Accounting is more than just keeping track of purchases and balancing a checkbook. For example, remitting tax, owning an account in the bank, handling finances- either personal or business, all require accounting knowledge. Some of those who specialize in accounting are of course more skilled and have risen to the top of the industry due to their ability to understand complicated tax law and work with their clients closely.  These firms have each made names for themselves and are generally considered to be trust worthy, and careful in their work.  Taxation is an extensive process that involves large sums of money, calculation and filing forms (at its most basic level). Without proper tax procedures, a company may be shut down or fined heavily. Consequently the reputation of that company is destroyed. This is why these accounting companies have become what they are now; because of the sensitive nature of taxation and law, only those who can help their clients avoid serious crimes can succeed.

Large accounting firms in the world utilize the services of lawyers. LL. M taxation is a section of law that gives one a chance to specialize in a particular area such as the organization of business, international tax, estate planning or wealth management among others. At times, people may take those generalities to get a wide spectrum of the tax law. In all cases, the lawyers are very helpful to their clients and each of the following firms would be able to advise you in correct and incorrect forms of Tax Law.

Deloitte is one of the largest accounting firms in the world. Its growth is steady. It provides professional services in many countries across the world. These services are auditing, tax, financial advisory, consulting and enterprise risk.  These services are required by various companies across the world. This company is constantly acquiring new clients each year. From research, it has been shown that, Deloitte beat PwC to become number one in 2010. This means that the company offers the best services across the countries where they are established. Employees of this firm are highly qualified to offer high quality services.

A lawyer working for such a reputable firm is highly qualified. In the sector of taxation, most of them have LL. M taxation. This enables them to work efficiently. For these lawyers to obtain an advanced degree is not hard. This is because, this degree is offered online. Others can choose to do it part time, that is evenings after work. Here, the individuals are aiming for a better pay as well as increasing knowledge in the field of study.

PriceWaterhouseCoopers, commonly known as PwC is another top accounting firm in the world. Basically, it is a multinational company with headquarters in London. It currently is the largest in the world offering accountancy services. PwC is widespread in the world. It is found in one hundred and fifty nine countries. In this firm, the managing consulting services were the fastest growing and the most profitable area. In United States, it was ranked as the fifth largest private owned company.

Ernst & Young is another global organization found in one hundred and forty countries. Its headquarters is in London. In the United States, it is ranked the eighth largest private company by Forbes magazine. This is the most globally managed company in the world, because it sets global standards and oversees the policy and service consistencies. Ernst & Young has divided its professional services into four areas for ease of management. These are; Americas, Asia-Pacific, Japan and Europe, Middle East, India and Africa, commonly referred to as EMEIA. This firm has grown over the years to join the big four. Additionally, this company has been ranked as one of best places for women to work by Working Mother’s magazine. It has various services including tax services offered by qualified lawyers.

KPMG is a professional firm providing a range of services in auditing, tax and advisory services in more than one hundred and fifty six countries worldwide. This is a global firm with the aim of helping individuals out of their accounting problems. They help people grow in their areas of specialization.

Overall, each of their firms has made significant gains in the previous years to earn they names they have now.  Keeping an eye on these firms and their dealings may just be the ticket to helping you to find a firm to take charge of your accounting and tax needs.

 For more information on tax laws and education click HERE!

Check fraud can affect everyone, no matter how careful and diligent. Both companies and individuals can become the victims of such schemes. There are several precautionary measures that can be undertaken to minimize the check fraud risk.

Do you know what check fraud is and how to keep yourself protected? Here is all the information that you need to know.

What is Check Fraud?
Both businesses and financial institutions have become the victims of check fraud. New technologies and software programs make it a lot easier for criminals to forge checks. Many innocent victims lose significant amounts of money due to clever schemes that goes on for months, even years.

There are several types of check fraud schemes. Forgery is the instance in which someone issues a check without having the authority to do so. Stolen checks are also used in forgery schemes.

Counterfeit checks are either entirely fabricated or duplicated through the use of computer software and high quality printers. In the case of alteration, some solvents or chemicals will be used to remove or modify the information that is written on the check.

Finally, there is paperhanging. In this instance, checks are written on closed accounts. Paperhanging can also involve reordering a check on a closed account.

The Signs of a Bad Check:
To stop check fraud, you will first have to recognize the signs of manipulation. Recognizing bad checks is possible in several simple ways. Always be careful with checks that lack perforations, checks that lack a number and a check that have low numbers.

Take a look at the handwriting or font. If you spot two distinct types of writing, it is highly possible for the check to be bad. The same is true if the customer address or the bank addresses are missing. Stains or ink discoloration could mean that the check was alternated.

You should examine the checks for additional signs of fraud. The word VOID appearing across the check is one such sign. Checks that lack authorized signatures should be viewed with suspicion, as well.

Controlling Access:
To stop check fraud, you should be exceptionally careful with the way in which you handle your checks. Limiting access and being very responsible will make it much more difficult for criminals to gain access to your private or financial information.

Store your check stock in a secure location. When it comes to companies, you should provide access to only a few trusted individuals. Reconcile the corporate checking accounts on a regular basis, even daily, if possible.

Limiting access to digital check signatures is just as important. In the best case scenario, you should be the only person who has access. You should also consider the use of separate accounts for electronic payments and for checking needs. This way, you will increase accountability.

Finally, you should introduce some form of control to the company’s payment processing areas. Mail the checks instead of handing them to employees to deliver them to someone.

Work with Professionals
Check fraud schemes could be exceptionally intricate and well-coordinated. Dealing with this type of organized fraud can be a major challenge. In such instances, you should seek the assistance of professionals.

Forensic accountants can help you carry out an investigation, whether you have incurred financial losses or you suspect that you have come across a bad check. They will examine all the financial evidence discreetly to figure out whether fraud is actually taking place and whether you have suffered from it systematically.

Check fraud could be amateurish or it could be organized and highly professional. Contact the right authorities, even if you have the slightest suspicion that something is going on. Otherwise, you have to be careful and highly protective of your personal information. The more thought you put into precaution measures, the less likely you will be to become the victim of check fraud.

Author Bio: This is a guest post written by Nick Anderson. He is an experience finance writer and writes on different financial topics to share his knowledge and experience. Follow him on twitter @NickNikanderson.

There are a few SCAMs/SPAMs emails going around right now and I thought I should make you aware of them.  One wrong click and you are going to put your anti-virus software to the test, not something you may want to do!

Common sense should prevail, however, sometimes you just don’t know or can’t tell, so you must have great care in opening up attachments that you are unsure of.  The easy ones are like the ones I identified above, if you have not filed your taxes and get an email about your return being rejected – simply delete the email and move on.  Easy; no worries.  Turbo Tax from Intuit has recently announced that a SPAM email is being circulated about state income tax returns being rejected that had been submitted via the Turbo Tax online program.  For me it was easy to know if it was SPAM or not, since I had not filed my return yet.  However, what if I had used Turbo Tax (which I have in the past for several clients and children of mine) and receive this email?  Now things get complicated.

The most recent email that I have received is from ADP – a company similar to Paychex that processes payroll, along with other employee benefit programs to millions of customers.  Again, not an issue for me since I do all of my own payroll for my clients but what if I had used ADP – I may have opened it up!  Verizon is another company that I received what seemed to be an authentic looking email but was (to me) an obvious SCAM.

I truly don’t understand these people in the world who try and spread viruses, makes me sick.  How do they benefit?  Why can’t they put their skills to a better use?  Same thought I always had about the morons who paint graffiti too; put your God-given talent to some good use!

As in the words of one of my old favorite TV shows from the 80′s (Hill Street Blues) – “Be Careful Out There”!

Thanks! 

A woman from Louisville KY once told me – “You Gotta Have Goals”, shortly thereafter I was laid-off from that job.  I was one of her goals that week,  get rid of that Finance Director and move his department down to Kentucky.

Why do I bring this up you ask?  Because  while her actual goal was pretty lame in my book, the idea is priceless!  Without goals one just spins their wheels and the only productivity that does occur is haphazard or coincidental.  You really do have to have goals!

Just this morning my wife said to me, regarding a particular subject that we have been talking to each other quite a bit lately yet have not acted upon it yet – to write down three goals on the subject.  I did jot down the three goals which while I have not acted upon them I did have an overwhelming feeling of accomplishment!

This feeling of accomplishment lead me to jot down a list of five goals of things I wanted to accomplish at the day job.  Those goals were done by 2:30 pm! – Items that have been sitting either in my head or on my desk the entire week.  I wrote them down and started to proceed to knock them off one by one.  How cool is that?  The accomplishment high I was on lead me to create yet one more set of short-term goals for my home-based bookkeeping business which I will start to work on this evening and over the weekend.

Sometimes smart people need to be reminded of simple things.  Today’s hectic life seems to have so many items that will influence (not in a good way) your daily productivity.  There is way too many distractions with e-mail, social media and staying connected that time slips into a black hole.  I’m not saying don’t look at e-mail or have a social media life (to the contrary I feel just the opposite) but be realistic with time.  Get done what needs to get done and then reward yourself with a little SM, or follow up on those e-mails that will lead you to today’s blog post of someone that you subscribe to.

Set goals, set priorities and get the work done – simple things to do that make life a whole lot more fulfilling.  I needed to be reminded of this, and maybe this post will remind you as well!

I was even productive to select these special ads/offers just for you!

Thanks! 

Want to start your own business?have less money with you?lets see some tips how to start your own business with little amount….

The idea of starting a new business is similar to searching for a job having control on your working hours but not doing any thing is waste. If you are really interested then you will really make things happen.

Be attentive of going into business with friends:Though it reflects like a tremendous idea, making business is often a best prescription for blow. Partner ship with buddy’s avoid you from being active.

Make your Own Search:If you does not have any idea regarding new business which your going to start does not make any sense so search and know things in your own way which helps your business. You will not succeed if you jump into unknown industry. Learn something or know something about business, have a glance on the industry. If you start any any business then it should meet the needs of customers.

Create your own plan:for a basic plan just create a simple plan which is of one page that covers all the necessities reaching your targets and your prices. Its is a liquid process which will be flowing continuously, so make as simple as possible. By starting a small business you will have control on growth and you will focus on what is significant and also manages the things.

Catch your Target customer:Find out who are your customers with more specificity. For suppose if your making a skin-cream don’t tell it is for all or every one or adults could buy. It is only for the women who visit’s dermatologist for monthly face-packs or to who collect from stores. Your process, pricing and packing will determine who is the customer. Be specific and have clarity of your business, so that you may refer accurately using internet. Don’t wait, proceed with the process and even do marketing for your products.

Perfect your pricing:It should not cover with the cost, it should also create gain for your business. Don’t under estimate talent and time which is a big mistake one choice is to work with the numbers from top like what your looking to make it annual? how does it break weekly and monthly?what are the costs associated with that service or product? Plan with numbers so that it makes your work easy.

Go Out and Get Customers:This is where the miracles are going to happen nothing matters if we don’t have people. You should focus on effort, time and sales .Having smart plan will attract the people and change them to customers is your first priority. Don’t get frustrated start from where actually you are.

Start-up money:Until and unless you bring your sales you should present only low cost. Think differently so that many customers will come to you.

Unfortunately if you face any loss in business you can apply for ppi claims, which can provide some coverage for loss occurred in business.

Author Bio : This article has been written by Sarah, a professional blogger from UK. Sarah is interested in finance and politics and she has been writing articles on several such categories. Her hobbies include painting and reading, during free time. Her interests are researching on financial products and services and writing reviews on them. She is working on ppi claims and she is looking forward to posting a few articles on it.


Thanks

One of the more difficult aspects of my career has been collecting on Accounts Receivable.  Certainly our current economy does not help matters, and being in a recession since 2008 puts a bind on all businesses.  We have all seen in recent years a number of once thriving businesses fail.  One of the reasons many failing businesses site as the cause for their failure is bad debt.  Not getting paid by their own customers.  How can this be avoided?  How can we assure ourselves that we will get paid for our goods or services?

Some businesses frankly have it easier than others; they are a cash-up-front business.  How many Wal-Mart’s go under because of bad debt?  Unfortunately, not all of our businesses have massive check-out lanes in them.  Service related businesses and to a slightly lesser extent retail and wholesale goods companies selling with terms are at a direct disadvantage.  It’s a vicious circle though, as we simply can’t collect up-front like a Wal-Mart and risk losing the already illusive customer as it is.  However, being too generous with terms or worse yet, not following up diligently with A/R can be disastrous to a company.

What can an owner do to help with the reduction or elimination of bad debt?  Depending on your specific business, there are a number of ways to help yourself out.  Some are obvious, and some are not so obvious.  Some are easy and yes, some are very hard to do.

The following is a list of practical ways to avoid problems and collecting on A/R.  Not all of the below will fit to every type of company, but most will be appropriate in one form or another to your business.

1. Ask Questions!  Do you have a customer credit application, agreement, or a simple letter of expectations that is regularly used for ALL new customers?  Here is your chance to ask those uneasy questions that no one wants to ask.  “How long have you been in business?” (Most companies fail within the first few years) “Have you ever filed for bankruptcy?” (Is this a business practice of theirs)  “Will you personally guarantee your companies purchases from me?” (See my note below)  “Could I have a list of your three or more of your current suppliers?”  (Vital, if not mandatory question).  All of these are imperative questions that must be asked of new or potential customers.  A credit agreement/application is the best place for these questions as you do not have to verbally ask these questions face-to-face.  More important however, is diligently following up on the information provided; check those references!  Ask the references how many times the customer has made a late payment, have they ever been 90 or more days past due?  Unlike the typical mutual fund mandatory disclosure statement “Past performance does not guarantee future results” – past performance of a company’s payment history DOES provide fundamental information on their future payments to you.  A note regarding personal guarantees: I myself would never personally sign any such agreement unless it was for my own company or for personal purchases.  So I don’t take it as deal breakers if folks don’t sign mine either.  The customer agreement is also a great place to insert language regarding collection fees and monthly charges of accounts past due.

2. Be Up Front Regarding Expectations!  Certainly, your invoice for your goods or services will display Net30 or whatever your terms may be, however, when speaking with a new or potential customer, identify your terms and this will verbally lay out your expectations.  Everyone is friendly at the beginning of a new buyer-seller relationship; take advantage of that by verbally going over a few of the details found in the above described customer application/agreement.  You don’t have to speak about every item, just hit the main points and identify clearly what your payment terms are.

3. Follow Up Sooner Rather Than Later!  Your terms are net 30, should you wait until you are 60 days out? 45 days?  You are setting a precedent of how you handle A/R with your customers.  If you don’t call them shortly after your terms have expired, they know now they can stretch them.  Perhaps you don’t want to make that uncomfortable call?  You certainly want to keep all your customers happy so that they will continue to purchase from you.  While these calls are understandably difficult you have to ask yourself one question:  Do you like being a bank?  The entire time that you don’t have your customer’s payment it is costing you money.  You are being a bank to your customer, and the worse part is you are not charging them for it.  Do you pay your bills when they need to be paid?  What happens when you miss a payment to the bank, or are late?  It will cost you plenty.  On the contrary there is very little cost to making a timely A/R call.  If you are good, you can even make the call into another sale!  Feel free to shoot me an email and I will explain this actual scenario in greater detail.

4. Financials Tell All! This can be a little tricky for small businesses, but if you are able to get hold of a customer’s financial statements, they may tell you more than you think.  If a customer has a great deal of revenue come in, and you extend credit to them purely on that; this could be trouble.  Revenue should NOT be used alone or weighted heavily on credit approval.  What is a better indication of a good payment history will be total net worth.  The larger a firm’s net worth and time it has been in business is preferred over its revenue when coming to credit approval or the length of your payment terms.

5. Take Notes There are software packages that will aid you in taking notes and keeping history when talking to customers.  A simple spreadsheet can do the same trick.  A package such as Sage ACT is great and very detailed; however I find that you can become bogged down with too much of the detail they require.  A simple spreadsheet with customer name, contact name, phone number and brief customer-related info at the top will be sufficient.  I then date my calls in the first column, and write in my notes in the second column.  I freeze the panes with the contact info so that it is always visible.  As notes continue on down the spreadsheet you just simply hit enter for a new line.    Each tab in the spreadsheet is used for another customer.  I format the spreadsheet so that it is printable.  I also use a scoring key of 1 to 5 to rate how the contact is as far as attitude goes.  1 is a great customer, always friendly to talk to regardless of the current issue at hand or why he/she is not paying.  5 obviously is a score that alerts you to the fact that in the past your collection calls did not go over so well.  All customers start out with a “3” and after the next call I may or may not change the rating.  I use “3-4” when a customer was decent prior but the most recent call turned out not so good.  I keep this customer score near the top along with any other specific notes such as “Customer loves to talk about the Packers”, etc.  This customer scoring is like a trend analysis and you can see if things are going down hill or not.  Keep as detailed notes a possible.  If the customer says I am not paying until that desk drawer is fixed, then right it down so that when you go to call him next week you can find out prior to making the call if that desk drawer has been repaired or not.  There is nothing worse than making a collection call and make things worse when they are waiting for your company to do something.

6. Get a Date When a customer says I will get you a check, ask for an exact date.  Hold your customer accountable.  Customers are more apt to get you a check if they have given you a specific date versus some oblivious statement such as “Yeah I will send that out to you”.  I also tell the customer that I would be happy to “swing by” and pick up the check.  Again, this will assure you get paid faster, and also turn the collection call into a sales call!

Slow-Paying or No-Paying customers are a fact of life in business, but by following the guidelines that I have illustrated above will hopefully reduce the number of these instances for you!

by Associated Press
Published: October 23rd, 2012

By Stephen Ohlemacher
Associated Press

WASHINGTON — President Barack Obama isn’t talking about it and neither is Mitt Romney. But come January, 163 million workers can expect to feel the pinch of a big tax increase regardless of who wins the election.

A temporary reduction in Social Security payroll taxes is due to expire at the end of the year and hardly anyone in Washington is pushing to extend it. Neither Obama nor Romney has proposed an extension, and it probably wouldn’t get through Congress anyway, with lawmakers in both parties down on the idea.

Even Republicans who have sworn off tax increases have little appetite to prevent one that will cost a typical worker about $1,000 a year, and two-earner family with six-figure incomes as much as $4,500.

Why are so many politicians sour on continuing the payroll tax break?

Republicans question whether reducing the tax two years ago has done much to stimulate the sluggish economy. Politicians from both parties say they are concerned that it threatens the independent revenue stream that pays for Social Security.

They are backed by powerful advocates for seniors, including AARP, who adamantly oppose any extension.

“The payroll tax holiday was intended to be temporary and there is strong bipartisan support to let that tax provision expire,” said Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee. “The continued extension of a temporary payroll tax holiday has serious long-term implications for Social Security and, frankly, it’s not even clear that it has helped to boost our ailing economy.”

The question of renewing the payroll tax cut has been overshadowed by the expiration of a much bigger package of tax cuts first enacted under President George W. Bush. The Bush-era tax cuts also expire at the end of the year, and Congress is expected to try to address them after the election, in a lame-duck session.

The payroll tax cut could become part of the mix in negotiations that could go in many directions. But lawmakers in both political parties say they doubt it.

“I think there’s a growing consensus that Congress and the president can’t continue to divert such a critical revenue stream from Social Security,” said Rep. Kevin Brady of Texas, a senior Republican on the tax-writing House Ways and Means Committee. “I think more and more Americans understand that that payroll tax cut, while politically appealing, is endangering Social Security.”

Before he was named as Romney’s running mate, Rep. Paul Ryan, R-Wis., disparaged the payroll tax cut, calling it “sugar-high economics” that wouldn’t promote long-term growth.

Social Security is paid for by a 12.4 percent tax on wages up to $110,100, rising to $113,700 in 2013. Half is paid by employers and the other half is paid by workers. For 2011 and 2012, Congress and Obama cut the share paid by workers from 6.2 percent to 4.2 percent.

A worker making $50,000 saved $1,000 a year, or a little more than $19 a week. A worker making $100,000 saved $2,000 a year.

The beauty of the tax cut is that it shows up in weekly paychecks, giving workers more money to spend or save. The downside is that some workers might not notice a $19-a-week increase in pay, making them unlikely to credit the politicians who made it happen.

Under the law, Congress is reimbursing Social Security for the lost revenue, estimated at $103 billion in 2011 and $112 billion in 2012. But Congress didn’t cut spending or raise other taxes to offset the lost revenue, so the payroll tax cut is being financed with borrowed money, adding to the national debt.

Democrats are more willing to defend the tax cut, saying it helped prop up the economy during a rough stretch while providing what amounted to a 2 percent pay increase to millions of middle-income workers. But they, too, are concerned about maintaining Social Security’s source of revenue.

“I think people realize that was a temporary thing,” said Sen. Mark Begich, D-Alaska.

Rep. Richard Neal of Massachusetts, a senior Democrat on the Ways and Means Committee, said he thinks there is evidence that the tax cut helped the economy. But, he added, “I’m not sure that it met expectations.”

House Democratic leader Nancy Pelosi of California said she, too, wants to let the tax cut expire.

Larry Summers, Obama’s former economic adviser, is a lonely voice in Washington calling to extend the payroll tax cut. He said in a recent speech that the economy is too fragile to reduce workers’ incomes.

Obama pushed for the tax cut in late 2010 as a way to increase workers’ take-home pay to help boost consumer spending and provide a spark for the economy. Economists were divided on the economic benefits. Many said it probably helped increase consumer spending but there was no consensus on the magnitude.

The initial tax cut only was for a year, and many Republicans in Congress wanted to let it lapse at the end of 2011. But Obama and Democratic lawmakers successfully fought to extend it through 2012.

Obama, however, didn’t include the tax cut in his 2013 budget proposal, and Treasury Secretary Timothy Geithner told Congress this year that he saw no reason to extend it again.

White House spokeswoman Amy Brundage wouldn’t rule out an extension but wouldn’t commit to one, either.

“The president fought extremely hard last year in the face of Republican opposition to ensure that the payroll tax cut was extended,” Brundage said. “There are a number of tax issues that Congress will have to deal with at the end of the year, this being one of them, and we will continue to evaluate all of the options available to us at that time.”

Romney’s campaign hammers Obama almost every day for proposing to let Bush-era tax cuts expire for individuals making more than $200,000 and married couples making more than $250,000. But Romney’s tax plan would let the payroll tax cut expire, an issue he doesn’t mention on the stump.
Romney’s campaign declined to discuss the issue.

The health and vitality of your business depends on how well you monitor and record your finances. Between tax obligations, cash flow management, payroll and other overhead, there are so many things to consider when it comes to managing your business’ financial data – both for your own analysis and to keep the IRS happy – that the thought of going it alone may be just too daunting – but you’re not alone.

Most business owners end up making the decision to pass these tasks on to a professional accountant or bookkeeper – particularly if they feel they are spending too much time on books and not enough time on sustaining and growing the business. Sound familiar?

So, now the question you’re asking yourself is: Should I hire an accountant or bookkeeper as an employee or look to outsourcing this task?

Although the answer to this question will depend largely on your accounting needs and your budget, there are a few factors to consider when making the decision whether to hire or outsource:

1.      Consider Your Overall Accounting Needs

Up until this point, you’ve likely been handling your accounting and bookkeeping needs single handedly, so you may want to begin by asking yourself how many hours you are devoting each week to these tasks. If your accounting needs require just a few hours out of your week, hiring someone as an employee may not be very cost effective. Keep in mind that a professional accountant will likely accomplish these tasks in a much shorter period of time, so can you really justify an accountant on your payroll whose work amounts to little more than a few hours each week?

Having a bookkeeper on payroll full-time can be incredibly hard on your budget, while outsourcing your accounting needs means only paying when you use the service.

2.      Consider the Cost of Hiring an Accounting Professional

One of the biggest reasons companies look to outsourcing for their accounting and bookkeeping needs is because hiring a CPA is often much more expensive.

Consider this: Hiring an accounting professional may mean the purchase of computer equipment and software, as well as additional administrative costs. If you hire an accountant, will you also need additional office space, office furniture, or personnel? Will your current administrative team be required to assist your accountant, thereby decreasing their productivity? Hiring a CPA will likely cost you more than just a salary. Include everything from health insurance premiums to retirement benefits and overhead costs when considering the cost-effectiveness of hiring an accountant.

Outsourcing these services means never needing to worry about overhead and the many other expenses that accompany a new employee.

3.      Consider the Services You May Need

Many companies choose to outsource because it gives them access to a number of professionals, all of whom likely have different specialties or skillsets. Accounting firms may be able to provide you with a number of professional management and finance services, all for a fraction of what you would pay a salaried accountant, tax advisor, or financial planner.

Through outsourcing, you may have access to professionals who can help you do everything from manage your monthly budget to improve your financial performance.

4.      Consider the Value of your Time

Employing an accountant or bookkeeper requires your time and attention. Whether you’re pouring over resumes and engaging in interviews with potential accountants, or discussing the purchase of new accounting software, you’re committing your valuable time and resources to the process. With the time and expense you’d invest in hiring a new employee, you could go back to school and learn how to become an accountant yourself!

Outsourcing accounting services may eliminate yet another item on your to-do list, and allow you to focus on other – arguably more important – areas of your business.

5.      Consider How an Interruption in Accounting Services Could Disrupt your Company’s Operations

Any disruption in accounting services could really do a number on your company’s overall operations, so it pays to consider the likelihood that you may find yourself hiring and firing several accountants over time. Simply hiring a new accountant and working through his or her learning curve may throw your company into a tailspin in terms of reporting sales, completing payroll, and satisfying tax obligations on time.

Outsourcing your accounting and bookkeeping needs, however, likely means few interruptions. Because most accounting firms have a number of professionals on staff, if one person isn’t able to handle your financial needs, another person can step in and get the job done.

In the end, outsourcing is likely to provide a wide variety of benefits for the small business owner, including decreased overhead, a break in payroll, and access to experts capable of a wide array of financial and bookkeeping services

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Would you like further information?  Contact the folks at AccountingEdu.org

Description: Article describes the various ways in which the use of third party accounting services helps to decrease the possibility of a business being a victim of fraud.

A joke that is very apt in this context goes: A businessman is interviewing several candidates for a position and asks all of them the answer to two plus two. A candidate, who also provides accounting services, is asked the same question. In reaction, he gets up, closes the door of the office and slyly asks his potential employer, “How much do you want it to be?”

This story has done rounds around conferences, dinner tables and cafeterias. However, most of those unfamiliar with this profession are likely to just laugh and shrug their shoulders in ignorance. Only those who understand the depth of this line of work will pay heed to the message instilled that the quality of accounting services can influence the probability of your business being a victim of financial fraud.

Larger corporations and public limited companies on the other hand are less likely to be targeted by devious employees. This is because these companies have multiple accountants who are either able to weed out account tampering, or subscribe to a national accounting body which regulates their behavior. Their accounts are also audited on a periodic basis and this transparency discourages employees from stealing from the company.

Small business owners on the other hand are often caught between preparing accounts themselves and hiring less-than qualified accountants to record various transactions. However, the use of certified accounting services is a great step to prevent unethical behavior.

How do Accounting Services Discourage Account Tampering by Employees?

Small business owners have limited budgets to play with and therefore are unable to hire more than one accountant to handle bookkeeping responsibilities. Having more than one person prepare financial statements keeps the other in check and reduces tampering opportunities.

However, small businesses are more concerned with break-even and making ends meet, and hiring a second accountant is usually out of question. To eliminate the incidence of fraud, business owners should consider outsourcing their bookkeeping needs to specialized companies that provide accounting services.

This discourages swindling in multiple ways. The first is that physical cash/checks are separated from account handling. In a traditional set-up, accountants handle the finances of the company. If these accountants are not single owners themselves, greed is likely to steer them towards mischief. On the other hand, when third party accounting services are used, the fact that there is no handling of cash by the accountants eliminates the greed factor. Hence, there is no incentive to misrepresent accounts.

The second means of fraud elimination has its grounds in unintentional account misrepresentation. To err is human. However, accounting mistakes can be costly since the IRS can take notice and penalize the company for its oversight. A third party accounting service provider is likely to have more than one person manning the accounts, reducing the chances of mistakes.

How do Accounting Services Discourage Tampering by Owners?

There can be two types of motivation for owners to misrepresent accounts. The first is to cheat on taxes. The second incentive would only exist if the business is a partnership as opposed to a sole trader, where one of the partners withdraws without recording the transaction in the account.

In both scenarios, professional accountants are unlikely to support this behavior for various reasons. The major aspect that discourages them from falsifying accounts is the fact that if caught, these professionals risk losing their licenses, for good. This is an extremely strong disincentive for accounting service providers. The second is that there is no reason for the accountants to cheat since there is distinct separation between ownership and account handling.

BIO: Josh Rothenberg is the Vice President of Sales and Marketing at EZCFO. Josh is heavily involved in the day to day operations and plays an integral part in the building of the company and setting forth the standards to which the company operates. You can find out more about Josh by following his Google+ profile.

Form W-4

 A common practice for bookkeepers, accounting clerks, HR professionals and Controllers such as myself is to advise an employee, friend or relative on how to fill out their form W-4.  This is a mistake!  Unless you are a tax-preparer, you should not be handing out ANY tax advice, including the simple W-4 form.

Frequently over the years, I have had employees come into my office asking me if they should file (with me) a new W-4 form for whatever reason (change in marital status, new baby, etc.).  This is all innocent enough however the employee usually also asks, “How many deductions should I list?”  This is where the problem comes in; we should never hand out advice or tell an employee what to put down on the form.  I have also heard that some bookkeepers will even fill out the form for the employee – another huge mistake.  Fines and penalties can result from either of the two items described above.

The Basics

Federal form W-4 is used for individuals to identify their basic information and the number of Allowances (commonly referred to as deductions) for their employer to use in determining how much federal income tax to withhold from their paychecks.

While the IRS updates form W-4 each year, once a W-4 form is filed with the employer it is to be used until a new form is given to them by the employee, regardless of how old the current version is.  It is the employee’s responsibility to update their W-4 form.  As a personal practice, I generally inform employees at least once a year, in a short paycheck-stuffer memo, stating that I have blank W-4 forms available if the employee wishes to make any changes to their filing status.

Unless provided with a State version of the W-4 form (WT-4 for the State of Wisconsin), the federal form filing status and number of allowances will be used for state tax withholdings.

Best Practice

Without providing specific tax advice you can offer a generalization of how changing the number of allowances will affect an employee’s paycheck.  For instance, one could say that decreasing your number of allowances will result in more tax being withheld from your check and by increasing the number it will result in less tax being withheld.

One word of caution however is that if an employee wants no tax taken out, while they can do this legally, you should warn them about underpayment penalties and the form may be sent to the IRS if required.

The best practice is to ask the employee how it turned out for them last year, as far as how much tax they owed or how much of a tax refund they received.  Then, work from there in changing the number of allowances, but let them be the ones that tell you and fill out the form for themselves.  Another word of caution should be given when looking at the “How did last year work out for you” scenario is given is to ask if there will be anything changing this year.  Examples include a deduction dropping off your personal tax return, getting married, having a baby etc?  Sometimes these “life events” are not administratively thought of until it’s too late and a tax penalty comes around for underpayment.

A Savings Account? Really?

Over the years I have had several employees willingly enter in zero allowances, or have an extra amount of federal (or state) taxes withheld from their paychecks in order to receive a large(r) tax refund to be used as a Savings Account.  While this is legal, and somewhat common, my personal feeling is why let the government have use of your money all year long without giving you a dime in return?  I would much rather use the proper amount of allowances so that I neither have too much or too little taken out of my paychecks.  Certainly back in the days when you could have a savings account earning 5% I would stuff the money into that account versus having it withheld from my paycheck; this is a little more difficult now with little or no-return bank savings accounts.. My point is if you are diligent enough to put money away into a Savings Account of your own you should and not use the IRS form W-4 as a tool for a way to save money.  However, if you can’t save money, and there are so many of US out there who can’t, then this may be the way to go.

Employees have the ability to go to IRS.Com to get advice and to use an interactive tool to help them calculate the number of allowances.  A useful tool and takes the liability off of the bookkeeper!