hire, it is because this person is not trustworthy. These are examples of how we trust people on a daily basis.

The question becomes, how do you know you can trust someone? For the job applicant that didn’t show up for the interview, you know the answer, be thankful they didn’t show up so you didn’t have the opportunity to hire them. Once we get someone in for an interview, how do we figure out whether or not they are trustworthy?

There are many ways, do they look at you straight in the eye when answering questions, what is their body language saying, how do they react to difficult questions? We also employ tools such as background, drug, and personality tests. These are all great ways to ascertain a potential employee’s trustworthiness.

What about hiring an accountant? The principles are the same! You need to take the time to interview multiple accountants before deciding upon one. You are going to be giving this person key financial information that you probably won’t give to some of the most trusted people in your personal life. Another important thing to look for is whether or not this person is really interested in your business or are you just another name on their list of clients. Don’t underestimate this, when you are running a small business, you need a great team of people to help you become successful. This is another position that should be a cheerleader for you, not just a bean counter. The experience this person brings to you will be invaluable.

So, how do you find this list of accountants to interview? Referrals are the best way, but don’t just get one, ask multiple colleagues and friends as well. Another great person to ask is the CPA who does your taxes for you. This person probably has a list of good accountants that you can talk to. Sometimes they offer those services themselves. But don’t just assume that is the best person to handle your normal accounting. It may be, but it may not be. You need to take the time to figure this out yourself. If you feel comfortable with someone, go to the next step and check references.

By far, the most important characteristic for your accountant should be trustworthiness. If you don’t feel the person is the most trustworthy person you found, don’t use them.

What other characteristics do you think are important for your accountant to have?