How to Choose the Best Accounting Software

Accounting is an integral part of any business. Even small businesses have to observe strict and efficient accounting practices in order to make sure that the data received about the company's progress are true and reliable. That is why to make things more secure, the use of accounting software has to be adopted.
Here are important tips that can help any business owner get the best and most suitable accounting software.
1. List which common accounting software features are needed.
These features may include:
-Inventory management
-Sales tracking
-Contact management software
-Merchant account support for credit card payments
-Budgeting and estimates
-Payroll
-Business tax reporting
There are also accounting soft ware packages that are especially designed for industries like construction, manufacturing and wholesale distribution.
It would also be helpful to talk to others about accounting soft ware. Before purchasing accounting software, it will be best to ask people who are already using the said software. Their insights and experience with the software will be enlightening.
2. Know more accounting software feature choices
A good feature of accounting soft ware is having modules that can be added to the existing software after a while. However, if this is not possible, it would be good if the software can be upgraded easily to a more capable version.
It will also be helpful if the accounting soft ware is supported by the business' bank. This would definitely save time and effort for the company.
The user should also be asking if the accounting soft ware is online. Being online means it is web-based that runs securely through an internet browser. This would prove convenient and time-saving especially at times when there is a need to access data from another computer.
Access to data is also another thing to be considered. What is the extent of the accounting soft ware accessibility? Can all people gain access to everything that is being stored in the software? Or maybe, there are only certain information that can be displayed to the public.
The accounting software must have a free trial so the user can experience it.
3. Accounting software account options
It may be natural for manufacturers of accounting soft ware to charge fees for technical support. But ideally, the support through email and phone should be given for free during the first few months as the user still tries to get acquainted with the installation and use of the software.
4. No payment for features not being used
It would not be wise for a business owner to buy accounting soft ware that has services and features that are of no use to the company. Naturally, the software that has more features is actually more expensive. So, if the accounting software needed is just very simple, then it would be alright to buy the one which provides only the necessary features.
5. Accountant vs. accounting software
An accountant can do a lot of relevant tasks for a business. However, any good accounting soft ware can deliver the reports needed by a company. And these reports can be forwarded to an accountant who is hired only on a contractual basis. This way, the company is able to save on professional fees.
Accounting soft ware should not replace the accountant especially for legal issues and concerns. However, these definitely save money for the company.

Why Your Business Needs an Income and Loss Statement

The one thing that is going to keep any business running is money. Every business need cash in order to keep their operations going and in order to get money all business need to be profitable all the time. However, how do companies make sure that they're earning money and not taking a loss over a certain time period?
A profit and loss statement is what many organisations use in order to find out if they're on the right course. It's basically an announcement that shows a company what expenses it has made, just how much revenue they have brought in and how much cash it has made or lost during a certain time period, which could be between several months to a year.
What type of business would use a profit and loss statement? Essentially each and every company in the world must have some sort of statement that they receive on a regular basis that shows them what their expenses, revenue and overall net gain or loss continues to be a duration of time. It doesn't really matter if it's a large business or a small one.
Generally speaking, very large businesses that have a long history of being profitable will still use these statements in order to make sure that they stay on the right track. To include in that, really small businesses and those that are just getting started should truly use them as well since they are the most vulnerable since they generally have the lowest amount of cash.
When should companies get a profit and loss statement? It truly depends on the size and vulnerability of the company. Large companies that have a lot of cash available can get away with receiving these statements every quarter or so, however, that won't work out for smaller businesses.
Smaller businesses that are very vulnerable and don't have a lot of cash on hand may wish to receive these statements frequently. That is because they're more vulnerable and need to make certain that they're profitable at all times and, if they're not, they have to make some very quick changes in order to turn things around.
Where can businesses go in order to get profit and loss statement? This can be something that businesses are capable of doing themselves, or it can be outsourced to another company that handles financial matters. Having it done in-house might be alright for some companies, however, it turns out to be unprofitable in the long run.
A company's best bet is to outsource the financial responsibility of putting together these statements to a company that specializes in doing so. This is because a business that does that will not have to pay employees to get the job done, which saves the organization time and money. To add to that, companies that specialize in providing financial reports will provide a business with the best and most accurate data.

New Federal Law Provides Income Tax Relief Assistance to Americans in Need

Last year signed into law by President Obama on December 17, 2010 was the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (2010 Tax Relief Act).
120 Day Extension
As an interest to aid to U.S. Taxpayers who have been contacted by the U.S. Internal Revenue Service, the Federal Government is granting an automatic additional 120 day extension to respond to the IRS inquiries by way of simple written request. This added four month extension to respond without additional tax penalty or accumulating interest will continued to be allowed by way of this Act only through the year 2012.
This added time allows the taxpayer needed reasonable time to retain a Tax Professional: Attorney, Certified Public Accountant (CPA), or an IRS Enrolled Agent (EA) to handle their outstanding income tax issue and comply with the IRS filing requests or payment requests to date. With this Professional Tax Relief engagement the taxpayer can readily have the IRS stop any Wage Garnishments, Account Levies, or Property Liens that may have been locked in place by the U.S. Department of Treasury right away in requesting this 120 extension. Then within this time the Taxpayer can be brought in Compliance with the IRS by simply making outstanding filings without payment at this time, or arrange a payment plan addressing payments due with Tax Penalty Abatement, or seek an Offer in Compromise Settlement based upon ability to pay.
This professional Tax Relief as explained can provide instant monetary relief from IRS, Wage Garnishment, Levies, & Liens and also relieve one from further current collection efforts of the U.S. Department of Treasury- IRS.
Some other aspects of the 2010 Tax Relief Act that addresses the common taxpayer are:
Tax Rates
An Individuals' taxable income will continue to be subject to six tax rates at 10%, 15%, 25%, 28%, 33% and 35% through 2012 with the expanded 15% bracket for married joint filers that will provide marriage penalty relief is also extended through 2012. Estates' taxable income will continue to be subject to five tax rates of 15%, 25%, 28%, 33%, and 35% through 2012.
Qualified Dividends Rates & Capital Gains Rates
In addition, the 2010 Tax Relief Act extends the 0 and 15% rates on adjusted net capital gains through 2012. Also extended is the treatment of qualified dividend income as adjusted net capital gain, taxable at the same 0 and 15% maximum rates through 2012. The Act extends the 0 and 15% Alternative Minimum Tax rates on adjusted net capital gains through 2012 as well in less common circumstances.
Employee Payroll Tax Reduction
The employee portion of Social Security taxes has also been reduced from 6.2 to 4.2 percent for 2011 wages only at this time. The employer portion will remain at 6.2 percent. A similar rate reduction applies to the railroad retirement tax as well.

7 Benefits of Outsourcing Payroll and Tax Administration Services

Payroll outsourcing companies is a type of PEO (Professional Employer Organization) services companies, although they have chose to specialize on providing payroll and tax administration services, which generally goes hand in hand, anyway. Here's why you should consider payroll outsourcing.
1. Cost reduction.
Just how much do you pay the entire Human Resources department? Companies operating in small to medium scales may not even have an HR department, or even an HR staff. They would most likely have one payroll administration office on-board. The salary of a payroll administrator may range from $8,000 to $12,000. You also have to consider one of your employees spend on encoding payroll information and what you pay for the technological support for payroll. Large scale companies have an entire IT department as back-up and small business generally have one computer guy or even hire a moonlighting IT expert every once in a while. Compare the total payroll-related costs to what you would need to pay for the services of a payroll outsourcing company.
2. Focus on core operations.
Fact is, payroll work is mundane and even the most loyal employee will feel so, even when she doesn't complain out loud. Even when you get someone who doesn't "mind" doing the payroll work, you can be sure that time spent on anything not payroll-related is time well-spent. This is because payroll work is by no means a strategic; it doesn't play a role in branding or in increasing market share or in generating product exposure. With payroll outsourced to third parties, your staff will be able to focus on core operations.
3. Compliance.
Payroll outsourcing companies also offer tax administration services and these are generally bundled with payroll services. This means that they get to carry out filing and tax-related work. What's even better is that they know the ins and outs of the tax laws of your state so you can be sure that compliance to government tax rules and regulations is checked. You wouldn't want frequent tax-related clashes with the government, would you?
4. Good feedback from employees.
Let's face it, nobody likes receiving paychecks which are incorrect. It is a hassle to have to consult the payroll officer about it. With outsourcing payroll work, you are reasonably sure that you are acquiring the services of people who can do the payroll-related tasks excellently.
5. Accountability.
Alright, so you might have hired experts, but the truth is, glitches may not be altogether avoided. Paychecks may be delayed and there could be problems with paperwork. However, you do not have to deal with the headache; it's up to the payroll services company to take care of the problem. Now, if you don't like what the payroll company is doing, you can sue them or find another one. How easy do you think will it be to fire a payroll officer which you feel is not doing a good job at all, what with the labor laws of the country? With outsourcing, you get a lot of options.
6. Speed.
Payroll companies have what it takes to get your payroll tasks done, in terms of industry knowledge, legal expertise and technology. This means that payroll processes are completed at top speed. Even when you are a small business who sometimes hires part-timers or seasonal workers, you can be sure payroll companies will have systems that can assist with that.
7. Security.
A lot of business operators aren't comfortable with the idea of third parties' gaining knowledge about an aspect of their operations when the truth is payroll companies are good at curbing security problems.

The Power of Virtual Accounting

The coming to age of cloud computing has brought about a large number of commercial opportunities and efficiencies available to the business community, particularly small and medium enterprises (SMEs). One of the opportunities and efficiencies is virtual accounting or, as some protagonists like to put it - cloud accounting is one of the strong emerging service offerings. What started as a theoretical computing possibility is indeed a reality today.
Accounting controls have progressed from the days when it was considered a specialised and an awkwardly difficult task, fraught with illogical principles that undermines business freedom. Accounting packages such as peachtree, Sage, MYOB and so one have made very useful contributions in reducing the difficulty of day-to-day accounting, but these programmes appeared to add to the learning curve and accessibility is limited to the computer system that they are installed on.
Some rather slick and simpler solutions are emerging in the market based on cloud computing principles. The ability to access your books of accounts and useful performance reports at anytime and from anyplace with internet connectivity and the simplicity of use that virtual or cloud accounting solutions bring has accelerated the uptake. Users are instantly amazed at how easily they have been able to manage their books by themselves or through a part time accountant working remotely. This brings additional opportunities of efficiency and reduced.
Clearly, the economic benefits of virtual accounting significantly outstrip its costs by several multiples. Like most shared services, the installation, support and maintenance costs are spread across the number of users bringing the unit costs down over time. The commoditisation of accounting computing power as an anytime and anyplace services has been helped in no small measure by advances in telecommunications. Significant improvement in wired and wireless communication bandwidth, the ubiquitous WIFI access in major cities in Europe and the smart phone revolution, have made virtual accounting the best solution for SMEs.
Whilst technology and the growth of personal wealth have delivered a range of possibilities, it is not an excuse for carelessness. Accounting is no less a serious matter than it was 50 years ago. Diligence is still required to ensure that accounts reflect a true and fair view. The level of regulatory scrutiny and the keenness of tax authorities to grow national revenue in the challenging economic circumstances of today cannot be over emphasized. Users of virtual accounting services must ensure that their records are accurate and complete.
Simple steps to harnessing such strengths include:
1. Using reminders to plan their accounting and administrative tasks including invoicing, bank reconciliation and updating the books account.
2. Using the invoicing and chaser facilities (e.g. email reminders) on virtual accounting solutions to manage their business operations and working capital.
3. Accessing their account reports regularly either directly or through part time accountants to ensure that the books reflect what they expect.
4. Regularly using the various reports and aids e.g. working capital ratios, sales and profit graphs, that virtual accounting solutions instantly generate to make business decisions
5. Utilising the account closure and financial statement generating facilities and tax filing plug-ins to generate their accounts for regulatory and tax filing purposes.
6. Keep your password strong, safe and secure
The simple steps help ensure that business are well controlled and that regulatory and tax obligations are met in a timely manner.
Recently, the UK tax authorities and the International Accounting Standards Board requirements for companies to file accounts using the eXtendable Business Reporting Language (XBRL) came into play. Traditional accounting packages have had to find add-ons to further process the accounts generated in order to comply. This is an added cost, but virtual accounting solutions are designed to be compliant.