The fact that small businesses need good accounting is not a breaking news story. If you own a business or are thinking about starting one, you already know that you need to keep your numbers and books organized in order to succeed. Pay no attention to accounting, and you could even end up paying hefty fines or dealing with more serious legal troubles.
Do you feel like you’re in the dark when it comes to accounting? Learning these basic terms will help, but once you go through them, you’ll see why it pays to invest in professional services.
Limited Liability Company
If you operate a small- to medium-sized business, you need to familiarize yourself with the acronym LLC, which stands for limited liability company. Each state, including Florida, has its own rules around setting up and registering for an LLC, but choosing this entity can help entrepreneurs save a small fortune when it comes to their federal income taxes.
Actually, every business should put some thought into choosing the right business structure. There are others, but LLCs tend to offer the most benefits and the least amount of hassle. Not to mention that you can also use a formation service to set up an LLC online with fewer costs.
So this one is geared more towards entrepreneurs who are just getting their business started. Although it never hurts for seasoned business owners to revise their business plans, or write one if they haven’t in the past. The reason this term relates to accounting is that every business plan should have a solid financial section, the details of which we’ll cover below.
The first part of any financial business plan should be a well-researched sales forecast. As part of this important accounting and financial statement, you will need to spend time estimating your sales revenue, allocating financial resources, and planning for financial growth for your startup.
Another key accounting component of your plan and business is your cash-flow statement. Even experienced business owners can get a little confused by this one, which is why you should keep a comprehensive guide bookmarked to help guide you through each step. Alternatively, you can track revenue streams with powerful reporting software
Much like LLC laws, these can vary according to your state. No matter where your business is located, however, your payroll practices are likely to be governed by a strict set of rules and regulations, both at the state and federal level. Being unaware of or ignoring these regulations can land your business in some serious hot water and put your reputation at risk too.
Make no mistake, this is the single most important term you can learn about when it comes to getting accounting right for your business. As you can see from the list above, there are so many terms, details and regulations involved with business accounting. It’s still a good idea for small business owners and entrepreneurs to familiarize themselves with accounting elements, but it’s an even better idea to hire a pro.
A professional accountant will make sure no accounting or bookkeeping detail goes missed for your small business. Plus, you’ll have a knowledgeable expert to guide you through the toughest accounting tasks, like putting together financial reports, tax returns and payroll.
Accounting is crucial for the success of any business, so make sure you get this part right for yours. Your best bet is to hire an accountant to guide you through the steps of setting up a new business or getting an older business back on track. Then instead of wasting time guessing and stressing over bookkeeping and accounting, you can spend more time promoting your business.
Gloria Grace Rand can help you grow your business with messages from the heart. Let’s connect today! Call (877) 960-5415.