Monthly Archives: May 2017

How to Define Accounting for Business

A strong company can attribute some of its success to its accounting. Without accounting, it would be hard to keep track of your business’s finances and profitability, and you might not know exactly how much money is coming in or going out.

Unless you are well-versed in finance yourself, your business will likely need to enlist the help of a professional accountant. Here’s a breakdown of who accountants are and what they do for your company.

The American Accounting Association defines accounting as “the process of identifying, measuring and communicating economic information to permit informed judgments and decisions by users of the information.” Logging a business’s account payable, accounts receivable and other financial transactions, typically using accounting software, is often how it’s done.

“Accountant use the work done by bookkeepers to produce and analyze financial reports,” said Stan Snyder, CPA. “Although accounting follows the same principles and rules as bookkeeping, an accountant can design a system that will capture all of the details necessary to satisfy the needs of the business – managerial, financial reporting, projection, analysis and tax reporting.”

In the United States, most accountants abide by the Generally Accepted Accounting Principles to present a company’s financial information to those outside of the company in a format that everyone can understand. There are different sets of accounting standards for companies that operate overseas, as well as for local and state government entities.

Harold Averkamp, CPA and owner of Accounting Coach, said accountants also provide a company’s internal management team with the information it needs to keep the business financially healthy. Some of the information will originate from the recorded transactions, while some will consist of estimates and projections based on various assumptions, he said.

Accounting ratios help uncover conditions and trends that are difficult to find by inspecting individual components that make up the ratio, and formulas like this help accountants to come up with a company’s status and projections. Accounting ratios are divided into five main categories:

  • Liquidity ratios: measure liquid assets of the company versus its liabilities
  • Profitability ratios: measure organization’s ability to turn a profit after paying expenses
  • Leverage ratios: measure total debt versus total assets and gauge equity
  • Turnover ratios: measure efficiency by comparing cost of goods sold over a period of time against amount of inventory that was on hand during that same time
  • Market-value ratios: measure company’s economic status compared with others in industry

Cloud Computing: A Small Business Guide

Cloud computing can be confusing. If you’re considering a cloud service for your business, here are three questions to ask:

  1. What type of cloud computing does your business need?
  2. How much are you willing to pay?
  3. Can you deal with the security risks?

To help you answer these questions and better understand the cloud, here is our cloud computing guide for small businesses.

Cloud computing gives users access to data wherever they have an internet connection. In today’s ever-changing business climate, it’s critical that small business owners get what they need right when they need it, whether they’re on their computers, tablets or mobile phones – or in the office, out in the field or on the road. This is exactly the convenience that cloud computing provides.

Cloud computing is an umbrella term for different types of cloud services, including these:

  • Cloud storage – stores and backs up your files for regular access and for sharing and syncing them across devices.
  • Cloud backup – similar to cloud storage, but primarily used as a backup source in the event of a crash, cyberattack or other data loss.
  • Software as a service (SaaS) – uses the web to provide a service, such as Office 365, Google Apps, QuickBooks Online and Salesforce (may also be called Platform as a Service).
  • Cloud hosting – facilitates all types of information sharing, such as email services, application hosting, web-based phone systems and data storage.

For small and midsize businesses (SMBs), the benefits of cloud computing are endless. Cloud computing saves businesses time and money by boosting productivity, improving collaboration and promoting innovation.

Businesses use cloud computing to access information anywhere with any compatible device. Rather than storing information on your computer or a server in your office, cloud computing stores data on the internet. It works by making information available from a central web-based hub that gives anyone with proper credentials access from any location with an internet connection. Cloud computing also syncs data for all devices connected to the cloud, keeping them updated with real-time information.

In the cloud environment, users can access all types of files, use applications as though they were in the office, and even collaborate remotely while working on the same project or presentation on their device as someone on the other side of the globe. Even if you’re away from work or your office server is inaccessible, data in the cloud is always up to date and available wherever, whenever.

Cloud-computing services can range from data storage to functional programs, including accounting, customer service tools and remote desktop hosting.

Business owners use three types of cloud services to store their data and provide services: public, private and hybrid.

Public cloud: A public cloud service is built on an external platform run by a cloud service provider. With this off-site cloud service, users get their own cloud within a shared infrastructure. The provider offers everything from system resources to the security and maintenance of your cloud system. Since it is managed by an outside company specializing in cloud services for a wide range of customers, a public cloud system is great for organizations that want more elasticity, cost-effectiveness and the latest technology.

Private cloud: A private cloud service is a cloud platform built within your own walls on your own hardware and software. Since a private cloud is managed by your own internal IT team, it is ideal for businesses that want exclusive access, more flexibility and greater control over their cloud. To use a private cloud service, however, organizations build their own data centers, making it a costlier cloud option.

Hybrid cloud: A hybrid service employs both private and public clouds. In a hybrid cloud system, an organization’s own IT team manages part of the cloud in-house and the rest off-site. For instance, a hybrid cloud system is perfect for an organization that wants to manage business-related data (such as customer files) in-house but wants to store less-sensitive information with a third party.

The cost of cloud computing varies greatly, depending largely on the type of cloud service you need.

For instance, cloud storage and file-sharing services like Dropbox start with free accounts, but paid plans with advanced features cost $20 and up per month per user. Cloud backup and recovery services like Carbonite cost $59.99 per month.

Amazon Web Services, on the other hand, offers a wide range of cloud services, letting you use its data centers for free or on a pay-as-you-go basis.

Cloud-based software pricing also depends on the provider and industry. Other factors that affect SaaS pricing include the number of users, how you will be launching and distributing the software across the company, tech support, and contract terms.

The drawbacks of cloud computing are twofold. First, implementing any new type of technology will require training personnel and establishing an effective troubleshooting system for during and after the launch. You will also have to address any hesitation among your employees, especially those who are unfamiliar with cloud technology.

Another concern about cloud computing is its security risks. Cyberattacks are at an all-time high, and no business is safe. Business owners and decision-makers primarily worry about sensitive data in the cloud and their vulnerability to unauthorized users. While an organization’s cloud is typically accessed with designated usernames and passwords, verifying user identity itself remains a top concern.

In weighing the risks of cloud computing versus its benefits, business owners are especially concerned about how their information is kept safe in the cloud. The key is finding the right cloud service provider and understanding its contingency plans in the event of a security breach – as well as having your own.

Facebook for Business: Everything You Need to Know

As one of the biggest online social networks, Facebook is practically a necessity for businesses of all sizes. But just because it’s popular doesn’t mean it’s easy to navigate. The platform has seemingly endless options for everything from page customization to paid advertising, and it can get complicated for anyone who’s unfamiliar with how it works. If you’re ready to take on Facebook for your business, here’s everything you need to know to get you started.

Facebook is a social networking service that was launched in February 2004 by founders Mark Zuckerberg, Eduardo Saverin, Dustin Moskovitz, Chris Hughes and Andrew McCollum when they were students (and roommates) at Harvard. It started as “thefacebook.com,” a website that was available only to Harvard students and soon expanded to Ivy League universities before opening up membership to students at other colleges and, later, high schools. Now, the service is available to anyone age 13 and older, and has more than 1.55 billion monthly active users as of September 2015, according to the Facebook newsroom.

Facebook went public to investors in 2012, and the company now owns Instagram, another popular social media platform, as well as the widely used chat app WhatsApp, among other products.

Before you can become a Facebook page maven, you need to have solid knowledge of at least some of the basics of using Facebook. To create a Facebook page, you need to have a personal Facebook account, so if you don’t have one already, you’ll need to create one. You don’t have to use your Facebook account for personal reasons if you choose not to, but you do need to be familiar with how the platform works in order to navigate and manage your Facebook page.

If you’re completely new to Facebook and want to learn more about how to use it on a personal level, check out Facebook’s Help Center. This resource will give you details on filling out your profile information, setting up privacy settings, adding friends, and more. For basic Facebook use and business page purposes, however, here is what you need to know:

Creating your Facebook account

To sign up for Facebook, you’ll need to enter some basic personal information, including your first and last name, your email or mobile phone number (you’ll have to enter this twice for confirmation), a password that contains at least six letters or numbers and includes special characters like punctuation marks, your birthday and whether you identify as male or female. Once you’ve filled out the necessary information, click the green Sign Up button to continue creating your account. You’ll then receive either an email or text message (depending on which one you used to sign up) with instructions and a code so you can confirm your account creation.

Twitter for Business: Everything You Need to Know

Social media is an important tool for any business owner, no matter the size and scope of the business. Learning to communicate with your demographic, albeit in 140 characters, can be useful when working with your customers. Learning more about Twitter can only benefit your business.

Twitter is one of the top websites in the world, and is currently ranked No. 8 domestically and globally, according to Internet analytics company Alexa. It has more than 313 million active monthly users, per the company, and 82 percent of those users are active on mobile platforms.

Having Twitter as part of your social media toolbox can propel your business’s legitimacy.

“There are many reasons why a small business needs a social media presence. The most practical reasons have to do with your credibility and discoverability,” Leah Paul, director of marketing at Mediabistro said to Business News Daily in another piece. “It’s important because it’s expected, like having a website, a phone number and an email address.”

Keeping your account(s) organized needs to be a priority. There are a number of native and third-party clients you can use to manage your tweets.

Twitter and Hootsuite have mobile apps for use on your smartphone or tablet, and allow you to add multiple user accounts at once.

Social media plays multiple roles when it comes to business, including yours. There is a place for it in any size business, as it can reach multiple demographics and spread your company’s message. As a business owner, you should carefully consider how Twitter will fit into your overall marketing plan.

Twitter offers tools specifically for marketing and your business.

If you’re working out what is important and works on Twitter (especially in marketing) consider hashtags. These words or phrases gives users the chance to tag an identifying word that groups hundreds (or thousands) of tweets together. Hashtags are searchable and offer the perfect companion for live events.

Hashtags are a great way to make the content you share on the platform visible to users beyond your own followers. There are many highly popular hashtags that generally all active Twitter users are familiar with, like #FollowFriday or #ff, which encourages your followers to reach out to other users you admire or work with, and #ThrowbackThursday or #tbt, with which many users post attention to your vintage or childhood photos and memories. You can also create your own hashtags to draw brand or to events you may be throwing, though it comes with the possibility it may not catch on. Many brands latch on to already trending topics to contribute to the conversation or sell their product.

It’s important to make sure you use hashtags that are relevant – for example, if you were tweeting about starting a business and it happened to be a Friday, you might use the hashtag #entrepreneurship, but using the #FF hashtag would be inappropriate.

Be wary of how many you use, the more hashtags you use, the less likely people are to interact with your content, because they’ll find your posts spam-like.

Hashtags or phrases can trend. Trending topics means people are talking about something at a very high rate. Often, these topics are identifiable with hashtags, but they can also be words or phrases related to the subject. As previously mentioned, you can see the current trending topics on your Twitter home page in the trends box on the left-hand side.

For brands, latching on to trending topics is a good way to garner interest and possibly a few followers – just make sure you do it the right way. Only use trending topics in your tweets if those topics are relevant to your brand, and make sure you use them appropriately.

If you’re not sure why a certain topic is trending, do some research to ensure that you don’t do something to offend your audience, like making light of a serious situation or saying something politically incorrect. Users typically identify disingenuous marketing if brands are just tweeting to tweet.

It should be noted that it’s best to stay away from breaking news stories surrounding tragedy, including celebrity deaths, or major tragic historical events (like 9/11). Use your best judgement, and always choose tact when deciding to integrate marketing with trending topics.

This feature will expand the storytelling experience for brands and businesses.

“Visual assets are core to how a brand tells its story, and it’s no secret that marketers are giving video more importance in their creative asset mix and shifting dollars from traditional TV to digital video,” Sofia Hernandez, executive vice president at MRY creative agency told Business News Daily.

“For businesses which rely on strictly organic posts, this feature will allow them to tell their story over two minutes,” added Jenny Marder, director of social media at Red Tettemer O’Connell + Partners in the same article.

These videos can be useful for product demonstrations and a more thorough explanation of product benefits and functionality, Hernandez said. Videos such as beauty tutorials and tech gadget demonstrations will drive users to purchase, she said.

Marder emphasized the importance of providing a call to action, in either the video or the tweet, to give users a reason to interact or share the content, thus increasing brands’ views and engagement.

Direct messages have evolved and changed over the years, which is especially true for brands. The way you interreact with your clients is important for troubleshooting issues and handling problems at multiple locations of your business.

Direct messages (DM) allow you to privately chat with someone one on one. If a customer has a question, they can ask via a DM. There is no character limit on DMs, which gives you the freedom to explain and help in as many characters as you need.

By default, only users you follow can send you DMs. Now, you can set up your Twitter account to receive messages from anyone, making it easier for all customers to contact you. Simply go to your Privacy Settings and enable “Receive Direct Messages from Anyone.”

Twitter has also launched a new feature that filters messages from users you don’t follow into a separate Requests inbox. This lets you choose and prioritize which users to engage with first and helps keep your messages organized. Learn more about the Requests inbox.

DMs also include location services. if a customer has an issue, he or she can share their location with the business. The customer can reference a location even if they’re not physically there – which would be helpful in the case of making reservations or placing a to-go order at a restaurant, for instance, the article said.

Even if you do not run a restaurant or takeout business, the use of the location tool may be helpful when learning of outages, issues at the certain location or other location-based issues that need to be solved.

The feature is also available through Twitter’s Direct Messages API, currently in private beta, and is powered by Foursquare’s location data.