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Are You Wasting Time Without Even Knowing It?

10 Jan , 2013,
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No matter where you work or what your title is, it is imperative that you are good, accurate and efficient at what you do.  But we may be wasting time without even knowing it!  According to Entrepreneur, these are the seven common things may be keeping you from reaching your maximum productivity:

Overload on administrative work.

Are you doing things you don’t like or aren’t good at, or working for hours on something that falls under someone else’s expertise?  Perhaps looking at switching responsibilities within the company could help overall functionality, efficiency, and ultimately, profitability.

Procrastinating on quick tasks.

There are some small things that every business person must do- send out that email, schedule an appointment, sign up for a meeting.  But how many times do we look at something like that and think that because it is so menial, tedious and boring, we will put it off until later?  Doing that wastes time.  If it only takes a few seconds or minutes to accomplish, then do it right away.

Micromanaging employees.

As a manager or business owner, you need to “manage” your employees, not hold their hand through every task they need to do.  I heard a saying a few days ago that goes like this: “You should trust, but verify.”  And that is how you should be able to handle your employees.  You should trust your team enough to let them to their job without spending your time walking them through each and every step, but as a manager, it is your responsibility to verify that they are staying on task and producing good work.  But verifying takes a lot less time than hand holding.

 You let daily developments drive you.

You should spend most of your day working on the growth and development of your business, not putting out fires.  Of course, things happen that must be dealt with.  But at the end of the day, this shouldn’t be what drives your schedule.

 You don’t have a clear social media strategy.

This is simple- if you don’t understand what your game plan is, then most of your time spent on social media could be wasted time.

 You try to reinvent the wheel.

Spend time on promising endeavors, and learn when to move forward with a task or project, and when to say no and walk away.  You’re not quitting- you are being strategic.

 You repeat the same things over and over.

Do you find yourself answering the same questions repeatedly?  Or having to draft similar emails each day or week?  Then create a template that can be copied and possibility edited each time it’s needed.  You’ll save a lot of time by proofreading something than you would if you had to write it from scratch.  And, you can afford to spend more time on the template than you would on each individual email or response, so odds are, the quality of your responses will increase by using a template.

Accounting Packages For Small And Midsized Firms

Jan , 2013,
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Small business accounting needs have helped to make Intuit’s QuickBooks software program one of the most popular in the world.  There are other programs that can match QuickBooks’ utility for a smaller company, such as Peachtree, that have become interchangeable with QuickBooks.  But what about midsized companies with specific needs, such as large amounts of inventory or a complex employee setup?  Can their demands be fulfilled with a program like QuickBooks?

There’s no blanket answer, and it would depend on each individual company.  Some may be able to continue using QuickBooks as their accounting software, but other firms would need to consider switching to a larger program that can handle more detailed and sophisticated information.  There are many programs that can do just that, and one of the most popular is the suite offered by Thomson Reuters.  They can bundle their services so that you get Tax software, Accounting software, Time Tracking software and many other administrative tools that can help you become much more efficient in the workplace.  But these types of software programs often require a greater understanding of the accounting process in order to be done correctly, so the next question a business owner faces is: Should I keep my current bookkeeper (whether one is hired or the business owner does the work themselves), or switch to a professional who is educated, trained and experienced in this type of work?  That answer also differs depending on the company and business owner.

If you are interested in investigating your options, feel free to give us a call at 570-430-8062 and we can take a look at how we could best serve your needs, whether as your sole accountant or as a supportive resource on the side.  The type of partnership you choose is up to you.

The following article explores the different small business accounting packages in greater detail:

http://money.cnn.com/2010/09/21/smallbusiness/accounting_tools/index.htm?iid=SF_SB_River

Can You Prepare For Tax Season Now?

Jan , 2013,
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One word: Absolutely.  If you only need personal income tax returns done this year, or if you will need a corporate return prepared as well, there are things you can be doing right now that can save your accountant time and save you money when April 15th rolls around.

You may have received an organizer or checklist from your tax preparer that highlights various types of income that you will need to report, and expenses that you can deduct.  Obvious forms of income related paperwork include W-2’s, 1099’s, etc.  But there are less popular types of income that you will need to report as well, and it is imperative that you include all of this in the packet that you give to your accountant, so that you can avoid penalties and interest on unreported income.  It’s also just as important that you include all of your deductions as well- and be sure to have documentation for anything that you want to deduct!

If you are involved in a corporate tax return, be sure that your financial statements are correct and thorough, and make sure to include an organized assembly of all necessary backup paperwork.  Having these papers in some sort of order will help your accountant to double check your Balance Sheet and Profit and Loss Statement more efficiently, saving you a great deal of money.  If you need help making sure your financials are in order before tax time, it might be wise to hire a bookkeeper to compile them for you.  Bookkeeping rates are much lower than rates typically charged for completing tax returns.

If your tax return preparer does not provide you with a yearly organizer, you can access some sample checklists online, and from that, you could make your own.  Or, switch to Wentworth and Associates so you can be on our mailing list of yearly, personalized tax organizers.

As the new year begins, life gets busy and filing paperwork is not a priority, so get a jump start now so you can avoid paying for it in the spring!

Contact us at info@wentworthandassoc.com to set up your tax meeting.

Credit Cards- How To Save Money And Earn Free Money

Jan , 2013,
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In light of the debt crisis that has occurred in recent years, using credit cards to finance your small business may seem taboo.  But, if used correctly, credit cards can actually save you hundreds to thousands of dollars in financing costs, and even give you free money.  Want to know how?

Before applying for a small business credit card, make sure that your personal credit is near perfection.  Credit card companies see the small business as its owner, and will often issue full credit checks.

Just because credit cards can save you money, be sure to avoid leveraging credit too early.  Studies show that for every $1,000 in credit card debt that a small business takes on, its’ chances of surviving long term fall by about 2%.

Once you find your business in a position to take advantage of credit cards, look into whether a personal or business credit card (or both) works better for you.  Personal credit cards are not allowed to increase rates due to 60 days’ payment delinquency, but business cards are usually not restricted.  Always check the rules and regulations of the credit card issuer before making any commitment.

One big mistake businesses and individuals make is that they don’t take advantage of credit card rewards.  You can accumulate hundreds of dollars in free points that you can use for a free flight to a client or to help pay for infrastructure or a marketing campaign.  Even if you aren’t using your credit cards to avoid financing costs, sometimes it makes more sense to purchase large items using a credit card instead of cash or check.  As long as you pay the balance on time and in full, you won’t incur any interest fees, and you can gain points that equate to free money.

Some cards offer introductory zero percent rates that can help you save hundreds of dollars if you were going to get a loan from a bank, as long as you can pay off the balance within the given amount of time, usually 15-18 months.

If you have multiple credit cards, you can take advantage of the “island approach”.   Some purchases are better used on certain credit cards, such as large purchases on a zero-interest personal card for funding.  Smaller purchases that you can pay off immediately are better used on a rewards card that probably has a higher interest rate.  That sky high rate doesn’t matter as long as your balances are always paid on time and in full so that you don’t need to fall victim to the credit card rate.

As long as you take on financing very responsibly and constantly monitor credit card balances and due dates, you can stretch your company’s money to help you grow even faster.  And who doesn’t need help doing that?

How Long Should You Keep Your Tax Returns?

Jan , 2013,
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Once tax season has come and gone, your job as a taxpayer may not yet be finished. You’ll want to keep records and documentation on hand in the event that the IRS returns.

Here are some tips to help you figure out which records to keep and how long to keep them:

  • As a general rule, keep your tax records and supporting documentation until the statute of limitations runs out for filing returns or filing for a refund. For most taxpayers, that means you’ll want to keep those records for three years following the date of filing or the due date of your tax return, whichever is later. So, for example, if you filed your 2011 tax return on April 17, 2012, you’ll want to keep those returns and those records until April 17, 2015.
  • If you don’t report all of the income that you should report exactly (if you omit more than 25% of the gross income shown on your return), the statute of limitations is extended. You’ll want to keep those records for six years.
  • If you file a clearly fraudulent return or if you don’t file a return at all, the statute of limitations never actually runs out. In that event, you’ll want to hold onto your records, well, forever (really, it’s much less work to simply file).
  • “Supporting documentation” for your tax returns includes not only your forms W-2 and 1099, but also bills, credit card and other receipts, invoices, mileage logs, canceled, imaged or substitute checks, proofs of payment, and any other records to support deductions or credits you claim on your return.
  • If you claim depreciation, amortization or depletion deductions, you’ll want to keep related records for as long as you own the underlying property. They include deeds, titles and cost basis records. Similarly, if you claim any special deductions or credits, you may need to keep your records a little longer than normal (for example, if you file a claim for a loss from worthless securities or bad debt deduction, you should keep those records for seven years).
  • If you have employees, including household employees, keep your employment tax records for at least four years after the date that payroll taxes become due or are paid, whichever is later. This should include forms W-2 and W-4, as well as related pay information including benefit forms.
  • You’ll want to keep your records organized — I recommend arranging them by year — and store them in a safe place.

For those of you trying to go “paperless” or who don’t have an excess of storage room in their house, the IRS has allowed scanned receipts and documents since 1997.  So it might be better to scan your return (in its’ entirety) and save a copy electronically.  Just make sure there’s a backup of it somewhere in the event the computer crashes before the statute of limitations runs out.

You just need to ensure that your scanned or electronic receipts are as accurate as your paper records, and you must be able to index, store, preserve, retrieve and reproduce the records. In other words, you need to have your records organized and be able to produce them in hard copy form if needed.

One quick word of warning: Even if records aren’t needed for tax reasons, you may need them for other reasons. Be sure to check with your mortgage company and tax professional before tossing important records.  (http://money.msn.com/tax-tips/post.aspx?post=cad3364a-93e6-40e7-862c-a787185d7ae6)