Whether your business is a sole-proprietorship, partnership, corporation or a limited liability company, whether you operate a small automotive shop or a large manufacturing plant, proper accounting and financial reporting is a critical part of managing your business for success. Let's look a some basic parts of the accounting system to better understand its importance.
Accounting has been called the language of business. So what is accounting? "Accounting is the recording, classifying, summarizing and interpreting of financial events and transactions to provide owners, management and other interested parties with the information they need to make good decisions."
There is your basic definition of accounting and as you can see it sounds pretty simple right? But what exactly does this mean to the average Joe? We'll without making you read a book here let me explain in simple terms. When a business transaction occurs, say the business receives a payment for a job it completed the business received "revenue", and this needs to be recorded same as if the business made a purchase of equipment or material, these are events which get recorded in a journal. Now a journal can be as simple as a notebook except the entries made must use the double entry method. GAAP requires this and more importantly the IRS frowns on single entry accounting methods. So what is recommended? QuickBooks to the rescue! QuickBooks is an accounting software used to record business transactions utilizing the double entry method we need to adhere to. In QuickBooks we can record all of our business transactions, maintain a customer and vendor list, keep track of owners equity and compile managerial and financial reporting. What is managerial and financial reporting you say? In simple terms they are the heart of a business, so lets look.
Managerial accounting is used to provide information and analyses to owners and managers within the organization to assist them in decision making. Such as measuring and reporting costs of production, marketing and preparing budgets.
Financial accounting is used by people outside of the organization such as creditors and lenders, employee unions, customers, government units and the general public.
The point I am trying to make here is the importance of an accounting structure within a business and how even a small entrepreneur needs to maintain at least a minimal record of accountancy for not only the survival of the business but also to protect the owners from tax penalties and interest.
Professional Tax Service offers complete accounting services or in-house or on-premise training for Quickbooks and PeachTree accounting programs.
Bringing Your Company Inline
Generally we start with setting up a company's QuickBooks file and build a chart of accounts to bring your beginning balances over to. A chart of accounts that is unique to your trade or business with your company's parameters, this is where all your journal entries will be posted or recording to which makes it an important part of the integrity of your accounting system. GAAP procedures and tax law on both the Federal and State level must be considered in properly establishing these accounts. Beginning balances will be brought forth with your existing customer and vendor information along with equity, assets and other accounting information.
Getting Your Company Started
Once your system is in place we can train you and or your company's staff in daily accounting tasks. Using QuickBooks the proper way through established procedures ensures your entries are categorized properly.
We will then keep a close eye on your entries either monthly or quarterly ensuring you are on track and staying current with certain liabilities your company will obtain throughout its life.
Generally during the course of your business operations we will handle all your tax reporting requirements, at least until you get familure with each one and are able to do them on your own if you prefer, tax reporting requirements have to be completed properly in timely manners to avoid excessive penalties and risks, so we can take care of them until you are ready.
These tax reporting requirements are generally:
Tax Reporting Requirements