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accounting, cash flow

Is there a difference between cash flow and profit?

By on

August 5, 2022

- Category : accounting, cash flow

- Tags : 2021, accounting, accounting software, accouting

Cash flow and profit aren’t the same but are some of the important financial business metrics.

Cash flow is the balance of cash moving into and out of your business at a specific point in time. It can be positive which signifies more money is moving into the business instead of out of it. On the flip side, a negative cash flow signifies more money is moving out of the business.

Profit is the balance after you take total income minus all operating expenses. Just like cash flow, profit can be both positive and negative.

So, what is the difference? Profit is the amount of money left after expenses have been paid and cash flow indicates the net flow of cash moving in and out of the business.

Is one more important than the other? Both are important and have their purpose to help owners understand their business. You need to understand both and how they work with each other to best evaluate your business.

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accounting, business, software

Is the end nearing for QuickBooks Desktop?

By on

July 31, 2022

- Category : accounting, business, software

- Tags : 2021, accounting, accounting software, accouting

A lot of business owners have used QuickBooks Desktop over the years where they would purchase a one-time license. That license would last until they decided to purchase a new version. Last year Intuit / QuickBooks announced they are discontinuing the desktop version in the UK starting January 2023. This will force all UK clients to move to QuickBooks Online or to new software. QuickBooks has stated that the discontinuation of the desktop version in the UK is due to business owners using out-of-date and non-compliant software. Here in the states, they are moving to a desktop subscription model. 


What do you need to do?

If you are in the UK, you will need to move to QuickBooks Online or move to a QuickBooks alternative software before January 31, 2023. I have read articles that some business owners have attempted to purchase QB Desktop through Ireland and it was working for them. My clients are either moving to the online version or they are using this change to move to more robust accounting software like NetSuite. 

If you are in the USA, Desktop will still be around, but moving to a yearly subscription fee. The pricing structure can be confusing and difficult to track down the costs. They still have the three options Pro, Premier, and Enterprise with the option to add on live bank feeds, payroll, users, etc. However, if you keep your current version of the software it will still work but will no longer sync with bank or credit card fees. 


How we can help?

If your business is being impacted by this change or you are considering moving to different software, we can help support your business to identify the best solution for your needs.


For more information or to discuss your accounting software options feel free to reach out.




 

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accounting

Do you run an expense analysis?

By on

July 3, 2022

- Category : accounting

- Tags : 2021, accounting, accounting software, accouting

Are you running an expense analysis each month or quarter in your business? If not:

What: The goal of the expense analysis is to differentiate between costs & investments in daily/regular spending. This is typically the first step when implementing Profit First, as most businesses can cut between 10%-25% of expenses without jeopardizing the quality of service or product allowing the business to ensure they are using the revenue to its highest potential.


Who: Most business owners think they are running lean and there’s no waste. An expense analysis is beneficial even to these businesses, as it either confirms this to be true or sheds light in areas where this is not the case. EVERY BUSINESS MUST RUN AN EXPENSE ANALYSIS QUARTERLY.


Why: It is imperative for each business to do its due diligence to ensure the health of the business. An expense analysis allows the business owner to understand where they are spending, and it drives them to ask better questions surrounding their daily investments to ensure they continuously generate a return.


How: Because an expense analysis is just as emotional as anything else in a business’s finances, we take a different approach to avoid an extreme case of loss aversion, which often leads to unwarranted justification. We accomplish this by reverse engineering into the expense goal for the quarter

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business

Writing standard operating procedures in 16 steps

By on

January 18, 2022

- Category : business

- Tags : 2021, accounting, accounting software, accouting

Writing SOPs doesn’t have to be hard. If you follow these great steps from PROCESS ST

  1. Understand how you will present your SOPs. This step is about choosing your template to fit the needs of the process. In certain industries you will have requirements which you need to adhere to. The layout of your SOPs will be influenced by the kind of information you need to display. Investigate which international standards apply to your business operations.
  2. Gather the relevant stakeholders. To properly map the processes in use within the company, you need to have relevant members of the company present. These standard operating procedures must reflect reality so that they can be adapted and optimized to improve reality.
  3. Work out your purpose. Are you documenting your standard operating procedures in order to adhere to industry standards? Or are you confident your operations already adhere, you just need to document them? Are you doing this out of a general process optimization push? Knowing the answers to questions like these will help you prioritize your approach.
  4. Determine the structure of your SOP. There are different forms a SOP document can take. Before beginning one, understand whether this is to be a manual, a mini-manual, or a procedure document. The larger your company, the more likely it is you’ll be creating an incredibly in-depth manual.
  5. Prepare the scope of the procedure. If you’re mapping only one procedure within the document you are working on then you need to understand exactly where the procedure starts and where it finishes. It is important to clearly define the scope in order to reduce overlap with other procedure documents. Not doing so would lead to inefficiencies.
  6. Use a consistent style. This is more writing advice, but you need to think about the purpose of the document to understand how it should be written. If this is a document used solely for demonstrating to the industry that you have documented SOPs, then maybe the language will be technical and trite. However, if workers are going to be using this document as a reference point, then you’ll need to make the language clear and actionable.
  7. Use correct notation, if applicable. There may well be standardized forms of conveying processes within your company, but if not you could begin to implement them. Business process model and notation provides a universal way to explain processes in a concise visual style.
  8. Work through all the necessary steps of the process. Assess the process from start to finish and note down each task required along the way to complete the process. This can be done in the form of a bullet point list with pen and paper or a note-taking app.
  9. Try to assess potential problems in the process. If you’re looking to improve your process as you work through your documentation, now is a good opportunity to do so. Assess the basic steps you have recorded and ask if anything else could be added or removed. If something were to go wrong in the process, where would it occur? Where does it currently occur in real life?
  10. Determine metrics against which SOPs can be judged. This is a great opportunity to make your standard operating procedures actionable and to find a way of assessing their positive impact. What metrics you choose to use will depend on the process you’re documenting. The key metrics may be related to performance or speed or a formula utilizing both of those variables.
  11. Test the process. To make sure the standard operating procedures you have documented are the most effective, test the process with the employees who undertake those tasks on a day to day basis. Make sure they are able to give feedback on the procedures presented so that you can make alterations to the process, procedures, or simply the document style before submission.
  12. Send the process to superiors. Submit your process for review by your line manager. Alternatively, if you do not have a line manager, find a colleague whose feedback you value and send the SOP document to them before declaring it to be complete.
  13. Clarify the method of optimizing the process. A standard operating procedure document should track its own revisions over time. However, it is useful to have a general system in place to govern these revisions and how and when they occur. Creating a process for process optimization is an effective means of delivering this iterative change.
  14. Run a risk assessment on the process. A process involves people or data or something somewhere which can be hurt, damaged, or lost. Make sure to run a risk assessment on your processes to make sure you’re not opening up your company’s risk exposure.
  15. Consider creating a flow diagram. A visual aid to help other people understand the overview of the process will prove useful for people both assessing and following the process presented in the standard operating procedures. Including one increases the user friendly level of the document.
  16. Finalize and implement the SOPs. Once all participants and stakeholders have signed off on the document and people have agreed to its use, implement the standard operating procedure document for the necessary process and file the document appropriately.
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business, software

Apps Every Small Business Needs

By on

January 10, 2022

- Category : business, software

- Tags : 2021, accounting, accounting software, accouting

 

I get asked all the time by small business owners what apps they should be integrating into their business. There are a variety of articles out there talking about the top apps for the year.

Here are the Apps we recommend:

 

Communication

Slack

This team communication tool gathers group exchanges into one place, making information instantly available and searchable wherever you go. This cloud-based collaboration application began as an internal tool used by a now-defunct online game. SLACK is currently the fastest-growing B2B application, used by over 4 million active users every day.

Loom

Loom is a great way to capture videos to share with your team or clients. It can easily be integrated with Google Chrome and other applications like Trello, Google Docs, Basecamp, JIRA, Dropbox, Salesforce . Any video you record can be watched directly where it is shared.


Email

Google Suite

It is designed for your workplace and has everything you need in one place which makes working with your team a whole lot easier. You can collaborate in real-time with teammates or clients through documents, spreadsheets and slides. The ability to store and share files in the cloud gives you the ability to easily invite others to view, collaborate, and download.

Office 365

Whether you’re working in your office or on the go, you get a familiar, top-of-the-line set of productivity tools. Office applications —always the latest versions—let you create, edit, and share from anywhere in real time. 1 TB of storage per user, HD video, content sharing, shared calendars, and team chat.

 

CRM

Salesforce

Salesforce was created to take the hassles out of sales, service, marketing, and more with no software and no headaches. It can be integrated with 2,800 different apps. It can streamline processes and workflows with simple point and click power, so you can focus on customers.

Hubspot

HubSpot’s CRM platform has all the tools and integrations you need for marketing, sales, content management, and customer service. Each product in the platform is powerful alone, but the real magic happens when you use them together.


Project Management

Smartsheet

Smartsheet is the only platform that can scale from a single project to end-to-end work management, connecting business on a no-code, cloud-based platform where anyone can create the solution they need — backed by the control and security IT requires. Smartsheet is a software as a service offering for collaboration and work management, developed and marketed by Smartsheet Inc. It is used to assign tasks, track project progress, manage calendars, share documents, and manage other work, using a tabular user interface

Monday

Monday is a project management app that clearly organizes all tasks and boosts team communication. Just create a project, add tasks to the said project, and finally, add steps to each task. As employees complete a task or steps of a task, the status is updated so everyone can easily see where a project or task currently stands. In addition, users can create knowledge bases to store documents and anything else project related.

Trello

Trello is collaboration tool organizes your projects into boards, lists and cards so you can better prioritize work and life. At a single glance you can see what’s being worked on, who’s working on what and where in the process a project is. It makes project management–which can include work assignments, family chores or travel plans–easy and enjoyable.

What apps are you using in your business?

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