I heard this advice at the JumpStart EXPO from a very successful entrepreneur. When it comes to small business bookkeeping there are two things a business owner should never do:
As the CEO and founder of BudgetEase, an outsourced bookkeeping service in Cleveland, Ohio, I meet with hundreds of small businesses each year. As prospective clients weigh their options when choosing a partner for their bookkeeping, I often get asked who do I respect in the region.
When is it time to hire a CFO? I spoke to Tom Gentile, partner at part-time CFO firm BeaconCFO Plus in Cleveland, to find out. According to Tom, reaching a certain size is not the indicator. Situations cause the need for a CFO. Here are some he mentioned:
As a real estate agent, you are more than likely paid as an independent contractor. Tracking your income from commissions and fees may be easier (and more rewarding) than tracking all the tedious expenses you incur each year.
Business owners often determine their cash balance by checking what the bank shows online in the accounts at a point in time. You cannot accurately forecast cash flow unless you match and verify activity in the bank statement to QuickBooks or whichever accounting system you use.
Just as important as a proper P&L Statement, business owners should put equal weight on having an accurate balance sheet. Some owners find it challenging keeping the accounts in this report correct. The simple formula on the balance sheet is: assets = liabilities + owner’s equity. Knowing your business’s real net worth is about more than just balancing.
As a business owner, cash in and cash out of your bank account may be the primary focus. However, the true definition of a profitable business is determined through consistent tracking of each client, each sale and all related expenses.
At BudgetEase, our motto is: Making YOU Profitable. How will you know YOU are profitable? You need solid financial reports in order to answer this question. BudgetEase can turn your financial information into a set of reports you can count on.