A Matchmaker For Accountants

When launching a new business, you need a trusted bean counter in your corner. Though finding a good accountant may not be as onerous as doing your own taxes, it's certainly no picnic. Firms spend plenty of time and resources in the search for solid financial advice. But rather than shuffling off to Google, there may be a better way to land some much-needed assistance before you're knee-deep in bills.

Teaspiller, launched in 2009 by former Travelocity vice president Amit Vemuri, is an online database and accounting platform that connects users with qualified professionals. The New York City-based startup can be used to comparison-shop from more than a million listings of accountants and tax-return preparers culled from the internet, public listings from CPA state boards and the IRS' official database of enrolled agents who are licensed to represent taxpayers before the agency.
"For a lot of small businesses and individuals, it's really hard to find a quality accountant," Vemuri says. "When you talk to people, a lot of them have found their accountants through trial and error, the Yellow Pages or a friend. But those search costs are pretty high."

What is it?
The name Teaspiller comes from a colonial-era newspaper editorial referring to the Boston Tea Party. The idea, Vemuri says, is to shake up the way the average small-business client relates to and works with their accountant by breaking the process into a few simple steps. The user searches for an accountant in Teaspiller's database, then books an appointment or requests a quote using an online form. If the accountant has an active Teaspiller account, not only can the meet-and-greet process be handled remotely, but the subsequent working relationship can be managed online through the secure Teaspiller platform, which allows for everything from scheduling phone calls and sharing tax documents to billing.

What does it do?
As an accountant search tool, it's hard to beat Teaspiller. Users search by geographical area as well as by the services they're looking for; a simple drop-down menu reveals a comprehensive list that includes everything from basic tax preparation to forensic accounting. Teaspiller then generates potential matches with a Yelp-like listing for each accountant; in many cases the listing includes a rating, the accountant's résumé, links to websites and social media accounts such as LinkedIn, and a breakdown of services offered.
It's all the more impressive when you realize that gathering the same kind of information for the same number of accountants on your own could take hours of web searching and sifting. It's easy to use Teaspiller to pull together at least a basic list of potential accountants so you can proceed to making phone calls or firing off e-mails asking for quotes.
For quick and dirty financial help, Teaspiller also has an Ask an Account-ant feature, which lets users submit questions to accountants in Teaspiller's database. Submitting a question is free, but to guarantee a response, you'll have to pay up: $10 for an answer within two business days; $15 to hear back within one business day.

What doesn't it do?
Teaspiller pulls a huge chunk of its database from the IRS' list of enrolled agents and sets up basic accountant profiles until individual accountants claim them and start filling in more details. Therefore it's quite possible that your search results will pull in accountants who aren't using Teaspiller's remote accounting functions (Vemuri says that's up to the accountant). That may not be a bad thing, because it's likely not every small-business owner will feel comfortable doing sensitive accounting work over the web, even though Teaspiller assures users that its sharing platform is secure.
There is also the ratings game. At this point in Teaspiller's development, most accountants don't have user ratings, and the ones who do only have a couple. Accountants are assigned a Teaspiller rating, which takes into account years of experience and professional licenses. But because Teaspiller vets the accountants it adds to its database, these ratings almost all range from very good to superb. Unfortunately, it just may be impossible to take trial and error completely out of the equation.

The bottom line
While it's not perfect, Teaspiller is a welcome resource for any startup. It's as good a place as any to seek out a qualified accountant or business tax pro.

Read more: http://www.entrepreneur.com/article/222969#ixzz2g0RX7TNC

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Payroll : Elements Of The Accounting System

If you've got employees, you've got to get a handle on payroll, payroll accounting can be quite a challenge for the new business owner. There are many federal and state laws regulating what you have to track related to payroll. Failure to do so could result in heavy fines-or worse.

Many small-business owners use outside payroll services. These companies guarantee compliance with all applicable laws. This keeps the small-business owner out of trouble with the law and saves valuable time that can be devoted to something else in the business.

However, if you choose to do your own payroll, it is highly recommended that you purchase an automated payroll system. Even if the rest of your books are done manually, an automated payroll system will save valuable time and help considerably with compliance. There's not a lot of margin for error when dealing with the federal government!

Excerpted from Start Your Own Business: The Only Start-Up Book You'll Ever Need, by Rieva Lesonsky and the Staff of Entrepreneur Magazine, © 1998 Entrepreneur Press

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Inventory : Elements Of The Accounting System

Unless you are starting a service business, a good inventory-control feature will be an essential part of your bookkeeping system. If you are going to be manufacturing products, you will have to track raw materials, work-in-process and finished goods, and separate subledgers should be established for each of these inventory categories. Even if you are a wholesaler or retailer, you will be selling many different types of inventory and will need an effective system to track each inventory item offered for sale.

Another key reason to track inventory very closely is the direct relationship to cost of goods sold. Since nearly all businesses that stock inventory are required to use the accrual method for accounting, good inventory records are a must for accurately tracking the material cost associated with each item sold.

From a management standpoint, tracking inventory is also important. An effective and up-to-date inventory-control system will provide you with the following critical information:

• Which items sell well, and which items are slow moving
• When to order more raw materials or more items
• Where in the warehouse the inventory is stored when it comes time to ship it
• Number of days in the production process for each item
• The typical order of key customers
• Minimum inventory level needed to meet daily orders

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Fixed Assets : Elements Of The Accounting System

Fixed assets is a elements of the accounting system, fixed assets are items that are for long-term use, generally five years or more. They are not bought and sold in the normal course of business operation. Fixed assets include vehicles, land, buildings, leasehold improvements, machinery and equipment.

In an accrual system of accounting, fixed assets are not recorded when they are purchased, but rather they are expensed over a period of time that coincides with the useful life (the amount of time the asset is expected to last) of the item.
This process is known as depreciation. Most businesses that own fixed assets keep subledgers for each asset category as well as for each depreciation schedule.
In most cases, depreciation is easy to compute. The cost of the asset is divided by its useful life. For instance, a $60,000 piece of equipment with a five-year useful life would be depreciated at a rate of $12,000 per year. This is known as straight-line depreciation.

There are other more complicated methods of fixed-asset depreciation that allow for accelerated depreciation on the front end, which is advantageous from a tax standpoint. You should seek the advice of your CPA before setting up depreciation schedules for fixed-asset purchases.

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Elements Of The Accounting System : Accounts Payable & Accounts Receivable

ACCOUNT PAYABLE

Whom do you owe? Keep track with the accounts payable ledger, The accounts payable subledger is similar to that used to track accounts receivable. The difference is that accounts payable occur when you purchase inventory or other assets on credit from a supplier.
It is important to track accounts payable in a timely manner to ensure that you know how much you owe each supplier and when payment is due.

Many a good supplier relationship has been damaged due to a sloppy accounts payable system. Also, if your suppliers offer discounts for payment within 10 days of invoice, a good automated accounts payable system will alert you when to pay to maximize the discounts earned.

ACCOUNT RECEIVABLE

Who owes you? Keep track with an accounts receivable ledger, If you plan to sell goods or services on account in your business, you will need a method of tracking who owes you how much and when it is due. This is where the accounts receivable subledger comes in. If you will be selling to a number of different customers, then an automated system is a must.

A good bookkeeping software system will allow you to set up subledgers for each customer. So when a sale is made on account, you can track it specifically to the customer. This is essential to ensure that billing and collection are done in a timely manner.

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Chart Of Accounts : Elements Of The Accounting System

The first step in setting up an accounting system for your business is deciding what you want to track. A chart of accounts is simply a list of your accounts and is kept by every business to record and follow specific entries. Whether you decide to use a manual system or a software program, you can customize the chart of accounts to your business.

Account numbers are used as an easy account identification system. For most businesses, a three-number system will suffice; however, a four-number system is sometimes used for more complex ventures. The chart of accounts is the fuel for your accounting system. After the chart of accounts, you establish a general ledger system, which is the engine that actually runs your accounting system on a daily basis.

The chart of accounts is the foundation on which you will build your accounting system. Take care to set up your chart of accounts right the first time. Keep your account descriptions as concise as possible. And leave plenty of room in your numbering system to add accounts in the future.

Excerpted from Start Your Own Business: The Only Start-Up Book You'll Ever Need, by Rieva Lesonsky and the Staff of Entrepreneur Magazine, © 1998 Entrepreneur Press

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General Ledger - Elements Of The Accounting System

Whom do you owe? Keep track with the accounts payable ledger. every account that is on your chart of accounts will be included in your general ledger, which should be set up in the same order as the chart of accounts. While the general ledger does not include every single accounting entry in a given period, it does reflect a summary of all transactions made.

If your business is small and cash-based, you can set up much of your general ledger out of your checkbook. The checkbook includes several pieces of information vital to the general ledger-cumulative cash balance, date of the entry, amount of the entry and purpose of the entry. However, if you plan to sell and buy on account as most businesses do, a checkbook alone will not suffice as a log for general ledger transactions. And even for a cash-based business, a checkbook cannot be your sole source for establishing a balance sheet.

An important component of any general ledger is source documents. Two examples of source documents are copies of invoices to customers and from suppliers. Source documents are critical in that they provide an audit trail in case you or someone else has to go back and study financial transactions made in your business. For instance, a customer might claim that he never received an invoice from you. Your source document will prove otherwise. And your source documents are a required component for your accountant at tax time. Other examples of source documents include canceled checks, utility bills, payroll tax records and loan statements.

All general ledger entries are double entries. And that makes sense, because for every financial transaction in your business, the money (or commitment to pay) goes from one place to another. For instance, when you write your payroll checks, the money flows out of your payroll account (cash) into the hands of your employees (an expense). When you sell goods on account, you record a sale (income) but must have a journal entry to make sure you collect that account later (an account receivable).

The system used in recording entries on a general ledger is called a system of debits and credits. In fact, if you can gain even a basic understanding of debits and credits, you will be well on your way to understanding your entire accounting system.

As outlined above, for every debit, there should be an equal and offsetting credit. It is when the debits and credits are not equal or do not offset that your books don't balance. A key advantage of any automated bookkeeping system is that it will police your debit-and-credit entries as they are made, making it far more difficult not to balance. It won't take many 3 a.m. error-finding sessions in a manual system to persuade you to automate your bookkeeping system!

All debits and credits either increase or decrease an account balance. These basic relationships are summarized as follows:

Account Type

Debit

Credit

Assets	Increases	Decreases
Liability	Decreases	Increases
Stockholder's Equity	Decreases	Increases
Income	Decreases	Increases
Expense	Increases	Decreases

In a general ledger, debits always go on the left and credits always go on the right.
While many double entries are made directly to the general ledger, it is necessary to maintain subledgers for a number of accounts in which there is regular activity. The information is then taken in a summary format from the subledgers and transferred to the general ledger. Subledgers showing cash receipts and cash disbursements are pretty easy to follow. However, some subledgers, such as accounts receivable, inventory, fixed assets, accounts payable and payroll can prove to be a challenge in their daily maintenance.

Excerpted from Start Your Own Business: The Only Start-Up Book You'll Ever Need, by Rieva Lesonsky and the Staff of Entrepreneur Magazine, © 1998 Entrepreneur Press

Ref : http://www.entrepreneur.com/article/21912#ixzz2ePefRdWP

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Which Accounting Method is Best For Your Business ?

Based on Basic Accounting Principles Most businesses typically use one of two basic accounting methods in their bookkeeping systems: cash basis and accrual basis. While most businesses use the accrual basis, the most appropriate method for your company depends on your sales volume, whether or not you sell on credit, and your business structure.

The cash method is the most simple in that the books are kept based on the actual flow of cash in and out of the business. Income is recorded when it is received, and expenses are reported when they are actually paid. The cash method is used by many sole proprietors and businesses with no inventory.
From a tax standpoint, it is sometimes advantageous for a new business to use the cash method of accounting. That way, recording income can be put off until the next tax year, while expenses are counted right away.

With the accrual method, income and expenses are recorded as they occur, regardless of whether or not cash has actually changed hands. An excellent example is a sale on credit. The sale is entered into the books when the invoice is generated rather than when the cash is collected. Likewise, an expense occurs when materials are ordered or when a workday has been logged in by an employee, not when the check is actually written. The downside of this method is that you pay income taxes on revenue before you've actually received it.

Should you use the cash or accrual method? The accrual method is required if your annual sales exceed $5 million and your venture is structured as a corporation. In addition, businesses with inventory must also use this method. It also is highly recommended for any business that sells on credit, as it more accurately matches income and expenses during a given time period.
The cash method may be appropriate for a small, cash-based business or a small service company. You should consult your accountant when deciding on an accounting method.

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What Is Accountancy, or Accounting ?

What Is Accountancy, or Accounting ?, What is the difference between "accounting" and "accountancy"? The following are explanation about Accountancy, or Accounting which we have quoted sources :

• Accountancy is work done by accountant: the work or profession of an accountant. Accounting is the activity, practice, or profession of maintaining the business records of a person or organization and preparing forms and reports for tax or other financial purposes
• Accountancy" more as a profession or even a company that does accounting (not just part of a company, i.e. a department).
  Accounting would be the actual activity or process.
• Accounting is the systematic recording, reporting, and analysis of financial transactions of a business. As bookkeeping involves making a financial record of business transactions, it is true to say that the role of bookkeeping is encompassed within the scope of accounting, and the bookkeeping system used by a business would form part of the accounting system.
  Accounting also includes the preparation of statements concerning assets, liabilities and the operating results of a business.
  Accountancy is the occupation related to accounting, and an accountant is the person who does, or at least is responsible for, the work. Accountants often specialize in a particular area of accounting such as taxes, auditing, or management.
• Accounting is a system of financial informations that were collected every day at a company. This processes provide information about a company's financial situation. This includes recording recording financail information and putting it into financial statements for the internal or external users. Internal users are people who manage the activities of the whole company such as general director, deputy general director, and managers. And external users are people who use this statement for their business purposes like investing or buying stockholders and so on.
  Accountancy is one of many kinds of careers in a society. It's the same with teaching, engineering, art, and so on
• Accounting is The art of recording, classifying, and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of financial character, and interpreting the results thereof.
  Accounting is called "the language of business" because it is the vehicle for reporting financial information about a business entity to many different groups of people. Accounting that concentrates on reporting to people inside the business entity is called management accounting and is used to provide information to employees, managers, owner-managers and auditors.
  Accountancy is the art of communicating financial information about a business entity to users such as shareholders and managers.
  Accountancy is a branch of mathematical science that is useful in discovering the causes of success and failure in business. The principles of accountancy are applied to business entities in three divisions of practical art, named accounting, bookkeeping, and auditing.

Accountancy, or accounting, is the production of financial records about an organization. Accountancy generally produces financial statements that show in money terms the economic resources under the control of management; selecting information that is relevant and representing it faithfully.
The principles of accountancy are applied to accounting, bookkeeping, and auditing.
Many tedious accounting practices have been simplified with the help of computer software. Enterprise resource planning (ERP) software provides a comprehensive, centralized, integrated source of information that companies can use to manage all major business processes, from purchasing to manufacturing to human resources. This software can replace up to 200 individual software programs that were previously used. Computer integrated manufacturing allows products to be made and completely untouched by human hands and can increase production by having less errors in manufacturing process. Computers have reduced the cost of accumulating, storing, and reporting managerial accounting information and have made it possible to produce a more detailed account of all data that is entered into any given system. Computers have changed business to business interaction through e-commerce. Rather than dealing with multiple companies to purchase products a business can purchase a product at a less expensive price and take out the third party and vastly reduces expenses companies once accrued. Inter-organizational information system enable suppliers and businesses to be connected at all times. When a company is low on a product the supplier will be notified and fulfill an order immediately which eliminates the need for someone to do inventory, fill out the proper documents, send them out and wait for their products.
Accounting is thousands of years old; the earliest accounting records, which date back more than 7,000 years, were found in Mesopotamia (Assyrians). The people of that time relied on primitive accounting methods to record the growth of crops and herds. Accounting evolved, improving over the years and advancing as business advanced.
Early accounts served mainly to assist the memory of the businessperson and the audience for the account was the proprietor or record keeper alone. Cruder forms of accounting were inadequate for the problems created by a business entity involving multiple investors, so double-entry bookkeeping first emerged in northern Italy in the 14th century, where trading ventures began to require more capital than a single individual was able to invest. The development of joint-stock companies created wider audiences for accounts, as investors without firsthand knowledge of their operations relied on accounts to provide the requisite information. This development resulted in a split of accounting systems for internal (i.e. management accounting) and external (i.e. financial accounting) purposes, and subsequently also in accounting and disclosure regulations and a growing need for independent attestation of external accounts by auditors.

Today, accounting is called "the language of business" because it is the vehicle for reporting financial information about a business entity to many different groups of people. Accounting that concentrates on reporting to people inside the business entity is called management accounting and is used to provide information to employees, managers, owner-managers and auditors. Management accounting is concerned primarily with providing a basis for making management or operating decisions. Accounting that provides information to people outside the business entity is called financial accounting and provides information to present and potential shareholders, creditors such as banks or vendors, financial analysts, economists, and government agencies.
Because these users have different needs, the presentation of financial accounts is very structured and subject to many more rules than management accounting. The body of rules that governs financial accounting in a given jurisdiction is called Generally Accepted Accounting Principles, or GAAP. Other rules include International Financial Reporting Standards, or IFRS, or US GAAP.

That's all topic about  Accountancy, or Accounting, may be useful !


Ref : http://en.wikipedia.org/wiki/Accounting | http://www.english-test.net/forum/ftopic8602.html | http://answers.yahoo.com/question/index?qid=20081210221609AAs1AbG

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