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The importance of accounting in a business
The importance of accounting in a business
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Small Business Accounting: A Dilemma during Start-Up Operations
Small businesses oftentimes want to save on cost by not hiring professional accountants when they initially start their operations. They buy the latest accounting software, with small business accounting methodologies, and do the bookkeeping themselves by keeping track of their sales and expenses. When things get complicated, where taxes need to be paid and financial reports prepared for loan purposes, only then will they realize that they need professional help with these requirements. At this point, they start to think about hiring a professional accountant to give them good counsel.
But how do you look for a good one?
If you want someone who can advise you on - tax matters, business organization, preparation of financial reports, and payroll tax returns - you need a Certified Public Accountant (CPA) or an Enrolled Agent (EA) , who is a licensed tax expert. Routine accounting work that covers payment of bills, recording of day to day transactions, issuance of billing statements to clients, can be done by a bookkeeper or by you, if you have a basic understanding of accounting terms and terminologies.
A good accountant for you, is someone who has vast experience in your line of business and the necessary expertise in the accountancy profession. He is someone who understands the intricacies of the industry, and can help you not only with your books of accounts but in coming up with strategic business decisions. These would include - make and buy decisions, investment strategies, product development, and computerization, among others, to keep your company competitive in the market.
Start-up operations without professional help can proved more costly in the lo...
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...ffect on small business health care tax credit and reportorial requirements that are needed from employers. These reports indicate cost of coverage and employer sponsored health plans. Other changes would include revisions in Net Investment Income Tax, Medicare tax, and health coverage of insurers. The tax implication and changes in present and future regulations would be better understood by practicing Accountants who are well versed in this field.
Professional accountants would also be in the best position to advise you on the right accounting software for your business. You can discuss with him the type of software that is a best fit for the kind of operations that you do. As somebody who is up-to-date with his profession, he is the best person to advise you on changes in accounting practices that would have direct impact on your specific line of business.
ACA act recommend that employers should gather data for employees working hours and work details. Similarly, the process will greatly influence small organizations in terms of cost increase (Eibner et al., 2012). Most employers note that the regulations and the laws will contribute to financial storms and lead to increased costs in the years to come especially in terms of compliance expenses. However, employers are taking measures to respond to the ACA. Some organizations are considering inflating and adding a HDHP (Buchmueller et al., 2013). GMFC is considering paying penalties instead of subscribing to the health coverage. Although, other employers will continue to offer health care coverage despite the negative influences on their
The stereotypical image correlated to the account mirrors that of a public accountant. An individual working as a public accountant can expect to work as an independent third party to a multitude of companies. As this third party it is their duty to oversee financial transactions to ensure that the statements of not only the company, but also its’ supporting companies, correctly correspond and match up to the position, results and cash-flow of the clientele. This general quota outlining a public accountants job description is not the same for a private accountant. The main difference between a public and private accountant is that unlike the public and its handle on a multitude of accounts, a private accountant specializes with a certain company or field. With this specialization, a private accountant tackles setting up a system that records the transactions within the business. The recordation of the transactions is then generated into statem...
There are many health-related provisions that will take effect over the next four years. These new provisions include prohibiting denial of coverage due to pre-existing conditions, increasing Medicaid eligibility, creating incentives for businesses to offer health care benefits, creating health insurance exchanges, provide support for medical research, and subsidizing insurance premiums (Kaiser Foundation).
The healthcare reform ensures every individual in America has a government or private insurance to cater for their hospital bills. Besides this, 60% of America citizens have their health insurance covered by their employers. Most of these citizens are employees of small business or large companies. This means that the introduction of the healthcare reform has some differing effects on businesses. This paper seeks to examine the different effects that the healthcare reforms will have on both small and large businesses in the United States. The paper compares the impact of the current healthcare system on business with the impact that the proposed healthcare reforms will have on businesses (UDHHS, 2010).
There will also be a health exchange program for individuals who cannot afford employer insurance (Estes, Chapman, Dodd, Hollister & Harrington, 2013). This exchange program will include several changes such as limiting deductibles and waiting periods for coverage. The health exchange program will include a selection of different healthcare plans that the individuals can choose from that is said to be more affordable. The health exchange option will only be available to U.S. citizens and legal immigrants. There will be several changes to private insurance providers that will include several regulations for example, there will be no lifetime limits on coverage. Small businesses will also be able to purchase health insurance for their employees through this reform. Small businesses that provide their employees insurance will also be able to receive tax credits under certain conditions. Estes, et al (2013) states that employers with 50 or greater employees will face fees if even one employee buys insurance through the exchange. Employees that work for large businesses that do not sign up for coverage or say that they do not want any coverage will automatically be enrolled into the lowest costing plan by the employer. This reform is also going to introduce wellness programs into healthcare plans. For examples small businesses will be able to offer their employees rewards for participating in wellness programs by meeting certain health goals (Collin, 2012). The wellness programs will work towards keeping individuals in good health by offering the following programs for example: weight loss, smoking cessation and classes on nutrition.
- Small business owners can get larger tax credits if they want to pay for health insurance for their workers.
The ethical dilemma in this case is one that Daniel Potter is faced with. Daniel is a staff
From the previous discussion it is clear that mandated increases in health insurance participation which could have a significant labor market effects, causing changes in the market wage and in the number of workers employed. The recent substantial increase in malpractice payments and premiums for physician malpractice insurance has greatly increased the cost of employer provided health insurance. Due to these increases it is estimated that there will be a decline in employment, a cutback in the number of hours worked, and as well as reduction in wages of workers with employer provided health insurance. Providing health insurance threw mandates or payroll taxes entirely depends on if there will be a shift in the supply curve. The reason the supply curve shifts in mandates is because workers valued the benefits. There is no shift in the supply curve when it comes to payroll taxes for the reason that there is an implicit assumption that the benefit is not tied to employment. However, benefits provided through taxes could possibly be tied to employment and that would alter the supply curve. If the benefit is tied to employment, as it is in this case, it does not matter if it is funded through a mandated benefit or payroll tax. Workers will value the benefit provided by either one,
(c) a requirement that firms with over 50 employees offer coverage or pay a penalty, (d) a major expansion of Medicaid, and (d) regulating health insurers by requiring that they provide and maintain coverage to all applicants and not charge more for those with a history of illness, as well as requiring community rating, guaranteed issue, non-discrimination for pre-existing conditions, and conforming to a spec...
Accounting is basically a service activity. Its purpose is to provide quantitative information that principally used by the managers, investors, tax authorities, and other decision makers to make the financial decisions within companies, organizations, and public agencies. Accounting is also widely known as the “language of business.” An accountant measures, communicates, and interprets financial activities. They prepare financial statements or reports for individuals, businesses, government agencies, or other non-profit organizations. They use the accounting systems to categorize the expenses and income to the typical groups. They also keep tract of the money received or paid out to see if the transactions are accurate and complete. Accountants are familiar with the computer operation. They use the computer...
Managerial accountants need to use accounting information in seeing to it that they are able to plan, evaluate the company performance, manage risks and control the business operations in a manner that is deemed beneficial to the business as a whole (Caplan, n. d). This can be achieved through: having high standards of ethics in all situations; employing the techniques of management reports, budgetary control, and analysis of fund flows and financial statements; making prudent capital investment decisions; and maintaining continuous quality control systems.
In Financial Accounting accountants prepare only the annual finance statement of any organization and shows if the organization is going in profit or loss. But in Management Accounting the managers have to take the future decisions and steps by looking at the past financial statements. So Management Accounting is very important because one wrong decision can transfer the organizations path or the future. Management Accountants have a responsibility to moral qualities which has to be kept intact by using their various skills, which will ultimately help the shareholders of any organization to retain profits earned from the money invested. Strategy formation by executing plans, budgeting and forecasting, risk management and decision making all these are required as skills in Management Accounting. In Management Accounting a manager has to have knowledge on both the financial and non-financial terms of the business and operational sides of the business. Both the financial and non-financial items are reported and analyzed by the managers to come to any decision. Again, the corporate social performance is also analyzed and a report is made on that. They have to take care of the other points also, i. e, profit of the organization, the final and end users, i. e ,customers and their satisfaction levels, employees of the organization, environmental matters related to the
Accounting aids the government and organisations in decision making for their financial stability. This numerical data helps solve real life problems and contributes to how the economy and businesses perform.
An accountant makes sure that the Nation’s firms are run efficiently, the public records are kept accurately, and that taxes are paid properly and on time (“Accountants and Auditors”). Accounting is the study of how a business tracks their income, assets, expenses, and many other things for a period of time. They also do many other things like quality management, tax strategy, and health care benefits management (“Welcome to Careers in Accounting”). An accountant is crucial to the success of a business, without one the business tends to fail.
Accounting is one of the fastest growing fields in the United States It expands each time a new store, a factory, a filling station, or a school goes up, whether in a large city or a small town. In today's society, the demand for good accountants for exceeds the supply. As our country has expanded, business and industry have become more and more complex, so control here is very important. And control depends on a great deal of the bookkeepers and accountants who can analyze figues and advise management on what should be done. They are using more scientific ways changing money, figuring change, and collecting sales taxes. Moreover, department stores and other companies now have plants and offices widely scattered throughout the country. A new set of bookkeepers and accountants, is needed at each branch. I know there are many managements supervisory, and junior or senior executive positions are bing filled by people who started as accountants because accountants have the knowledge of methods and finance and comprehension of the fundamentals of business, and acc...