Several years before, if one wanted to start his own business, his natural course of action would be to do it on his own, depending largely on his business instincts, limited know-how, and observation of the market. The advent of franchising, however, brought a big change in business. Many have since become rich because of franchising. Franchising has indeed many advantages.

Modern franchising came to prominence with the rise of franchise-based food service establishments. This trend started as early as 1919 with quick service restaurants such as A&W Root Beer. In 1935, Howard Deering Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise. The idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee.

The growth in franchises picked up steam in the 1930s when such chains as Howard Johnson’s started franchising motels. The 1950s saw a boom of franchise chains in conjunction with the development of America’s Interstate Highway System. Fast food restaurants, diners and motel chains exploded. In regards to contemporary franchise chains, McDonalds is arguably the most successful worldwide with more restaurant units than any other franchise network.

Some of the advantages to owning a franchise can be:

You Own the Business – A franchise is a duplicate of a successful business concept. The franchisee owns the outlet, therefore, he hires his own employees and oversees the management its day-to-day operations. He has high stakes in the business because his money is involved.

Ready Market – When one buys a franchise, he is buying an established concept that has a good record of accomplishment. The franchisee is allowed the use of the company’s trademark and brand name. Because of this, the company is, in effect, giving the franchisee a license to market its products carrying a brand that is already familiar with the consumers. Many popular franchises have instant brand-name recognition and have created a loyal following among consumers. Therefore, the franchisee is getting into a business that already has a ready market.

Continuous Support from Franchiser – Although running his own business, the franchisee can tap the services of the parent company anytime he needs assistance. The services of the head office organization are available to him, too, whenever he needs help. Furthermore, many companies have field operations personnel whom the franchiser can call on to help him deal with any problem he may encounter in the operation of the business.

Most franchises being offered nowadays are turnkey operations. Upon the signing of the franchise agreement and payment of the franchise fee, the franchisee receives the equipment and supplies required in running the business. Furthermore, the franchiser provides assistance in identifying a good business location for the new outlet. The company assists the franchisee in negotiating his lease, preparing plans for outlet layout, shop fitting, and furnishing his store. It also provides assistance in determining the appropriate stock inventory for the opening of the business. This kind of support and the other benefits under the franchise agreement is what sets franchising apart.

Matthew Anderson is the founder of The Franchise Shop website which specialises in accountancy franchises for sale and is an accountancy franchises expert in the UK

Accounts payable is found in the credit side of a company’s balance sheet statement. It represents short – term liabilities. Differentiated from mortgage payables, accounts payable is a debt to be paid in no more than one year. So, every account payable item is liquidated in less than one year. Mortgage payable on the other hand is debt with maturity or payment term exceeding one year. Accounts payables are part of the company’s current liabilities.

The importance of accounts payable explains how one business should handle or manage its creditors. In manufacturing firms, these are usually the supplier of materials. Some may view this accounting term as straightforward. What is understood by a layman – it is a debt to be paid at a given maturity. This is treating it as an ordinary personal credit, which is not supposed to be the case.

There are some accounts payable that can be conceived in the light of a personal loan. Examples are utilities such as telephone, electricity, water or even credit cards. These are uniform in treatment of the company – you have the amount and the due date which usually fall on the same date every month. Recording of this account in the company’s books may be handled by a different employee. When paid, the amount of payment will be treated as expense and the issuance of payment in form of checks are handled by another employee, maybe officer of the company.

The accounts payable must be treated with relative care. Scrutinize the provisions. Very common payment terms are similar to the following: within 30 days, net 30 or 2/10 net 30. Within 30 days implies that the account payable is to be paid within 30 days; 2/10 net 30 is a provision that allows for discounts. This 2/10 is a discount option where-in the supplier gives a 2 per cent discount when the amount is paid within 10 days but needs to be settled in 30 day time without discount.

Crucial to the treatment of accounts payable is monitoring the due date of each of the accounts payables. There are payables that even penalizes when payment is not done on the stipulated due date. With this, the firm may encounter additional expense instead of having accrued savings.

Even if your business is a small one and you do the payments to creditors by yourself, it is better still to understand and have familiarity with common payment terms. No matter how small the discount offered by a creditor, any amount is still a considerable savings when taken in the long run. Most of all, the accounts payable is an indication of billing process, something which is important in setting up a business.

Accounts payable will always be a part of a business financial statement. There will always be creditors and even simple utilities will be part of this account.

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The Office of Professional Responsibility (OPR) has prevailed in an agency appeal involving issues which include the due diligence responsibilities of a CPA under the Rules of Practice before the IRS (Circular 230). The May 28th decision of the Appellate Authority has upheld the Administrative Law Judge’s (“ALJ”) disbarment of CPA Tim W. Kaskey finding, among other things, that Mr. Kaskey failed to exercise due diligence in preparing tax returns for a corporation and its husband and wife shareholders.

“This is yet another decision highlighting that practitioners have a duty to the system as well as to their clients. Practitioners who do not take this duty seriously can expect to be held accountable,” said Office of Professional Responsibility (OPR) Director Karen L. Hawkins. On review, the Treasury Appellate Authority agreed that disbarment was proper. Mr. Kaskey defended against the due diligence allegations by arguing that his clients had misrepresented their income to him.

Mr. Kaskey is a CPA and tax advisor who also prepared individual as well as corporate tax returns. OPR alleged that Mr. Kaskey failed to exercise due diligence under Circular 230, section 10.22 when he failed to determine the correctness of the representations he made to the IRS on the tax returns of a corporation and its married shareholders.

OPR also alleged that Mr. Kaskey’s misconduct included a failure to comply with the requirement to advise clients of potential penalties and any opportunities to avoid such penalties by disclosure contained in Circular 230, former section 10.34(b) (now section 10.34(c))

When Mr. Kaskey failed to respond or appear at the administrative proceeding, the ALJ deemed the allegations against Mr. Kaskey admitted and entered a default judgment for disbarment. Mr. Kaskey appealed. On review, the Treasury Appellate Authority agreed that disbarment was proper. Mr. Kaskey defended against the due diligence allegations by arguing that his clients had misrepresented their income to him.

The Appellate Authority observed that there was “a great deal of evidence reflecting the lack of due diligence by Mr. Kaskey in the preparation of these returns and that “it was inconceivable that the individual taxpayers could pay their living expenses based on the income reported on their returns.”

“Practitioners who think OPR isn’t serious about due diligence should take heed,” added OPR Director Hawkins. “Practitioners may not ignore the implications of information already known, and must make reasonable inquiries if the information furnished by a client appears to be incorrect, inconsistent or incomplete.” The Appellate Authority’s and ALJ’s opinions are available on the IRS Website; search “OPR”.

Rizzolo Group has many years experience helping small business owners decrease taxes and improve profitability. You need the right financial data and the right tax preparer who knows accounting bookkeeping, payroll services and gives you timely advice. Rizzolo Group does that!

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When purchasing software tools for medical offices, make sure to find one with an appointment scheduler and that it keeps track of patient’s records. With today’s technology, there is no reason not to make things simpler and more organized in the medical office. This is exactly what busy physicians need to keep their practice in order. Doctors and nurses want to spend the most time with their patients not their paperwork. The Practice Partner date entry method is one way for health professionals to facilitate tedious data entry.

Organizing records and tracking billing is important to do without complications and stress. The simpler the software is to use and the more time savings it will bring so that doctors can spend more time with their patients. There are many tools, like the Practice Partner software technology, designed to facilitate medical office high demand for organizing patient records and files.

Being more organized will help physicians and their staff be more productive and gives them more time to care for their patients. The technology in this software also supports speech recognition and this feature can be used if desired.

When entering patient data, medical information, and billing there is no need to open each chart if the medical office has the right technology and resources available to them. The first step is to enter the information in one chart and then the software will update each chart automatically saving time. With today’s technology, more than one person can view records and information at the same time. Virtually everything that a practice needs to operate smoothly is provided in the software. It has the capability to inform physicians of lab results, upcoming appointments, medication allergies, and much more.

Other software options out on the market today, Lytec is another example of easy to use medical billing software that many office assistants and nurses use. Vital office needs can be taken care of such as keeping track of everything such as appointments, insurance information, and patient billing. Nurses appreciate having an elite appointment scheduler that allows the staff to book multiple appointments and schedule and cancel appointments with ease. Another capability nurses need in running an office smoothly is the ability to notify the staff when co-payments are due at the time of the appointment as well as balances that are past due. Nurses understand that patients needs’ come first and they always come out the winner because they get more attention than the paperwork!

Another important consideration before purchasing software is: does it offer installation for a single user, or multiple users in a busy office? It’s important that staff is knowledgeable and can offer technical assistance for Lytec software. Because when the time comes, it’s going to make a big difference when you can call support for help.

Pageviews works with Lytec and Practice Partner. Practice Partner
Medical Billing software has all your medical billing and records needs for the healthcare office, at an affordable price. For more information about Practice Partner or Lytec, visit http://www.azcomp.com.

To a business owner, the most important documents he wants to lay his eyes on are the financial statements. These documents are reports – on the performance and the result of business operations. This measures the profitability of the company as well as the gains in investment. This report, otherwise, called financial statements comprise of three important parts – the balance sheet, the profit and loss summary which is also called income statement and the cash flow. These three accounting documents will show the true and complete picture of the business.

The balance sheet is a reflection of the firm’s assets, liabilities and owner’s equity at a specific time. This is usually at the end of the accounting period, commonly on the midnight of December 31. The income statement is an indication of business profitability at a specified time – this could be the whole accounting period or a fraction thereof, say 3 months or quarterly. This will reflect the total revenues and expenses during any given period. The cash flows would indicate the change in cash and cash equivalents. The cash equivalents are divided into three categories – operating activities, investment activities and financing activities.

Who are interested in seeing the financial statements?

The business owners would want to look at the financial statements. This will tell them how much were the profits generated for the past business operations. This will also quantify the additional amount earned and re-invested. The balance sheet can give them an idea of possible expansion given the current resources. The income statement or also called profit and loss summary will indicate the amount of company earnings. And the cash flow will tell owners the amount which readily convertible to cash.

Creditors or lenders especially the banks, are so much interested in the performance of the business. There are times that the bank would require a complete financial statement for the past 3 or 5 years. The documents will serve as the basis for analyzing the need for financial assistance and the decision to grant loans to the company. Seldom would a bank extend credit to a losing company.

Suppliers of the business will also be interested in taking a look at the statements. This will enable the suppliers to gauge the capability of the company – would the firm be expanding to merit more supplies?

Investors also would like to see the company’s financial statements because these will indicate the viability of the company. As it earns, it will surely continue with operation and the investments can be made use of.

Finally employees would also want to peep on the financial documents. This will tell the workers their chances of salary increases, grant of benefits and assurance for continuous employment.

Financial statements are really very important – not only to the owners but the general public as well. The documents may look simple but this is a reflection of the condition of the firm.

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Sometimes, a business owner would be in a quandary as to what a balance sheet means. To a business proprietor, his main concern is whether or not the firm is having profit or incurring losses. The balance sheet is left to be less of a concern. So – what is the use of a balance sheet?

The balance sheet is a snapshot of the financial position of a business at one specific time. It demonstrates the financial strength of the company. This can also be a gauge for business expansion. This part of the financial statement is comprised of debits and credits. As the accounting principle goes – “for every credit there is a corresponding debit”. And the balance sheet’s debits and credits are the assets, liabilities and owner’s equity. Under the balance sheet, and under any point in time in the business, the assets should always equal the sum of the liabilities and equity. Assets are the things that are owned by the business which are given monetary values whereas liabilities are the amount due to the creditors. Of course, equity is how much is left to the owner after deducting the amount to be paid to the creditors.

Assets

The assets can have two kinds – the current and the long-term assets. The current asset measures the company’s liquidity position – the amount that can be easily converted into cash within one accounting cycle. On the other hand, the long-term assets are properties that cannot be sold or converted into cash in an overnight period. The current assets are cash, deposits in banks, accounts receivable and notes receivable with a term of one year or less. The long term assets are notes receivable with tern of more than one year, land, buildings, equipments, machinery, furniture and vehicles. The debit side of the balance sheet equation comprise of the sum of the current and fixed assets.

Liabilities and Owner’s Equity

This part of the balance sheet represents all debts and obligations of the business. These can be private or mortgage creditors. Often times this side of the balance sheet is referred simply as liabilities.

The liabilities are classified as current and long-term. The current liabilities consist of the accounts payable, notes payable, accrued payroll and withholding. The long term liabilities which are payable in more than one year is mortgage notes payable.

Owner’s equity, also referred to as stockholder’s equity, is composed of the initial investment to the business plus all the earnings of the business which were re-invested in the same business.

The total liabilities and equity is the credit side of the balance sheet equation.

Total balance sheet which may not be a major concern for business owners is equality between the assets and sum of liabilities and equity. This is a reflection of the financial condition of the firm.

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What ties all businesses together, no matter what they deal with? Accounting, of course it’s literally the backbone of every business. Solid, professional accounting gives a business a clear image of where it is at this moment, and lets the financial managers make informed choices on the future of the business. Accounting is also a profession that dates back literally thousands of years. Evidence of accounting procedures even date back as far as the days of the Pharaohs and Ancient Egypt.

The root of accounting actually is bookkeeping no real surprise there, though many people don’t think about it much. What a bookkeeper does is track all of the money that the business handles, both incoming and outgoing. A bookkeeper ensures that the ‘books’ are balanced properly, and the records are clear and in order. A bookkeeper also handles information regarding payroll, bank statements, ledgers, and even information regarding real estate and investments the company itself has.

Another aspect of accounting is auditing, which protects the employees, owners, and investors of a company from any sort of accounting fraud or ‘mistake’. An audit is usually performed by an outside company to maintain a lack of bias. What an accountant does during an audit is go through all of the financial records of the company, including the ledgers, to figure out an accurate financial picture of the company. If the ledgers the company holds don’t match the bank statements, then the accountant realizes that there’s something wrong and it’s their job to figure out what. Sometimes this means discovering that someone has been helping themselves to company funds, but other times can just be correcting a harmless error.

Yet another part of being an accountant is compiling and analyzing the company’s financial situation, and creating reports based on this to be distributed throughout the company. With these statements, along with personal dealings, the accountant can give recommendations on investments, if the company can afford the direction it desires to go in, and more. Part of this also includes reporting to various government agencies.

So, how many accountants does one company have? It depends on the company, no surprise there. Most of the time, the main accountants are certified public accountants, who have to pass a test given to them by the state in order to work as an accountant. A business will often also employee bookkeepers, and the accountants can oversee accounting training. Most of the time, a single accountant will oversee the entire department and this role is vital to the company, as this is usually the person that meets with investors as well as the companies head, and is responsible if anything goes wrong.

Tired of trying to figure out where the money is and where it should go? Let KJ Accounting and Consulting Group, a Farmington bookkeeping firm, help you with your accounting and book keeping needs. We have set up My Simple Accounting as your one-stop resource for our consulting services, trainings and products to help you with all of your accounting needs.

As a small business, you’re going to experiment with a lot of different software for accounting, money management, business development, and more.

The two more popular programs, QuickBooks and Simply Accounting, have numerous different features. They’re both very similar, but we’re not looking at their similarities, but the differences that make these programs different from one another. That’s the best way that you can figure out what’s right for your company.

In this article, we’re going to be talking about the Pro versions of these softwares.

Multi-Currency
If you’re going to be doing dealings with other countries, or if you’re an international company, being able to keep records in more then one currency is the optimal choice. A software that isn’t may actually be useless.

The Pro version of Simply Accounting comes with two currencies already in it, and versions other then the First Stage version have unlimited currency capabilities (The First Stage version only offers one base currency, nothing more).

QuickBooks Pro only offers one base currency when purchased both in store and online, and you can’t expand on it. If you need two currencies, you have to contact the company directly and purchase QuickBooks Multi Currency Premium, the only Quickbooks software that offers more then one currency. A major disadvantage of this is that it’s much more expensive then the Pro version Quickbooks, but it’s the only Multi Currency software they offer. The upside? Premier comes with a 3-user license.

Upgrades
With Simply Accounting, upgrading from an older version to a current version really is quite easy. Even with the multi currency versions, you shouldn’t have any problems upgrading Simply Accounting only the First Stage program will give you any trouble. However, if you’re running an older version of Windows Office, you may have to upgrade to be able to use the upgraded software.

QuickBooks is also painless to upgrade, unless you’re using the Multi Currency version then you could run into serious problems. There isn’t an automatic upgrade to a single currency QuickBooks addition, and if you choose to force the upgrade, you can end up losing details and transactions of any currency that’s not marked as the base currency.

Payroll
Both Simply Accounting and Quickbooks offer payroll services, and the ability to print off payroll checks. However, this isn’t included in the base software instead, it run on a subscription for both, and these rates change. For the best price estimate, check with the companies themselves.

Reports
Probably one of the easiest things to do in Quickbooks is to send invoices, sales, estimates, and other reports. All you have to do is press the ‘email’ button, and a .pdf file is created. Outlook is started, and it’s all ready to be sent off.

Simply Accounting uses the system Crystal Reports to make any sort of report. It’s not sold with the Simply Accounting software, but is free to use for all Simply Accounting customers all you have to do is call the company, and they’ll send you a copy of the Crystal Reports CD. You do have to pay shipping.

The main problem with Crystal Reports isn’t that it doesn’t work. It’s that it’s not user friendly at all, and it’s hard to get used to. If you’re looking for an easy way to make reports, this isn’t it you can take a class or get a book to help you,

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I am sure we are all aware of the standard definition of reconcile but what does it mean when we are talking about money, and more specifically, about money in the accounting field?

Well, reconciling is a pretty basic accounting procedure where the accountant’s records are compared with the bank statement of the company to see if everything ‘checks out’ or if the numbers match. Sometimes, a discrepancy is apparent, but it is only because of the time difference. For example when something has not been recorded yet or when things have been recorded on one but not the other and then there is an issue.

Sometimes if an outside accounting is reconciling, they will not realize that the business is using a system different from GAAP, or the generally accepted accounting principles. The majority of businesses do follow GAAP (There are books upon books about the GAAP system), so much so that it is presumed unless stated otherwise. If these principles are not used, it can be very easy for the person reading the documents to not understand what they are looking at, or worse presume they know and report something incorrect to the company.

Think of GAAP as the standard of standards. No one really uses anything else and not disclosing that it does makes the company legally liable for any misunderstandings associated with it. After all, it’s not like someone just tossed together the rules of GAAP in a night and said ‘I guess this works’!

But it is not all cut and dry. The G in GAAP does stand for general, and you have to realize that these guidelines can be open to interpretation. Sometimes this can lead to creative accounting, which I am sure you’ve heard of before.

Creative accounting, or massaging the numbers, is when a business pushes the numbers a little to make the company appear more profitable on paper then it is in reality. It is never right, but this is not always a serious issue. Not unless it gets out of hand. Because this sort of behavior can lead to accounting fraud, or cooking the books (A little salt, some basil…).

The end result of accounting fraud is not good for anyone. Just look at the news what happened to Enron was accounting fraud, and you need to consider that massaging the numbers a little could be the first step to something worse.

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Bookkeeping should never be equated to accounting because bookkeeping is merely a part of accounting. When accounting became computerized, there were apprehensions about the role of the bookkeepers. Will they be purged out and be taken over by machines? Unfortunately not, despite the introduction of computers, manual entry to the machine has to be undertaken. When accounting software came out and was utilized, the same angst was experienced by the accountants. But like bookkeepers, accountants cannot be replaced by the machine, no matter how high tech it is. The computer and the accounting software only facilitated the job.

What is bookkeeping? This process is the recording of all business transactions. It is handled by a bookkeeper who is also called the accounting clerk. This bookkeeper takes custody of the books of the company, but now, the bookkeeper does the entries by mere inputs in the machine.

Bookkeeping is an indispensable part of the business. Without this process, there will be no basis for accounting and no financial statements can be compiled by the accountant. In essence, the bookkeeper is the first step or first level in the gathering and establishment of the business enterprise’s financial data.

The system usually employed by the bookkeeper is the double entry system. The main responsibility of this accounting clerk is to record in the books all the transactions and also, the same transactions will be recorded in different subsidiary ledgers. After the recording, at the end of the day, upon closure of transactions, this accounting aid will bring the books to the trial balance stage which will eventually be reviewed and checked by the accountant. And from there, the accountant takes charge of the preparation of the income statement, balance sheet and cash flow.

When this transaction recording was yet using manual entries, books, daybooks and ledgers are the main tools of the bookkeeper. He or she painstakingly observes accuracy in the recording, otherwise the books will not be balanced and the financial documents cannot be prepared. The knowledge of this employee on the principles of debits and credit are the foundation of his or her performance of duties for the company. There is no room for error in the entry job and as such it is expected that this financial clerk has supreme accuracy and perfectionism. Otherwise, the books of accounts will not balance.

With the advent of computerization of the accounting system, many books previously handled by the bookkeeper are discarded in favor of the accounting software. It is said that the computer only de-skilled the bookkeeper’s job. The accounting software has been used for quite a time now and this software ensures that not a single entry is omitted or erroneously inputed. The computer only made the job and the balancing of transactions fast but the role of the bookkeeper is still there to stay.

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