In Pursuit of Profit
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We’ll break down what a COA is and why you need one, give you some pointers on how to create a COA, provide an example of a chart of accounts for you, and give you some helpful reminders to be aware of as you create your own COA. Let’s get started talking about accounting chart of accounts fundamentals:
Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it.
There is no doubt that our work is more satisfying and fulfilling when we are experiencing joy in what we are doing. Here are a few reminders about finding the joy in your work:
Cash-strapped startups need to be judicious with how they spend their money on everything from operating expenses to hiring costs. When there is just not enough room in the budget to pay an accountant market value for their experience, a startup may need to get creative with their overall compensation package, rethink their “ideal candidate” profile, and potentially even consider outsourcing as an option (at least temporarily).
Finding an accountant for a startup company can be extremely challenging because new companies typically do not have the same cash reserves that more established companies do. This pain point is shared by small businesses everywhere but can be exacerbated by the perceptions around startups.
As the owner of a startup company, hiring an accountant can be a difficult task to undertake. Use these tips to find an experienced accountant to help get your startup off the ground:
There is no doubt the US workforce landscape continues to experience significant changes. The business challenges of the last few years have caused many companies to rethink how they can best execute their operating plans. With more and more companies outsourcing their accounting functions, there are a few important things to keep in mind to ensure a beneficial outcome.
Written in conjunction with our partners at CFO Selections
A cash flow shortage is the number one reason why small businesses fail, but even mid-sized and large companies need smart cash flow management to survive and thrive.
Insufficient cash forces companies to make difficult decisions about who is going to get paid and when. Unfortunately, this can lead to vendors and suppliers being paid late, being overdue on rent, even employees waiting on paychecks.
It is not an exaggeration to say that cash is the lifeblood of any business. Not having enough money to pay for expenses can erode business credibility, which leads to:
Ultimately, a company’s potential will be stifled if there is not enough capital to invest in the assets that facilitate growth, and its very existence can be threatened as well.
So, are you ready to manage cash flow for the coming year?
As an accounting recruiting firm and financial services provider, we work with businesses everyday who ask, “Should we hire or outsource our accounting needs?”
This question is especially important for companies in the startup phase because they likely have significant cash flow concerns to consider. However, startups may also have other unique characteristics that make this question more challenging to answer, such as:
While every business will have their own unique needs and challenges, it is generally best for a startup to outsource their accounting activities initially and then hire internally as their needs change. Where does that shift happen?
We see a variety of circumstances in our practice at ASP, whether it be outsourced consulting needs, or an organization growing and needing to consider a fulltime resource. Our recruiting efforts are responding to those fulltime needs daily. The pandemic has shifted the business landscape significantly, making strong financial leadership universally important.
Small companies that previously had their CEO at the helm of financial operations have realized that they need a fulltime controller to oversee their accounting operations and staff. With the increased demands of operating during financially uncertain times, CEOs need to focus on their core role of running the company overall (pivoting and shifting as needed), while entrusting another professional with the financial management of the company.
As a result, hiring a fulltime controller is no longer optional these days with the following business trends occurring:
What is Contingent Recruitment?
According to recent data, 76% of companies report that attracting well-qualified candidates is their biggest hiring challenge, making recruitment a serious concern for most businesses.
Hiring a recruiting firm is the best way to find top-notch candidates for your open positions. While some recruiting agencies use a retainer model, others use a contingency agreement. How do you decide which approach is best for your needs?
With contingent recruitment, the recruiting agency only gets paid when they find and place a qualified candidate into the role they are hiring for on behalf of their client. Contingency recruiting fees are typically structured as a percentage of the candidate’s first-year base salary and can vary widely from one recruiting company to another based on geography, industry, and position level.
Why Use Contingency Recruiting?
Unlike retained search, where recruiting fees are typically paid in installments at the beginning and throughout the process, contingent recruiting is based on the idea of only paying once results have been achieved. Many companies prefer to work with a recruiting agency that uses a contingency model because it is often much less expensive, and the fees are easier to understand. It is reassuring to hiring companies, especially smaller businesses, to know that they will not be paying a recruiting fee until after a qualified candidate has been hired.
The possibility of business fraud is the dirty little secret that business owners tend to ignore. Unfortunately, there will always be unscrupulous individuals that try to take what is not theirs, even during hard times. Recent reports of bookkeeper fraud serve as a reminder to business owners that fraud never stops, even when businesses are down on their luck. In fact, a global fraud study found that, on average, companies lose 5% of their yearly revenue to fraudulent activities.
While it is easy to imagine fraud occurring by faceless cybercriminals or strangers sneaking in to rob your company of cash and valuable assets, most perpetrators have deep ties to the business, and many are first-time offenders. Many times, the people you least expect are the ones responsible for fraudulent activity – long-time employees, close friends, and even family. These bonds can make it difficult to spot the warning signs, causing fraud to go undetected far longer than it should.