Blog | My CFO Portal https://mycfoportal.ca My CFO Portal | Accounting and Bookkeeping Fri, 27 Dec 2019 07:20:30 +0000 en hourly 1 https://wordpress.org/?v=6.4.5 https://mycfoportal.ca/wp-content/uploads/2018/12/cropped-cfo-logo-32x32.png Blog | My CFO Portal https://mycfoportal.ca 32 32 Financial Management https://mycfoportal.ca/financial-management/ https://mycfoportal.ca/financial-management/#comments Thu, 03 Oct 2019 07:25:22 +0000 https://mycfoportal.ca/?p=220388

Understanding profit margins is the most critical component of healthy financial management.

 

For a product-oriented business, profit margin mainly focuses on goods and materials, and that can easily be quantifiable.

 

For a service-based business, it is a bit trickier to calculate the profit margins. Several factors decide on costing a service stream and setting up prices for sustainable margins.

 

As one of the top suppliers of business services, Onshore Advisors make sure that we provide the best possible solutions to our clients to manage their finances effectively. When we get a service-based project, we consider quantitative and qualitative factors to current and future return of investment.

 

We also compare it with peers to figure out whether the business is getting a good return on investment or not.

 

Owning a business can be rewarding and remunerative, but still, it is pretty tough to make it sustainable at the startup phase. A company got to have accounting personnel/department available to have a visibility of cash flow. If somehow, an accounting function available, it could slow down your progress or even be disastrous in some cases.

 

As one of the top suppliers of business services in Canada, we can help you irrespective of the stage of your business.

 

We have a team of highly professional accountants working right now. Our accountants believe that accounting is the language of business. The goal of Onshore Advisors is we are going to provide the best service in managing your business finances.

 

We, as a top supplier of business and accounting service provider in Canada, want to attain that level of significance where no one is looking at. An organization that is entirely devoted to his services will face only one worry about the profit that they are whoppingly immense. In short, all we are trying to say is that if an organization has a service that we provide has a great chance to make it big in the future.

 

Onshore Advisors, through its division called “My CFO Portal” provide high-quality services for outsourced bookkeeping, accounting, and also payroll services for businesses across Canada and globally.

 

 

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SME Budgets https://mycfoportal.ca/sme-budgets/ https://mycfoportal.ca/sme-budgets/#comments Thu, 03 Oct 2019 07:18:51 +0000 https://mycfoportal.ca/?p=220384 Is Budgeting a Waste of Time for Small and Medium Enterprises (SME)?

There is a famous quote from TshOxenreider “The simplest definition of a budget is “telling your money where to go.”

It is crucial for SMEs to estimate their income and expenses, and based on this estimation, tell their money where to go.

Budgeting ensures planning and monitoring of financial activities; therefore, it is essential for SMEs who would like to sustain and grow their operations.

 

What is a Budget:

An estimate of income and expenses for a set period is known as a budget.

 

Are There Different Types of Budgets:

Yes, there are various types of budgets, depending upon where it is required. These include but not limited to historical or incremental budget, flexible budget, zero-based budget, Kaizen budget, etc.

It is a fact that due to constraints of finance and lack of staff and controls, SME may consider Historical or incremental budget as a management and control tool for their organization.

 

Approaches to Budgeting:

There are mainly two approaches to budgeting. The top-down and second one is bottom-up. To elaborate top-down budgeting, it means the top-level (strategic management) of the business decides the budget for a particular period, and the whole team works to achieve that budget. Another one is bottom-up budgeting which attempts to determine the underlying cost of each segment of the organization and then total up each department. As this is being developed at the operational level, therefore it is less stressful for the operational and tactical management, and this has more achievability sense and targets as compared to top-down budget.

 

Factors to consider while developing the budgets:

When we talk about planning and budgeting, there are various factors that we need to look at:

  • If a company is new, then we may have to a look at the financial data of another comparable company who is of the same size and also operates in the same industry. A new company needs to look at the sales, operating costs, revenue, and salaries of the comparable company to develop a budget. This is a kind of historical budgeting.
  • Whereas when an established SME considers developing a budget, then the company has to follow some essential rules otherwise result will be pretty different as per expectations. We see many new SMEs start their business and in short period fails, one of the reasons behind this failure is lack of planning and budgeting.
  • A very optimistic and high budget may lead to lack of motivation and stressful due to un-achievability.

Similarly, a pessimistic budget may lead to lack of focus and desired targets.

  • Lack of focus on elements of costs. As an example is research and development cost.

Research and development costs include fixed cost and variable cost elements. A startup has to bear these expenses, whether the company is generating revenue or not for a particular period. As the fixed part is unavoidable, therefore a proper budget development activity may devise a plan to minimize the variable elements of costs.

  • Another factor that has a significant influence on the company is forecasting a revenue stream, which means that a company must have a goal on which the whole team needs to work together. While developing a budget, a company must use conservative and achievable revenue estimate/targets.
  • Emphasis on the non-financial budgeting factors also plays a part in developing a financial target/budget as one may say that a company cannot generate their forecasted revenues without having a strong customer base.
  • Discussing expenditure with tactical management (head of the department) will sort out many issues and problems regarding practical budgeting and behavioral issues during the financial / budget period.
  • Creating a contingency plan or allocating costs for contingency may help small business to do better in times of recession. Conducting risk analysis and planning for financial under performances helps to develop a contingency plan.
  • The most critical thing regarding budgeting is planning a regular budget review. If a budget is reviewed quarterly, it allows flexibility and acting in response to a situation helps a business to grow properly.

 

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Accounting Software Vs. Enterprise Resource Planning Software (ERP) https://mycfoportal.ca/accounting-software-vs-enterprise-resource-planning-software-erp/ https://mycfoportal.ca/accounting-software-vs-enterprise-resource-planning-software-erp/#comments Fri, 13 Sep 2019 12:12:38 +0000 https://mycfoportal.ca/?p=220341

 

During the past several years, business management technology has evolved. Advancement in technology has simplified the processes of data capturing and has provided unlimited capacity and capability to analyze the data and use it for the management of businesses.

To most people, software for accounting and enterprise resource planning (ERP) software are interchangeable, however, in reality, these are two very different things, and they aren’t interchangeable.

Accounting Software

Accounting mainly deals with quantitative data. The role of accounting is to capture, retain, and report transactions that involve income, expenses, assets, and liabilities.

Accounting, in today’s world, is carried out using the software, that may be cloud-based (using web) or stored locally (on the company’s computer or server).

The role of bookkeeping software is to record business transactions to facilitate an accountant in generating financial details. The financial information may consist of a balance sheet, statement of accounts, trial balance, statement of cash flow, profit and loss, assets, and taxes, among other items.

The business accounting software, previously, had limited capabilities. Lately, adding new features to the existing software are making lives of accountants and entrepreneurs easy. For instance, software like Quickbooks, Xero Accounting, SAGE have added more functions, including inventory management, purchase orders, and timesheets, to name a few.

Most of legacy small business accounting software providers are advancing towards cloud service. The data remains online, and it enhances the ability of the bookkeeping software to interface with other online tools. A great example is Hubdoc, a document management system that works with the business accounting software and helps in allocating receipts data to the transactions.

Business accounting software provides many benefits for the company, such as accelerating the work of financial statements, avoiding miscalculation, improving job efficiency, automating various transactions, assisting companies in the decision-making process by presenting accurate data, and figuring the financial condition of the company at any time. In short, bookkeeping software provides a good snapshot of business financial health.

ERP System

On the other hand, ERP system is a different ball game altogether. An ERP system collects data and transaction from the various business processes into a centralized data warehouse.

It is a suite of software that business or organization use to manage day-to-day activities such as accounting, HR, manufacturing, procurement, project management, supply chain, CRM. ERP system integrates these various functions into one complete system to streamline processes and information across the entire organization. ERP system uses machine learning and AI to improve visibility and efficiency across every aspect of the business. ERP can be on cloud, on-premise, and hybrid. They can be of different size for small to a huge corporation. Some well-know ERP companies are SAP, Oracle Netsuite, MS Dynamic, ZOHO, Odoo, to name a few.

Difference

Although the integrated accounting system and financial module in ERP system have some similarities. For instance, both include financial accounting functionality such as double-entry bookkeeping, a general ledger, and journal and account reconciliation capabilities. Both also have tax analysis and reporting features, and also help with budgeting and planning. However, as an “enterprise resource planner” manage all aspect of the business.

Some of the vital differences are:

  • Bookkeeping software does not include sales and customer relationship management.
  • ERP software often has a CRM module that lets you access and updates contact information and sees the history of previous communications.
  • Accounting software is limited in providing real-time data. Since ERP have integrated all the system of organization, the output we get is real-time

How to Choose Best Accounting System for Small Business:

The best answer is “the one which provides you value for money”.  A small businesses lack financial and funding flexibility therefore they have to find out the best possible solution within their budget.  Another aspect is implementation, operation, control and sustainability of selected business accounting system.

Although there are several cost affective ERP software available in the market but still in order to operate such system, small businesses have to invest in people and IT infrastructure (physical or virtual).  Whereas for the growing businesses, it is in their best interest to select enterprise resource planning software.

Online solutions of accounting packages are considered as the best accounting system for small business.  Quickbooks online and Xero are examples of cost effective solutions for a small scale company.  These systems are kept on evolving and they are even capturing financial and non-financial data which is enough for the operations of small businesses.

Why mycfoportal.ca?

We, at mycfoportal.ca, provide free consultation to the clients about the best accounting system for small business.  Although we believe that business scale is not a consideration in selection of a business accounting system but it has been considered as a major factor for this decision making.  We have seen that medium to large enterprises are also using Quickbooks or Xero as their business accounting solution.

Our affordable packages include hassle free services for the small and medium (SME) businesses to outsource their accounting function and concentrate on operations and commercial aspects of their business. We are a team of highly experienced specialists covering all aspects of business planning, accounting and consulting.

 

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Back of the Envelope Calculation for Long Term Investment https://mycfoportal.ca/back-of-the-envelope-calculation-for-long-term-investment/ https://mycfoportal.ca/back-of-the-envelope-calculation-for-long-term-investment/#respond Sat, 16 Feb 2019 21:12:18 +0000 https://mycfoportal.ca/?p=219785 Sorry to say but some finance professionals speak an ambiguous language. If you ask them whether this project is feasible or not, they will tell you that they will have to use capital budgeting techniques. Moreover, if you ask what capital budgeting is, they will tell you it is the process used to determine whether the long term investment is worth the funding of cash through your company’s capitalization structure. Difficult to understand – right.

You might have seen entrepreneurs who make decisions on the toe. You tell them about the investment and the cash generated by it per year, the life of the project. They will quickly tell you whether it is an exciting project or not and whether they want to investigate this project further or not.

Usually, the entrepreneurs use payback period estimates to shortlist the projects. The calculation is quite easy, and it does not require worksheets, financial calculators or anything like that. That’s why we say it back of the envelope calculation. So let us use an example. Somebody has contacted you that there is a long term project that requires an investment of $100,000 and its yearly return is $20,000. The project will last for ten years.

Let us do a back of the envelope calculation. If you invest 100k and get 20k per annum, you will get your money back in 5 years. The thumb rule is that lower the payback period, the higher are chances that the investors will further investigate the project.

The payback period is the period required for the amount invested in a project to be repaid by the net cash outflow generated by the project. It may be one of the simplest ways to evaluate the risk associated with a project. It is usually expressed in years and a fraction of years. Since it is a back of the envelope calculation, the time value money is not taken into account. Shorter payback periods are preferable to more extended payback periods. Payback period is popular due to its ease of use despite the various limitations.

The entrepreneurs keep a benchmark with them for the payback period, say three years. So in case, the project payback period is less than three years, they will ask their financial team to further investigate the project by developing future cash flows and looking at the riskiness of the project. The analysis is done by creating a complex financial model and then applying complex appraisal techniques such as net present value and internal rate of returns, discounted cash flows, etc. Once their internal team develops their calculations, the entrepreneurs based on their judgment further negotiate the price and timing of investment of the project. In case the cost is lower then the return from the projects will be higher also if the investment is phased over time, the entrepreneurs are expected to get higher yields.

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Accounting Reports to Monitor a Small Business https://mycfoportal.ca/accounting-reports-to-monitor-small-business/ https://mycfoportal.ca/accounting-reports-to-monitor-small-business/#respond Mon, 04 Feb 2019 12:05:20 +0000 https://mycfoportal.ca/?p=219779 Many people ask what accounting reports they should review regularly. Generally, I believe, that you should review the following accounting reports and particular on focus areas mentioned below to keep your accounting records and operations streamlined

Accounts Receivable & Aging Report

Accounts receivable show the outstanding balance of customers. Aging of accounts receivable shows how old are these balances.

Focus on old accounts receivable. Follow up with your customers by sending emails or calling them. Keep yourself updated on your customers’ credit situation and tighten your credit terms for risky customers.

Accounts Payable and Aging

Accounts payable show the outstanding balances of suppliers. The aging of these payable shows how old are these balances.

Focus on negative balances of suppliers. Negative balances mean that either you have paid a bill twice or you have made an advance payment and the goods or services are yet to be received. Thoroughly check your records to confirm or dispel the suspicion of double payment. If you have paid in advance and not yet received the goods or services, follow up with your suppliers.

Daily Sales Report

Daily sales report tells you how many units of goods or services you have sold on a day and how much revenue you have earned on that day.

Focus on the unit price of the goods and services that are sold. Check unusual discounts given to the customers. Compare historical day to day sales and investigate unusual variances in sales.

Budget vs Actual Operations

If you have made a monthly budget document, it should follow the format of the reports generated by your accounting system.

Focus on budgeted vs actual operations and review the actual number of units sold, sales, and unit price against the budget. Review your actual gross profit percentage and compare it with budgeted gross profit. Check your actual fixed expenses against the budgeted expenses. Investigate any unusual variance.

Bank & Credit Card Statements

Most of the payments and receipts are done through your bank account, right. Therefore, it is important to keep an eye on your bank and credit card statement. Subscribe for online statements and make a habit of checking your bank and credit card transactions on daily basis. Review any exceptional item and follow up with your bank in case you find some unusual transactions/ payment. Check with your bank even if the amount charged is small. Hackers usually charge a small amount first and if it goes through, they take out large money from the same account.

Bank Reconciliation Statements

Bank reconciliation statements are made to compare the entries appearing in your accounting system with those in your bank statement. Any difference between the two may be uncleared or un-presented checks. There may be some unrecorded expenses (such as bank charges).

Focus on uncleared and un-presented checks and record any unrecorded expenses in your books.

Cash Flow Statement

Cash flow statements provide information on cash received and paid by the business. Cash flow statements are divided into three sections that are – cash flow from operating activities, cash flow from investing activities and cash flow from financing activities. This statement tells you from where you are generating cash and where it is going.

Focus on cash flows from operating activities and investigate if sufficient cash flow is not generated to finance the investment and paying back the financing. Cash flow from operation is very important to understand and short- and long-term sustainability of the business.

Inventory Report

Inventory reports tell you the items in hand and their value on a date.

Focus on quantities that is low. These products may need to be ordered so there are sufficient quantities in hand to meet the needs of the customers

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Ways to Save Money for Medical Practice https://mycfoportal.ca/ways-to-save-money-for-medical-practice/ https://mycfoportal.ca/ways-to-save-money-for-medical-practice/#respond Sun, 27 Jan 2019 22:46:00 +0000 https://mycfoportal.ca/?p=219775 Profitability of any organization depends upon getting higher revenues and lower costs than its competitors. No matter how big or small, new or developed, manufacturing or service, you can benefit from cutting everyday costs. However today I will concentrate on medical practices and show by adopting a few simple techniques how we can save a significant amount of money, which can be used to improve your practice.

Set up an effective billing structure

Whatever practice type you have, the vast majority of physicians will bill in some form. There are several aspects to doing this effectively
  • Read your province’s schedule of benefits (fee book).
  • Make a cheat sheet of frequently used codes in your specialty. Some of your colleagues may have already done this.
  • Speak with others in your specialty. It is always good to see how others are doing and if required you can implement new techniques in your proactive.
  • The fee schedule is vague, interpretation varies by docs and ministry assessors, and there is often more than one way to bill for the same thing. Only bill for what you do but learn to choose the best way to do so.

Makes sure that you chart adequately

As a physician billing for your services, you may also need to make sure that your charting captures the information needed to prove that you provided the services that you get paid for.
Common Mistakes:
  • Not recording the referring physician for a consultation and giving them a written opinion.
  • Start and stop times for time unit based fees.
  • Procedure notes for common simple billable procedures.
  • Not mentioning that you were called in for after-hours care (there may be a drive-in premium)
  • Using the same diagnosis for different consults on a patient that address different issues. The same diagnosis may cause your code to be downgraded to a follow-up for the original problem.

A Good Accountant Is Like A best friend

A high-quality accountant will discuss the best options for you. This could be of some help with questions about payroll and your business plan. It also means helping you to tax-plan for your specific situation. Rather than just telling you to incorporate, they should discuss whether it is best for you. They can also save you from the predictable constant in life besides death – taxes.

Insurance

Make sure you have business insurance. I understand there is CMPA for malpractice however in order to do business it is good to have the insurance.

  • Disability Insurance.
  • Office/Clinic Insurance

Some other useful Techniques

  • Leverage Technology
  • Compare cost
  • Sharing or renting out extra office space
  • Cutting back on supplies
  • Letting patients schedule their own appointments online
  • Being aware of internal control.
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Ways to Reduce Cost in Manufacturing https://mycfoportal.ca/ways-to-reduce-cost-in-manufacturing/ https://mycfoportal.ca/ways-to-reduce-cost-in-manufacturing/#respond Mon, 21 Jan 2019 14:58:16 +0000 https://mycfoportal.ca/?p=219763 In today world, where manufacturing companies are looking to improve their bottom line, it is a must that they manufacture their products in an efficient and cost-effective manner. The point to focus here is that no matter how good your product may be if you can’t manufacture it cheaper than your competition, your business will most likely suffer.

Based on my experience there are following four main areas where we can save money:

 

  1. Material

In any manufacturing environment, material costs dominate the overall product cost. To reduce this cost, focus on the ways to purchase materials for less money and find ways to consume less material in manufacturing. Using an effective Material Resource Planning (MRP) system to purchase materials can help in reducing cost. Provide written processes, training, guidance and proper tooling to reduce the amount of material scrapped during production. Deploy lean manufacturing initiatives such as Six Sigma to evaluate opportunities for savings.

  1. Labour

After the cost of material, labour cost is the biggest cost for most of the manufacturing plants. This means, controlling the labour costs will boost your profits. Logically, there are two ways to reduce labour cost:

 

  1. Reduction in the amount paid to factory workers;
  2. Increase the efficiency of the workers.

 

Find out ways how can you achieve these objectives of reduction in payments and increasing the efficiency of the workers.

Such as one of the ways to decrease labour costs is to improve the efficiency of experienced labour. Check your process thoroughly and find out redundant or the processes that can be performed by one worker. Eliminate those processes. Reduce the time required to produce an average unit by providing specialized training that allows employees to work at a faster pace. Offer incentives to the employees who can introduce labor-saving techniques into your production facility.

 

  1. Overheads

Overheads are the expenses associated with the running of a manufacturing plant, some of the examples of overhead are utilities, supplies, travel and entertainment, and other administrative costs. In order to control the overheads, the first thing to do is after talking to different department heads, set-up budget for each department and monitor it on a weekly/monthly basis. Make sure to use an effective ERP system that is capable of carrying out of a variance analysis such as actual vs budgeted. Utilities can be reduced by having a smart thermostat which can be controlled from a smart device. Another way is using smart lighting, solar water heater and using efficient equipment can reduce your utility expenses. Travel expense can be reduced by telecommuting and supplies cost can be reduced by using less paper. By paying the invoice on time can reduce interest by quite a lot.

  1. Capital Investment

At some stage, the manufacturing facility needs to spend money to save money. Investing in equipment which is more efficient and reliable can reduce the cost of production in long run. Similarly, machinery that uses less material can also lower costs. However, before investing make sure to do a cost versus benefit analysis and look at NPV and IRR.

My CFO Portal (www.mycfoportal.ca)  can provide accounting, bookkeeping, Tax and CFO services to small and medium size business at a very reasonable cost. We have developed a very efficient system which can deliver service to anywhere is Ontario.

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HOW TO TRANSFORM YOUR IDEA INTO A BUSINESS https://mycfoportal.ca/how-to-transform-your-idea-into-a-business/ https://mycfoportal.ca/how-to-transform-your-idea-into-a-business/#respond Tue, 15 Jan 2019 22:20:38 +0000 https://mycfoportal.ca/?p=219760 Many times, you have a unique idea that you think can be the next breakthrough in your industry, but you don’t know how to go about it. A few months down the road, you see somebody else doing business using your idea.

All people are thinking and generating these ideas but there are only a few who take up the challenge of transforming their idea into a business. Did you ever think why is that? My analysis is that when it comes to the nitty-gritty, most of the people find it difficult to fully conceive the cycle of project development.  And even if they know the fine details, they are overwhelmed by the amount of work and tasks to be performed.

So next time, whenever you have an idea, write it down and try to get the answers to the following questions:

  1. Is the idea technically feasible;
  2. Is there a market of the idea we are floating;
  3. The idea is financially feasible.

Once you are satisfied that the idea met the above criteria, the next phase is to weave the infrastructure around your idea. The first phase of the transformation will need the following:

  1. Product / Service development
  2. Corporate structure
  3. Office/admin infrastructure

Your top priority is to develop the product or service and test it in the market. You will only get the competitive advantage if you develop the product /service efficiently in a cost relatively lower than the market cost.

Once you are pretty sure that you have a competitive edge, the next step is to set up a corporate and administrative infrastructure. The corporate and admin infrastructure depend largely on the type of product /service, however, as an entrepreneur, your goal should be to keep these costs at a minimum level, at least in the first phase. There are many ideas you can use to keep your costs minimum such as:

  1. Many entrepreneurs use their basements as their first office; you may use shared space in the earlier period to reduce the costs
  2. Rather than hiring full-time staff and paying salaries, you may outsource many functions such as marketing, accounting, IT services such as emails, websites, etc.

If you are confident that the products/services are stable and can be offered to public at large. It is time to move to the next phase that is a full-scale phase. Estimate the market price of the product/service and cost of making that product or delivering that service. The difference between the price and variable cost is your estimated contribution margin (A). For instance, if your sale price is $100 and your variable cost is $65, the contribution margin will be $35 ($100 – $65)

Once you estimate the contribution margin, do the following calculation:

 

  1. Decide how much profit you would like to make (B). Let’s assume you want to make a profit of $50,000
  2. Estimate total fixed cost (C). Assume your fixed cost is $16,500
  3. Add your profit and fixed cost (D = B + C). So in this example, your profit and fixed costs will be $66,500
  4. Divide profit and fixed cost by contribution margin (D / A ). Dividing $66,500/$35 gives 1,900. So 1,900 is the number of products/services that you should sell to achieve a profit of $50,000

The calculations are easy but the real catch is in the implementation of the project. Wish you best of luck for the transformation of your ideas into business.

 

My CFO Portal www.mycfoportal.ca provides accounting, bookkeeping, tax, and CFO services to small and medium-size business at a very reasonable cost. We have highly qualified staff members with the experience in a verity of industries.  We have developed very efficient system which can deliver service anywhere in Ontario.

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Accounting and Bookkeeping Errors https://mycfoportal.ca/accounting-and-bookkeeping-error/ https://mycfoportal.ca/accounting-and-bookkeeping-error/#respond Mon, 14 Jan 2019 13:40:48 +0000 https://mycfoportal.ca/?p=219757 To err is the human and that’s why the auditing profession exists. You cannot eliminate errors but you can materially reduce them.

For any size of business, the prime goal is to ensure that your business grows and thrives to ultimate heights in order to achieve this accounting and bookkeeping play a pivotal role. And one needs to make sure to avoid following common mistakes.

Handling All Accounting Work By Yourself

Most business owners have a do it yourself (DIY) attitude, which means that they do every little thing pertaining to business by themselves. It is good to reduce overhead cost, but you have to understand although in bringing it can be done however as your business grows if you don’t spend valuable time and it is not done properly, your business will be a source of many headaches.

Solution: Plan for a professional accountant in advance, so that you can get your auditing work done fast and thoroughly.

Record Expenses and Income on Time in Books

When you make purchases and pay using credit cards or cash, it is highly likely that you will forget to update that information. Such an action will cause a mismatch between the numbers in your books and those in the bank statement.

Solution: To avoid making errors, make sure to either note down the purchases in a notebook or get an accounting app that eradicates all the paperwork by just taking a snap of the receipts.

Using Proper Software

Proper accounting software is one that meets business needs and reduces the workload for your employees.

Solution: Make sure to invest in the best software available that will give you high accuracy in record making. Ensure that staff is able to use it too and if they are not, offer the necessary training.

Not Organizing Information Properly

Disorganized work is very displeasing and annoying, both for the business owner and your accountant. Failing to have proper categories in your account books makes referencing exhausting and recording difficult.

Solution: Have your work neatly organized to make tasks such as referencing and recording effortless and to give an easy time to your accountant while bookkeeping.

Difference Between Accounts and Bank Statement

When your books don’t match with your bank statement.  When this happens you can be sure that trouble may arise soon. Constantly failing to update information will eventually lead you astray because of the confusion it will bring as you try to fill in numbers to make them balance.

Solution: Always make sure that what has been tallied on your books is similar to what is in the bank statement, as it will give you confidence that everything is perfect.

 

My CFO Portal www.mycfoportal.ca can provide accounting, bookkeeping, Tax, and CFO services to small and medium-size business at a very reasonable cost. We have highly qualified staff members with experience in a verity of industries.  We have developed a very efficient system which can deliver service to anywhere in Ontario.

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BENEFITS OF OUTSOURCING https://mycfoportal.ca/benefits-of-outsourcing/ https://mycfoportal.ca/benefits-of-outsourcing/#comments Fri, 11 Jan 2019 12:46:28 +0000 https://mycfoportal.ca/?p=219749  

 

Fidel Castro once said, “I began revolution with 82 men. If I had to do it again, I do it with 10 or 15 and absolute faith. It does not matter how small you are if you have faith and plan of action.”

 

I think this statement fits into our current business environment. The sustainability of any business is dependent upon focusing on your customers’ needs and ensure that the contribution margin (sales price minus variable cost) of the product is maximized. And to keep your fixed costs minimum.

 

Artificial intelligence and technological advancements have increased the complexity of businesses. As a business, you need to continuously analyze the data to make sure that your product meets or exceeds the customers’ expectations and their needs. This effectively means that small to medium-size businesses should pay attention to their core operations without worrying too much on what is happening in the back office. For the back office, you should have “Faith” and “Plan of Action”.

 

For instance, accounting and bookkeeping services is a back-office job and can be outsourced to others. But before doing that, you may need to make sure that the service provider is reliable (professionally competent) and they give you a plan of action (process and reporting). If you are somehow able to manage these aspects of the service provider, you may get a competitive advantage over your competition.

 

I have listed down some of the advantages of outsourcing accounting and bookkeeping function to the firms providing accounting bookkeeping services.

 

  1. You can pay attention to what you do best

By outsourcing accounting and bookkeeping services from the mentioned firms, you will have more time to focus on the other aspects of your business such as ways to increase the efficiency and growth of the business.

 

  1. Reduce cost

By outsourcing, you can reduce cost by 30% to 60%

 

  1. Quality of service

Hiring qualified professionals who understand all the accounting and laws and rules reduce the chances of making error thus improving your business image. And provide you with accurate information to make informed decisions.

 

  1. Reduces the risk from the situation in which employees suddenly leave

Businesses might experience a situation in which most of their employees or staff suddenly leave. This can be catastrophic for small businesses as a backup staff is needed in such incidents and this can be costly. Outsourcing your accounting or bookkeeping services enables you to a qualified and professional team which provides an effective backup to your business. Rest assured, you can expect that the team will make sure that the quality of the work will be the same or even better.

 

  1. A more disciplined and unbiased view

Accounting and finance department plays a key role in making unbiased (free form office politics) and accurate information can be very useful for small to medium size business.

 

  1. Gain an edge over other businesses in the competitive market

Outsourcing firms have many years of experience working with different businesses. These firms have a professional and experienced staff that will make sure that you get the best hands-on experience. Outsourcing your accounting and bookkeeping services to these firms can provide you with these benefits that can provide your business an edge in the competitive market.

 

  1. Easily add or cut back on resources

Businesses usually have operating cycles affect accounting and bookkeeping workloads. During those specific times, adding more resources to the team is difficult to manage. Outsourcing such services allow you to easily cut back or increase the staff working for you, depending on what time of the business year it is. It enables you to enjoy the flexibility that is otherwise pretty hard to achieve.

 

 

 

My CFO Portal (www.mycfoporatl.ca) can provide accounting, bookkeeping, Tax and CFO services to small and medium-size businesses at a very reasonable cost. We have highly qualified staff members with experience in a verity of industries.  We are based in Mississauga and have developed a very efficient system which can deliver service to anywhere in Ontario.

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