Archive | July, 2012

Cash Flow – The Key to Make A Business Successful!!

17 Jul

A young business is characterized as being a “venture” and entrepreneurial” in nature. To take a viable venture and make it a growing concern, the entrepreneur must employ effective management strategies. If you run out of cash, you basically are out of business. Therefore it’s a smart idea to pay attention to it. In financial accounting, there is a concept called cash flow statement or statement of cash flows. It means a financial statement that shows a company’s incoming and outgoing cash during a time period.

For decade, both investors and lenders have used a company’s cash flow statement as a determinant of it’s financial health. This is part of Generally Accepted Accounting Practices. A cash flow plan consists of three parts. The first two parts everyone knows: income and expenses. It is the third part which holds out hope of improvement. The third part is the difference between income and expenses. It goes under several names, from discretionary funds to savings to free money. Cash flow statements format planning involves forecasting and tabulating all significant cash inflows and analyzing the timing of expected payments in detail.

Some advantages of the cash flow statement:

  • Helps the startups to know their inflow and outflow of cash and helps to prevent cash shortage
  • Helps the investors to judge whether any company is financially sound or not.
  • Helps the company to know whether it will be able to cover payroll and other expenses
  • Highly helpful for planning and management of future financial commitments
  • Sustainable profits come from good Cash Flow Analysis and Cash Flow Management.

Using financial or accounting tools such as software can help to manage Cash Flow well. Good accounting software will also let you budget income & expenses and will in exchange budget your cash flow. This makes it easier to make wise spending decisions, and not to overspend. Using your financial and budgeting software to help you run ‘what-if’ scenarios can be helpful for your bottom line, and can therefore help improve your cash.

 

Why We Need a Tax Consultant

5 Jul

If you are an independent contractor, consultant or an expatriate working offshore it may be advisable to get a reputable tax consulting company to look after all your taxation and social security needs. As a wag once famously said, “The only things certain in life are death and taxes.” Though this remark was aimed at individual men and women, it applies equally well to all business enterprises, big or small. Paying your tax in time is important for both your company and the country.

If you are not comfortable with doing your tax calculation on your own, you can outsource it to Public Accountants or Tax Consultants for better accuracy and thereby avoid over or over taxation. Taxation regulations can differ greatly form country to country, as with the legal regulations relating to managing income. To make your life easier and legitimate, choose a reputable consulting firm who can ensure you to get top tax consulting services.

To find a suitable taxations consultant specialist, research the internet and visit tax consultant’s websites to review the services and products offered. After making a short list of potential firms, get more specific particulars from each of these entities. Follow up on this with personal interviews with the firms and verifying their references. You can also check up on their previous history and performance by referring to professional bodies like NATC and the Better Business Bureau.

The cost of hiring a consultant varies depending on the type of consultant you choose to hire. A Certified Public Accountant who is not on your regular payroll will charge you an hourly fee. A tax consultancy firm on the other hand will charge a flat rate depending on the amount of work. If you are planning to work across borders choose a top taxation consultant to handle all the day to day management. Rid yourself of legal headaches and burdens; use a professional tax consultant company to organize your financial affairs.