Taking time to read the balance sheet report will help you identify bookkeeping mistakes and have a clearer view of your business.
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Continue readingCategory Archives: Accounting
How to avoid an accounting nightmare: Accountability
Let’s talk about accountability. What do you do with the money that comes in and out of your business? How do you monitor who’s doing what with that money? And especially if you have outsourced your bookkeeping, how do you hold that person accountable? Are they completing the work? Do you know whether your bookkeeping is correct?
Recently in a Facebook group, I saw someone post a comment saying she thought her bookkeeper was amazing, but she had no idea if that person was doing a good job.
That’s scary.
You need to know your bookkeeping is correct. Assuming or guessing will cost you money and possibly your business.
The best way you can know whether your bookkeeping is right and to hold yourself accountable and anyone else in your business accountable is to learn to read your financial statements and study them on a regular basis.
Ask questions, get answers.
Know where the money is coming from (best customers and products).
Know where the money is going and who is spending it.
Read your financial statements at least monthly.
That’s how you know whether your bookkeeping is correct.
Could Your Sales Invoices Be Better? How QuickBooks Online Can Help.
Every interaction with your customers can enhance your image. Here’s how QuickBooks Online contributes to that.
Getting paid by your customers-on time, and in full-can take some effort on your part. You set smart due dates and enforce them. Price your products and services so they’re both reasonable and profitable. Accept online payments.
But are your invoices working for you here? QuickBooks Online provides sales form templates that you can usually use without modifying. But it also offers tools that support multiple kinds of customization. It helps you shape the content and appearance of your invoices and their accompanying messages to be consistent with your company’s brand.
These may be cosmetic changes, but they can affect the way customers react to communications from you. You have few chances to make an impression, so anything you can do to enhance and personalize every interaction will have impact on their impression of you. Neat, well-designed sales forms convey professionalism and attention to details.
Here’s a look at what you can do.
Editing Fields
Unless you use every single field in QuickBooks Online’s default sales form template, your invoices will look sloppier than they might otherwise. The site gives you control over much of the content that your customers will see. To make changes, click the gear icon in the upper right of the screen and select Account and Settings, then Sales. You’ll see Sales form content in the left column. Click on any of the fields to the right to open a more thorough list of options.
QuickBooks Online lets you turn fields on and off in your sales forms and specify other preferences.
Click on the status (On, Off) in the right column to change it. When you’re satisfied with your selections, click Save. Then close that window by clicking the X in the upper right corner.
You have more options than these. Click the gear icon again, and then Your Company | Custom Form Styles. You’ll see that there is already a “master” form. You can either edit it or create a new one. We recommend leaving the master form alone so you always have a clean copy to consult if you get tangled up while you’re working.
Click the down arrow in the New style box in the upper right and select Invoice. In the screen that opens, enter a descriptive name for your template in the field at the top and then click Content. A graphical representation of your invoice will appear in the right pane, grayed out. It’s divided into three sections: header, footer, and table (the middle of the invoice where you describe what you sold). Each displays a small pencil icon on the right side of the screen. Click the one in the middle to make that area more visible.
It’s easy to specify which fields should appear on your invoices, what the labels should say, and how wide the space should be.
As you check and uncheck boxes to indicate what content should be included, your invoice on the right will change to reflect your actions. You can Preview PDF by clicking that button in the lower right. When you’re satisfied with the changes you’ve made to all three sections, click on the Design tab.
Changing the Look
You don’t have to be a graphic artist to have QuickBooks Online forms that look attractive and consistent, which highlight your brand. The site provides tools that give you control over the appearance of your invoices, not just their content. Click each link below the Design tab to:
- Choose a template.
- Add your company’s logo.
- Select a color scheme and fonts.
- Change the printer settings to accommodate letterhead, for example.
Choosing Your Words
You have control over the messages that go out with your invoices.
Finally, click the Emails tab. Options here let you customize the emails that are sent to customers along with their invoices. Again, changes you make in the left pane will be reflected in the graphical version on the right side.
When you’ve completed all of your modifications, click Done.
We gave you this whirlwind tour of QuickBooks Online’s invoice customization options so you’d know what was possible. We expect you might need some assistance when you sit down to apply the concepts you’ve learned about to your own company’s sales forms. We’re available to help you present a polished, carefully-crafted image representing your brand to your customers.
The dumbing down of everything
We live in the information age.
We can ask Google (or Alexa) anything. What gets too little time is fact-checking. Advice is requested in Facebook groups and taken at face value without checking the credentials of those offering the advice. Companies like Intuit and Freshbooks are actively dumbing down accounting. Freshbooks is advertising they are making accounting “approachable,” quite literally undermining the accountants they ask to join their partner program to help sell their products. What hasn’t changed is generally accepted accounting principles, GAAP, which is the rule book all accountants follow. No matter how pretty the screens in Quickbooks, 17Hats, Xero, Dubsado, etc., GAAP is GAAP. Period.
Let’s do some myth busting. Continue reading
How Does QuickBooks Online Handle Mobile Expenses?
If you purchase several items and services away from the office, QuickBooks Online can help you record them while you’re out and about.
QuickBooks Online’s mobile app, available at the Apple App Store and Google Play, can do many of the same tasks that it performs on your office desktop. You can, for example:
- Check account balances.
- Add and edit estimates, invoices, and sales receipts.
- Add and edit customers, vendors, products, and services.
- Record invoice payments.
One of the most common uses of the app, though, is the recording of expenses. Rather than coming home from a trip with your briefcase stuffed full of receipts and notes about purchases you made, you can document them on the road using your mobile device. When you get back to the office and log on to QuickBooks Online, they’ll all be there.
The funny thing about owning a business.
The funny thing about running a business today is that you can feel pretty invincible. After all, you can ask Google any question you have on any topic. If you don’t feel like consulting Google, you can pop into your favorite Facebook group and post your question and sit back and wait for the answers to appear. Perhaps you thought you knew the answer to your question but wanted confirmation.
The problem is that it’s easy to pick the answer from Google that you want. The Facebook group that chimes in to answer your question is a group of like-minded people just like you. Continue reading
How to Hire An Accountant that Won’t Wreck Your Business
This post has been a long time in the writing. It is controversial but I believe this must be said. I’m not writing this to put down every accounting professional out there because I think you should only hire me. While I likely have the expertise to help your business, I may not be the best accountant to work with you for various reasons. I’m okay with that. There are some great accountants out there and I’d like to help you find the right one for you.
Change is inevitable, but that doesn’t mean all change is good. I confess that I am angry with my chosen profession over some of the changes I’m seeing because I believe the changes don’t benefit you, the business owner. In fact, I think some of the changes are hurting you and that’s why I wrote this.
Technology has brought automation to bookkeeping tasks, especially data entry. Automation can help with consistency. Does that mean all bookkeeping tasks can be automated? Absolutely not. Running a business is complicated. Yet there are those perpetuating the myth of the effortless, automated (via technology, not outsourcing) business. If your business could be fully automated, how would you stand out to customers? What would make your business special? But I digress. Continue reading
Which accounting software?
The truth is that your bookkeeping is a nightmare because you ignore it until the last possible moment.
The fact is that your accounting software should be chosen, set-up, and used on a daily basis to provide awesome service to your clients. Done correctly, your bookkeeping will show you the results of every business decision in the form of net income on your income statement, not to mention avoiding that surprise tax bill.
When it comes to choosing accounting software, many businesses do little, if any, homework before jumping in and buying software. After all, you only need accounting software so you can crunch numbers for a tax return, right? Absolutely not. Accounting software is the foundation of your business. It helps you serve your customers better and shows you the results of every business decision you make.
Is there a perfect accounting software that I recommend every business use? No. I don’t believe in one size fits all solutions for any part of a business.
The primary accounting software companies in the small business sandbox are Xero and Quickbooks. (Full disclosure: I’m a partner with both.) If you bought Quickbooks without a second thought, you can thank Quickbooks’ marketing efforts for that. Quickbooks has something like 80% of the small business accounting software market in the United States. Does that mean it’s the best solution for your business? Not necessarily.
Choosing and set-up your accounting software for your ideal client is how you simplify your bookkeeping.
What you are selling, to whom, and how you sell determines whether you just created a bookkeeping nightmare.
Products
If you have physical inventory to keep track of, Quickbooks Online has those features. However, if you are selling inventory on multiple channels, Quickbooks can’t handle that and you could find yourself overselling products. Xero has very basic inventory management.
If you are selling physical products on multiple channels (Amazon, E-bay, Etsy, etc.), you’ll need a third-party add-on to accurately keep track of your inventory. If you sell your product in person and online, you need a third-party add-on app with point-of-sale and multi-channel inventory features.Both Quickbooks Online and Xero integrate with numerous inventory add-on apps. The software you use must integrate with your accounting solution otherwise you just created a time-consuming bookkeeping nightmare.
Businesses that sell physical products tend to have more complicated bookkeeping because of the inventory management and sales tax requirements. However, there’s plenty you can do to keep your bookkeeping from looking like something from a horror novel.
If you are selling physical products, especially on multiple channels, I strongly recommend taking a look at TaxJar to help manage your sales tax.
Services
If you are selling services and digital products, how you sell is determined by your ideal client. If your ideal client is large corporations, you need flexible invoicing to accommodate their requirements or payment will be delayed.
Quickbooks Online only offers their merchant service for online payments. Personally, I wouldn’t use it because of the horror stories. When they still owned Intuit Payment Network, Intuit mysteriously held a payment for almost two weeks and refused to provide any explanation. I stopped using Intuit payment services that very day and haven’t looked back.
Xero connects to various payment services such as PayPal, Stripe, and Authorize.net. While automatic recurring payments are not possible in Xero, your invoices can be set-up as recurring and all are sent with a “pay now” button. Invoices in Xero are very customizable and you can have several templates for different needs. Quickbooks Online allows only one invoice template.
Quickbooks Online and Xero both have the ability to create a simple estimate. Both allow you to set up numerous invoice items to use as standard text. If you need more complex, professional-looking proposals with cover pages, images, etc., you’ll want to look at add-on proposal apps such as Quotient. Be sure to choose an app that integrates with your accounting software of choice. Why? Because when the client accepts the proposal the app can automatically push that proposal to your accounting software and create an invoice.
This is just the start to comparing Xero and Quickbooks. The bottom line is that you should choose the accounting software that will do the best job of supporting how you will do business with your ideal client.
Would you like help with your software? Get in touch.
3 Mistakes Business Make With Their Finances
1. Waiting too long to set-up accounting software
Many businesses wait until the second or third year of operations to set up a bookkeeping system. One reason is the realization your business has a good chance of making it. Another reason is that it’s time to apply for a business loan and the bank asked for financial statements. Sometimes books are set-up because it’s stressful not knowing the financial health of your business. Or maybe multiple years of tax returns must be filed. Continue reading
Is your business ready for a disaster?
The historic storm on the east coast brought this question back to me. Think about it. If everything in your office were lost to fire or flood, how would you continue your business? By everything, I mean all computer, files, and papers.
How would you pay your employees or vendors?
How would you know which customers you owed orders to? Or how would you communicate to your customers that you are still in business at all? How would you get replacement inventory?
How would your employees know whether they still had a job?
If your business is leveraging cloud technology, these questions are easy to answer if you take the time to do some preparation. Paperless timesheets and online payroll processing make paying employees on time a breeze.
Whether using your online banking on the “pay now” button on vendor invoices, paying vendors on time is a breeze. If you have a higher volume of transactions, there are a number of other options to pay vendors electronically.
Using cloud-based accounting, project management, and CRM solutions will ensure you and your team can work from anywhere. Cloud-based email such as Office 365 or Gmail means you stay in touch with employees and customers.
They key to seamlessly keeping your business operating during a disaster is planning. Now is the time to get the right tools in place and prepare a disaster recovery plan that is communicated with your employees. Don’t let a disaster be the end of your business.
