Print Friendly, PDF & Email
RSS

Online Bookkeeping Solutions Blog

The Online Bookkeeping Solutions Blog is an timely collection of interesting and helpful information for those companies who want to outsource their bookkeeping solution and utilize bookkeeping services by subscription. Outsource your bookkeeping to a cloud based solution backed by experienced CPA's.

How To Secure Your Flash Drive

USB flash drives are becoming more common everyday. With the increasing amount of data they can store, they are actually quite useful in transporting business files and other sensitive information.

However, since USB flash drives are so small and portable, they can easily be lost, stolen, or misplaced. If you store sensitive information on your flash drive, then you need to protect it by encrypting your flash drive. This makes the files on your flash drive password protected and only accessible by you or someone who knows your password.

The TrueCrypt technology provides step-by-step instructions on how to encrypt your flash drive. To view and follow these instructions, click here: http://www.truecrypt.org/

By encrypting your flash drive, you’ll have peace of mind knowing that if you ever lose it, your information will never be exposed.

However, from the standpoint of a business owner, encrypting a flash drive is pointless unless everyone within the company does it. We recommend having a documented quality assurance process for your employees to adhere to when taking a flash drive out of the office.

The basic steps a business owner should take to create a company-wide flash drive encryption policy are as follows:

  1. Encrypt a number of firm-owned flash drives for transport of business files
  2. Make employees sign out if they want to use these devices
  3. Implement an administrator of the company’s flash drives who will insure their timely return and confirm that all files on the encrypted flash drive have been removed so that the device can be reissued to another employee

 

Comments (0) | Trackbacks (0) | Permalink

Bookkeeping 101

Bookkeeping is one core business function you literally can’t afford to ignore. Good bookkeeping directly affects your accounting – the cost, the quality of the information, even your accounts receivable and operating cash flow.

What exactly is bookkeeping? Simply put, it’s the recording of a business’s financial transactions. It’s also an integral component of the accounting process. Good bookkeeping practices lend themselves to good accounting practices.

Bookkeeping includes the tasks of tracking receipts, canceled checks, and other records generated by financial transactions such as cash disbursements, sales, and purchases. Good bookkeeping records are organized chronologically in a journal. These journal entries are then posted to a general ledger, which accountants rely on to prepare monthly financial statements.

Sure it’s good to be organized in matters of financial transactions, but there are several bigger-picture reasons why good bookkeeping is critical to your business. Does your business rely on outside financing? If so, let’s say you are trying to win over potential lenders and investors. They will absolutely want to see accurate and complete books for a business before granting a loan or contributing capital.

Bookkeeping also helps you foresee and avoid cash-flow related issues. It provides you with a better grasp of the information you need to run your company. Having an up-to-date general ledger shows which customers have past-due accounts or outstanding balances, so you can act on these problems sooner and more effectively. Well-kept books also help you compare profits to expenses, and aid in the assessment of whether your business is on budget.

And let’s not forget about tax time. As stated earlier, good bookkeeping processes lend themselves to good accounting practices. So when it’s time to figure out how much you owe or are allowed in deductions from the government, good records of the year’s financial transactions, as well as the ability to easily pinpoint any receipt or cancelled check in the event of an audit, will save you from possible fines and penalties.

So while it may not be the most fun aspect of running a business, it’s worth it to take the time to make sure you have a solid bookkeeping system in place for your business. Are your books providing you with information that helps you make good decisions?

 

Comments (0) | Trackbacks (0) | Permalink

Small Business Health Care Credit Act – What You Need to Know

Not sure if you qualify for a credit under the Small Business Health Care Act? Now that tax season is under way, it’s definitely important to know if you qualify, and how to take advantage of this new tax legislation.

The purpose of the Small Business Health Care Act is to encourage small businesses and tax-exempt organizations to offer and maintain healthcare coverage to employees. It was specifically designed to help small businesses and tax-exempt organizations that primarily employ moderate- and lower-income workers.

How does this translate to your business? If, in 2010, you contributed an amount equal to or at least half of the cost of single coverage of health insurance for your employees, then you are eligible. From now until 2013, the maximum credit is 35 percent of premiums paid by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax-exempt organizations.

The terms of this act reflect it’s true target: the small business owner. The maximum credit goes to the smallest employers – those with 10 or less full-time employees earning annual wages of $25,000 or less. The credit is completely phased out for employers that have 25 full-time employees or more or that pay average wages of $50,000 per year or more.

 

Comments (0) | Trackbacks (0) | Permalink

How To Choose a Payroll Service

Doing your own payroll can cost you – both in time and penalties. The IRS penalizes about one of every three businesses for payroll errors. Often times, these penalties are more than the cost of hiring a payroll company. Not to mention, hiring a payroll company frees up hours that you can devote to other important parts of your business.

A good payroll service should do three things for you:

  1. pay your employees on time
  2. pay your payroll taxes on time
  3. file your payroll tax forms on time

Finding a Good Payroll Service

To find a good payroll service, it’s recommended that you get referrals from trusted, knowledgeable sources, such as CPAs or attorneys. You should also try getting references from other businesses within your industry. A good payroll service may let you talk with some of its clients so that you can get more information about the quality of service you’ll be getting.

Use caution, as some large services may try to bundle your payroll package with additional services that you might not need, like other outsourced business functions. This could drive up your costs unnecessarily. To avoid this, make a list of the services you anticipate needing in the upcoming year.

Ask yourself questions like how much you plan on growing, how many employees you’ll have on your payroll throughout the year, and how often you want to issue paychecks. Will you need a company that can handle different state taxes? Will you be offering employees 401(k)s and other deductions? You want to make sure your payroll service can offer the services you need, or else it’s not right for your business.

It can be critical that a payroll service be familiar with your line of work. For example, if you have union workers in your company, make sure you go with a service that is experienced in dealing with union rules. Or if you run a restaurant where your employees need tips, you need a payroll service that knows how to file taxes accordingly.

A Few More Things to Consider

While payroll services can be pared down to the basics, you may want to add some features offered by your payroll service company. For example, you may want direct deposit, online pay stubs, or online time tracking. You also want a guarantee that your payroll service provides an online platform that ensures the data you enter is the data that actually gets processed. Finally, make sure you know whether you’re being charged monthly or by the pay period.

Interview Your Prospective Payroll Service

Never hire the first payroll service company you interview; meet with at least your top two or three choices before making a final decision. Here are some basic questions that should help you get a feel for if the payroll service is right for your company.

  • If the service makes a mistake, who is held accountable, and how is it resolved?
  • Are there extra charges for adding or changing employee payroll?
  • How quick is turnaround?
  • Can the service integrate with your accounting software?
  • What technology does the service use?
  • How often will you receive reports?
  • How available is customer service?
  • Does it cost more to file taxes in multiple states?
  • Are there annual fees and if so, are they subject to change?

While you should make sure your payroll service meets your needs, be leery of buying more than you need. Do not be fooled by an over-zealous salesperson trying to lock you into a bundle package. Get a price quote that is strictly for the services you’ve mapped out.

 

Comments (0) | Trackbacks (0) | Permalink