Your address will show here +12 34 56 78
accounting, cash flow

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.

0

accounting, business, software

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 QuickBooks has stated that the discontinuation of the desktop version in the UK is due to business owners using out-of-date and non-compliant software.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.




 

0

accounting

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

0