Accounting principles are the basic assumptions, rules of operation, and essential characteristics that make up the framework for the construction of accounting financial statements.
Long ago, I was perplexed to discover that there was no “set” of accounting principles that was presented in one form such as you might find in the Bill of Rights. This is not to say that the principles are incomplete or vague, it only means that the definitions of accounting principles can be presented in various formats, which may lead to confusion for some people, especially beginners.
Be that as it may, accounting principles are absolutely necessary when preparing financial statements, just as the rules of a particular card game make the card game possible in the first place. Accounting principles are like the glue that holds the accounting process together. For example, financial statements have an overall objective, which is to provide the user of the statements a useful tool for making business decisions.
In order to be useful, the accounting information must have certain characteristics, such as being dependable and practical. To be dependable, the accounting information must be unbiased, accurate, and verifiable. To be practical, accounting information must be predictable, prepared in a timely fashion, and be able to provide meaningful feedback. Additional characteristics are that the accounting information must be consistent, comparable, serve a utilitarian need (such as cost/benefit), and make a material difference.
Besides characteristics, certain operational rules are established as to when revenue and expenses are reported; how expenses are matched to revenue; what to do when a choice can be made that might overstate or understate figures; and, what information should be disclosed so that the reader will fully understand the circumstances under which the information is being presented.
There are also basic assumptions that the reader can count on, such as: the information is related to the business entity only and doesn’t have any unrelated information mixed in; the business is a going concern and won’t cease operations soon; the financial information presented is measured in specific time intervals such as a month, quarter or year; the financial information is using a certain unit of measure such as dollars, not board feet, etc.; the information is presented at historical cost, i.e., when received, paid, or incurred; and, the method of accounting being used is double-entry and not some other method.
These are accounting principles as opposed to accounting standards. An accounting standard is an agreement as to how an accounting issue will be treated. For instance, a standard might state what type of inventory system is appropriate to use for a certain type of business; how capital leases should be recorded; how many years intangible assets should be amortized; what methods of depreciation should be used, and so on. There are literally thousands of accounting standards that have been issued over the years. These standards are constantly being revised or discarded as they become outdated.
If you want to play the accounting “game of cards”, you must become familiar with the “rules of the game”, which are accounting principles and standards. If you choose to not play by the rules, you do so at your own peril, as we have seen recently in the U.S. corporate accounting scandals.
Saturday, December 23, 2006
Online Accounting
Accounting in USA has seen lots of change. There was a time when the accounting was more of book keeping done in huge ledgers and was the purview of select few. It’s not so anymore. Accounting is much more widely accepted as a business function and general people also look for the accounting details of the firms they are associated with. Also lot more transparency is required now. Keeping in line with the development of IT and other technologies, the accounting is also now based on internet and has taken wide strides. Online accounting services, viewed as merely experimental only a few years ago are now becoming the run away business.
As such accounting industry as been little slow to adopt the newer technology and has not left fully its love for the pen and pencil work.
The SU accounting industry has seen new trend of outsourcing its work now. All these have forced the industry to adopt the Online Accounting. The internets as well as other technologies are used now to build more efficient book keeping systems. Also it’s becoming more cost efficient for larger firms to outsource the work. Outsourcing is very much easier with work being delivered online. It’s much more cost effective as well as fast also.
The shift from the practice where clients paid the accounting firms as per the billable hours to a fixed fee based system is forcing the accounting firms to deliver efficient work in cost effective manner. This means that they can not any longer cover their inefficient work by merely putting in more time into the projects. This has favored the Online accounting practices much. Value billing has forced accounting professionals to become more efficient.
Online accounting very effectively cuts short the time taken to transfer the time taken by information exchange between the clients and accounting firm. The seamless transfer is far more efficient and much faster. The accounting firm has dynamic access to the sourcing documents of the clients firms and can access anytime any information it requires from its clients side. The online accounting system also allows the accounting firm access to client data from far away locations at the a few clicks on the internet. The time sensitive financial data is readily available to the accounting firm.
Other then the speed and cost of services, online accounting enables better customer service and more reliability and trust. Accounting firms recently have been exposed as in cahoots with some very big clients, committing serious financial crimes. In this scenario the new practice builds more transparency also.
The online accounting practice also provide for more timely communication between the firm and clients. Since the client has more immediate access to information and to time sensitive documents with Online Accounting practices, questions and problems can be more easily identified and resolved. This translates into increased profits as well as happier clients!!
Since the clients get better service, they get more value for the money they spend. It is generally quite cheaper for the business owner to outsource the bookkeeping and accounting than to hire and supervise it in-house. Savings for the business owner can be as much as 30% for some clients! Online Accounting is great for such services.
The accounting firms also charge now a fee (fixed on a monthly basis) almost five times the average monthly fee (based on billable hours) they charged earlier.
Generally the various online accounting processes available are customized for their users where they can choose the menu of features they like.
Online Accounting is an excellent tool for accounting and book keeping, one that is help full for both the accounting firms as well as the clients.
As such accounting industry as been little slow to adopt the newer technology and has not left fully its love for the pen and pencil work.
The SU accounting industry has seen new trend of outsourcing its work now. All these have forced the industry to adopt the Online Accounting. The internets as well as other technologies are used now to build more efficient book keeping systems. Also it’s becoming more cost efficient for larger firms to outsource the work. Outsourcing is very much easier with work being delivered online. It’s much more cost effective as well as fast also.
The shift from the practice where clients paid the accounting firms as per the billable hours to a fixed fee based system is forcing the accounting firms to deliver efficient work in cost effective manner. This means that they can not any longer cover their inefficient work by merely putting in more time into the projects. This has favored the Online accounting practices much. Value billing has forced accounting professionals to become more efficient.
Online accounting very effectively cuts short the time taken to transfer the time taken by information exchange between the clients and accounting firm. The seamless transfer is far more efficient and much faster. The accounting firm has dynamic access to the sourcing documents of the clients firms and can access anytime any information it requires from its clients side. The online accounting system also allows the accounting firm access to client data from far away locations at the a few clicks on the internet. The time sensitive financial data is readily available to the accounting firm.
Other then the speed and cost of services, online accounting enables better customer service and more reliability and trust. Accounting firms recently have been exposed as in cahoots with some very big clients, committing serious financial crimes. In this scenario the new practice builds more transparency also.
The online accounting practice also provide for more timely communication between the firm and clients. Since the client has more immediate access to information and to time sensitive documents with Online Accounting practices, questions and problems can be more easily identified and resolved. This translates into increased profits as well as happier clients!!
Since the clients get better service, they get more value for the money they spend. It is generally quite cheaper for the business owner to outsource the bookkeeping and accounting than to hire and supervise it in-house. Savings for the business owner can be as much as 30% for some clients! Online Accounting is great for such services.
The accounting firms also charge now a fee (fixed on a monthly basis) almost five times the average monthly fee (based on billable hours) they charged earlier.
Generally the various online accounting processes available are customized for their users where they can choose the menu of features they like.
Online Accounting is an excellent tool for accounting and book keeping, one that is help full for both the accounting firms as well as the clients.
CPA Tax Outsource Is It Viable For Your Accounting Firm
Is your accounting firm buried up to the ears with tax return preparation work? The peak taxing season normally sees a huge rush by customers to their CPAs office to get their tax returns prepared and prepared right in time. Accounting firms have to deal with this heavy influx to meet growing demands and meeting customer deadlines. Yes, you do not want to spoil your firm’s impeccable image by not meeting your client demand and also by refusing to accept new clients. Just because you are overworked and overburdened does not mean that your firm will have to lose out on making profit during the tax season.
How about trying CPA tax outsourcing for your accounting firm and boosting your business prospects. No there is nothing to get worried about by just hearing the term CPA tax outsourcing. CPA tax outsourcing can only bring profit and benefits for your firm. By outsourcing you actually let a third party do the tiresome and time consuming work for your firm. The third party that will do the work for you is efficient in doing the job for you and also does the work at less than half the money that you will need for the same work if done by a CPA within your country.
Imagine the amount of money that you will be saving by using CPA Tax Outsourcing for your accounting firm. The money that you can save will spell profit for your business and imagine how high the margin of profit will be for your firm. Imagine the amount of workload you will be able to handle without hiring any new hands in your office. Everyone wants to have a prior knowledge about the amount they have to pay in taxes to the government and if you are able to deliver this to your clients on or before time then you are sure to attract more customers to your accounting firm.
Your accounting firm has to deal with many other things besides accounting, bookkeeping and calculating tax return preparations and CPA tax outsourcing is the best way for you to do this work. Once the CPAs in your firm are freed up from doing the time consuming work they can concentrate on other aspects for the development of your firm. The CPAs in your firm can concentrate on advising clients and working on other aspects to generate new business leads for your accounting firm.
Outsourcing is a great way for your business to progress. However you must take note of the fact that the outsourcing company whose service you hire must have an impeccable reputation. The efficiency of the outsourcing company depends on the kind of work that the company has successfully handled before. The very stake of your accounting firm depends on the type of work that is done by the outsourcing company. Find out the security features given by the company to safeguard your client’s financial and personal data.
CPA tax outsourcing has many benefits. One of the main benefits other than the fact that you can earn profit is that at anytime you feel that your work is not being done properly you can take it back the work from the company. There are plenty of opportunities available and you can choose many other companies to do the work for you. CPA tax outsourcing is beneficial for you in every aspect of your business.
How about trying CPA tax outsourcing for your accounting firm and boosting your business prospects. No there is nothing to get worried about by just hearing the term CPA tax outsourcing. CPA tax outsourcing can only bring profit and benefits for your firm. By outsourcing you actually let a third party do the tiresome and time consuming work for your firm. The third party that will do the work for you is efficient in doing the job for you and also does the work at less than half the money that you will need for the same work if done by a CPA within your country.
Imagine the amount of money that you will be saving by using CPA Tax Outsourcing for your accounting firm. The money that you can save will spell profit for your business and imagine how high the margin of profit will be for your firm. Imagine the amount of workload you will be able to handle without hiring any new hands in your office. Everyone wants to have a prior knowledge about the amount they have to pay in taxes to the government and if you are able to deliver this to your clients on or before time then you are sure to attract more customers to your accounting firm.
Your accounting firm has to deal with many other things besides accounting, bookkeeping and calculating tax return preparations and CPA tax outsourcing is the best way for you to do this work. Once the CPAs in your firm are freed up from doing the time consuming work they can concentrate on other aspects for the development of your firm. The CPAs in your firm can concentrate on advising clients and working on other aspects to generate new business leads for your accounting firm.
Outsourcing is a great way for your business to progress. However you must take note of the fact that the outsourcing company whose service you hire must have an impeccable reputation. The efficiency of the outsourcing company depends on the kind of work that the company has successfully handled before. The very stake of your accounting firm depends on the type of work that is done by the outsourcing company. Find out the security features given by the company to safeguard your client’s financial and personal data.
CPA tax outsourcing has many benefits. One of the main benefits other than the fact that you can earn profit is that at anytime you feel that your work is not being done properly you can take it back the work from the company. There are plenty of opportunities available and you can choose many other companies to do the work for you. CPA tax outsourcing is beneficial for you in every aspect of your business.
Corporate Accounting: Microsoft Dynamics GP or Microsoft Great Plains
The ideas of Corporate ERP/MRP/Accounting application was developed back in 1960th, however nowadays the topic is still actual and we are watching how dozens of new Accounting packages hit the market every year. This process sees some consolidation, to be admitted. In this small article we will be reviewing key parameters to take to the consideration while selecting corporate ERP and Microsoft Great Plains/Dynamics GP as budget option for large or mid-size corporation
• Database Platform. If you look back to 1990th – the competition between cheaper platforms, such as Microsoft SQL Server 6.5 was in the progress. However now Microsoft SQL Server 2000/2005 is solid rock product, which can support unlimited database size and data recording/retrieving pattern. In 1990th you would be thinking about Oracle, DB2, Sybase, etc. to select reliable database platform
• Computer Hardware. Well, the question of computer hardware is still actual, however we see more trust to Intel/AMD platforms, yes servers from Dell, HP, Compaq. Even Linux is coming to Intel/AMD servers world and the question of hardware competition should be probably deemphasized. The question on Unix/Linux/Windows competition is still on the place and we expect more harmony in the future
• Microsoft Dynamics ERP Selection. Here we see several products: Microsoft Great Plains/Dynamics GP, Microsoft Axapta/Dynamics AX, Microsoft Navision/Dynamics NAV. If you think about rich-functionality ERP – this is Microsoft Axapta. However in our opinion – corporation should consider budget solutions first – and this is where Microsoft Great Plains comes to the consideration
• Regional Consideration. If we are thinking about Microsoft Dynamics ERP products – Navision and Axapta should be considered as very good candidate for localized products for new and emerging markets: Brazil, LATAM (Latin America), China, India. Microsoft Dynamics GP/Great Plains is good candidate for English speaking countries and French Canada/Quebec/Montreal.
• Brazilian Localization specifics. In our opinion, if you are mid-size branch in Brazil, you should consider SAP Business One as a hub ERP application to be consolidated to your European (mySAP) or USA headquarters (Microsoft Dynamics GP)
• LATAM Consideration. Great Plains Software, later on purchased by Microsoft and renamed into Microsoft Great Plains Business Solutions, has very long and successful presence in Latin America
• Europa. Microsoft Dynamics GP 9.0 will be available in UK, however French, Belgium, German, Dutch versions will be translated in the second half of 2006. Version 9.0 of Microsoft Dynamics GP will be probably the last one available for non-English speaking countries in Europe
• eConnect. If we are diving into technical depth of Microsoft Great Plains – this is where you should be investing into your developers training and certification. Even Great Plains Integration Manager will be rewritten in eConnect technologies. Plus you should be aware about eConnect domination in Ecommerce area for Microsoft Dynamics GP
• Oracle Financials/E-Business Suite. I our opinion Oracle Applications should be competing freely with Microsoft and SAP ERP products. If you are large corporation – you should consider Oracle Financials and SAP R/3 as rich-functionality ERP prior to jumping to budget solutions such as Microsoft Dynamics GP, Microsoft Dynamics Nav, or SAP Business One.
• C#/VB.Net consideration. In our opinion – if you consider Microsoft Dynamics GP development – Microsoft Dexterity – with Dexterity Source Code programming option is the best choice, however Microsoft will expose more programming options to C# and Visual Basic developers through XML web services. This should be considered as replacement to VBA/GP modifier development
• Database Platform. If you look back to 1990th – the competition between cheaper platforms, such as Microsoft SQL Server 6.5 was in the progress. However now Microsoft SQL Server 2000/2005 is solid rock product, which can support unlimited database size and data recording/retrieving pattern. In 1990th you would be thinking about Oracle, DB2, Sybase, etc. to select reliable database platform
• Computer Hardware. Well, the question of computer hardware is still actual, however we see more trust to Intel/AMD platforms, yes servers from Dell, HP, Compaq. Even Linux is coming to Intel/AMD servers world and the question of hardware competition should be probably deemphasized. The question on Unix/Linux/Windows competition is still on the place and we expect more harmony in the future
• Microsoft Dynamics ERP Selection. Here we see several products: Microsoft Great Plains/Dynamics GP, Microsoft Axapta/Dynamics AX, Microsoft Navision/Dynamics NAV. If you think about rich-functionality ERP – this is Microsoft Axapta. However in our opinion – corporation should consider budget solutions first – and this is where Microsoft Great Plains comes to the consideration
• Regional Consideration. If we are thinking about Microsoft Dynamics ERP products – Navision and Axapta should be considered as very good candidate for localized products for new and emerging markets: Brazil, LATAM (Latin America), China, India. Microsoft Dynamics GP/Great Plains is good candidate for English speaking countries and French Canada/Quebec/Montreal.
• Brazilian Localization specifics. In our opinion, if you are mid-size branch in Brazil, you should consider SAP Business One as a hub ERP application to be consolidated to your European (mySAP) or USA headquarters (Microsoft Dynamics GP)
• LATAM Consideration. Great Plains Software, later on purchased by Microsoft and renamed into Microsoft Great Plains Business Solutions, has very long and successful presence in Latin America
• Europa. Microsoft Dynamics GP 9.0 will be available in UK, however French, Belgium, German, Dutch versions will be translated in the second half of 2006. Version 9.0 of Microsoft Dynamics GP will be probably the last one available for non-English speaking countries in Europe
• eConnect. If we are diving into technical depth of Microsoft Great Plains – this is where you should be investing into your developers training and certification. Even Great Plains Integration Manager will be rewritten in eConnect technologies. Plus you should be aware about eConnect domination in Ecommerce area for Microsoft Dynamics GP
• Oracle Financials/E-Business Suite. I our opinion Oracle Applications should be competing freely with Microsoft and SAP ERP products. If you are large corporation – you should consider Oracle Financials and SAP R/3 as rich-functionality ERP prior to jumping to budget solutions such as Microsoft Dynamics GP, Microsoft Dynamics Nav, or SAP Business One.
• C#/VB.Net consideration. In our opinion – if you consider Microsoft Dynamics GP development – Microsoft Dexterity – with Dexterity Source Code programming option is the best choice, however Microsoft will expose more programming options to C# and Visual Basic developers through XML web services. This should be considered as replacement to VBA/GP modifier development
Accounting Sucks
Want to become an Accountant? Yuck!
My reason to become an accountant was that I saw it as a way to get free education while getting paid.
When I got my undergraduate degree I figured that I could rest on my laurels and the world would beat a path to my door offering me fantastic jobs.
In actual fact the only job offers I got was as an insurance salesman on commission, as a salesman selling paper towels and as an articling student for one of the big eight accounting firms.
I snapped up the articling job.
What a grandiose mistake!
Fot the next 4 years I worked during the day, I worked overtime during tax preparation time, I went to school at night and studied every night for 4 years and went one month a year to summerschool.
During this one month you crammed in two more full accounting-related courses and wrote exams.
So over a period of 4 years you take 17 courses and then write something called the Uniform Final Examinations.Failure Rate over 50%.
So you pass. What now? At the time I was working as an auditor for the government. My work was extremely boring because the government was in the process of setting up a new state tax system taxing the actual value of companies.
However, I had my own personalized briefcase, a copy of the tax act , and a namestamp.
The job was sooo boring:
-You started at 9.30 AM and then counted the minutes to 10.30 AM which was coffee time. Coffee time took 20 minutes and woo anybody who took more than 20 minutes.
And then after Coffee you counted the minutes till lunch.
Because it was a government job you could calculate when and how much your next raise was going to be.
You could also calculate how much your pension was going to be. So most of our time was spent calculating how much we would be making
5 years from now and how much our pensions would be.
I quit after exactly one year because of the boredom.
The Director was so peed off because of my disloyalty in quitting him that after I told him he immediately barged into my cubicle and demanded I handed over my personalized briefcase and my signature stamp as well as the tax act.
I bought a small existing practice from a Jewish accountant who had become a millionaire selling land as a hobby and did not need his accounting practice any more.
So here I was,in my own practice, the token gentile surrounded by Jewish accountants having almost nothing but Jewish clients.
Well, I learned accounting in a hurry!
I never learned real accounting going to school, just theories, laws and statistical methods.
However, when somebody brings in a greasy paper bag with receipts and says:" can you do my returns for the last 4 years?
I am missing about 8 months worth of receipts." you learn accounting in a hurry.
Another client(a Cropduster) comes in and says: "I just split up with my wife and she is going to tell the tax department that I have not filed a return for the last 7 years. Can you do them before next Tuesday? I have no receipts."
Anyway, counting other people's money gets discouraging after a while.
I quit accounting and started pursuing other interests.
On the whole accounting for me has been a waste of time.
My reason to become an accountant was that I saw it as a way to get free education while getting paid.
When I got my undergraduate degree I figured that I could rest on my laurels and the world would beat a path to my door offering me fantastic jobs.
In actual fact the only job offers I got was as an insurance salesman on commission, as a salesman selling paper towels and as an articling student for one of the big eight accounting firms.
I snapped up the articling job.
What a grandiose mistake!
Fot the next 4 years I worked during the day, I worked overtime during tax preparation time, I went to school at night and studied every night for 4 years and went one month a year to summerschool.
During this one month you crammed in two more full accounting-related courses and wrote exams.
So over a period of 4 years you take 17 courses and then write something called the Uniform Final Examinations.Failure Rate over 50%.
So you pass. What now? At the time I was working as an auditor for the government. My work was extremely boring because the government was in the process of setting up a new state tax system taxing the actual value of companies.
However, I had my own personalized briefcase, a copy of the tax act , and a namestamp.
The job was sooo boring:
-You started at 9.30 AM and then counted the minutes to 10.30 AM which was coffee time. Coffee time took 20 minutes and woo anybody who took more than 20 minutes.
And then after Coffee you counted the minutes till lunch.
Because it was a government job you could calculate when and how much your next raise was going to be.
You could also calculate how much your pension was going to be. So most of our time was spent calculating how much we would be making
5 years from now and how much our pensions would be.
I quit after exactly one year because of the boredom.
The Director was so peed off because of my disloyalty in quitting him that after I told him he immediately barged into my cubicle and demanded I handed over my personalized briefcase and my signature stamp as well as the tax act.
I bought a small existing practice from a Jewish accountant who had become a millionaire selling land as a hobby and did not need his accounting practice any more.
So here I was,in my own practice, the token gentile surrounded by Jewish accountants having almost nothing but Jewish clients.
Well, I learned accounting in a hurry!
I never learned real accounting going to school, just theories, laws and statistical methods.
However, when somebody brings in a greasy paper bag with receipts and says:" can you do my returns for the last 4 years?
I am missing about 8 months worth of receipts." you learn accounting in a hurry.
Another client(a Cropduster) comes in and says: "I just split up with my wife and she is going to tell the tax department that I have not filed a return for the last 7 years. Can you do them before next Tuesday? I have no receipts."
Anyway, counting other people's money gets discouraging after a while.
I quit accounting and started pursuing other interests.
On the whole accounting for me has been a waste of time.
Current Hiring Trends For Accounting & Financial Professionals
Current Hiring Trends For Accounting & Financial Professionals by Tali Nizic, Controllers on Call This article first appeared in the June 2002 edition of The Bottom Line, The Independent Voice for Canada's Accounting and Financial Professionals
Today's business environment and the current economy are such that many organizations are continuously looking at cost-cutting measures, ensuring that the organization is operating at peak state, is attuned to the rapid changes of high tech as well as on-going development of long-term business solutions and strategies.
All of these tasks, not to mention the daily routines of the operations alone, create an ongoing demand for full-time and contract accounting and finance professionals to support and implement these initiatives.
Accounting and finance professionals are needed to provide guidance to middle and senior management, enhance operational efficiency and analyze financial data. Companies - large or small - are seeking accounting and finance professionals with diverse skill set to efficiently and quickly "role up their sleeves", assume various roles and act as the liaison between senior management and staff.
To achieve these tasks successfully, accounting and finance professionals are required to establish rapport and work in partnership with various key staff in the organization.
Hence, organizations are hiring accountants with solid interpersonal skills - those who are able to "think out of the box", and those who bring along innovative ideas and will be active participants in new initiatives, as the organization's needs to change.
With our current economy slowing down in the past few months, we are now in what is called the "employer's market" cycle.
Some of the primary factors are: 9/11; the end of the dot-com "hysteria"; massive layoffs in companies like Nortel, Air Canada, Ford Motor Company and Lucent Technologies; and the volatile stock market.
Among the greatest challenges companies face today, is finding qualified competent professionals with that seemingly elusive "chemistry fit" between management and staff, one of the most important keys to effective, efficient, productive and happy work environments.
In an employer's market, there is higher supply and lower demand of qualifies resources. With this advantage employers are able to be more selective when hiring and will take their time to ascertain which candidate possesses the best "chemistry fit" for the corporate culture.
We find organizations today seek finance professionals committed to the position hired for as well as to the accounting profession as a whole.
As a result, fully designated candidates, or those who are working toward completing their designation are in higher demand.
These include: Chartered Accountants (CA), Certified General Accountants (CGA) or Certified Management Accountants (CMA) and those who have earned the Fellow Credit Institute (FCI) designations.
To be successful in our current competitive economy, it is imperative for organizations to implement all cost effective measures, be creative and innovative.
Human resources happen to be the number one major fixed cost. What are organizations doing today to make this fixed cost more practical, efficient and effective?
One solution is complementing the existing permanent staff with qualified contract/project professionals.
Contract employees offer organizations a tremendous cost-effective benefit by utilizing their highly specialized experience needed to complete any current initiatives as well as assisting with the implementations of proposed strategic and long-range plans.
Contract/project employees are ideal for special projects - year end work, work surges, system conversions, budgeting and strategic planning, maternity or sick leaves, and bridging the gap while searching for full-time staff.
In situations where the position is vacant, what a better way to observe and evaluate the contract employee for permanent consideration and vise versa!
Our experience as a recruiting firm indicates that the use of contract/project professionals is expected to increase during the next few years.
Converting a fixed human resources expense into a variable expense offers a stronger foothold in the market place for companies looking to gain a competitive edge.
Compensation levels in 2002 have stabilized compared to 2001. According to industry surveys, the average starting remuneration for accounting and finance professionals is expected to increase by about 3 per cent.
Here are some samples of accounting and finance salary ranges, pending on the company's size and gross annual sales:
CFO $90K - $240K VP, Finance $80K - $200K Controller $65K - $160K Assistant Controller $55K - $110K Accounting Manager $45K - $ 80K Financial Analyst $40K - $ 90K
In conclusion, for business in today's environment to grow and prosper, the accounting and finance professionals they employ must possess solid technical and communication skills, adaptability as well an outstanding capability to build and develop business relationships with internal an external stakeholders.
Organizations are encouraged to be careful with full-time hiring decisions and building a flexible work force through a carefully selected blend of full-time and contract employees.
For the accounting and finance professional to be successful they must possess solid interpersonal skills and diverse industry experience with progressive companies, adapt to technological advances and the ability to manage a broad range of accounting and managerial responsibilities.
Be fully designated or at the very least, enrolled in a recognized accounting program. Knowing that "job security" is a term of the past be open and flexible to a wide range of employment opportunities, be it contract, temporary to permanent or full time situations.
Today's business environment and the current economy are such that many organizations are continuously looking at cost-cutting measures, ensuring that the organization is operating at peak state, is attuned to the rapid changes of high tech as well as on-going development of long-term business solutions and strategies.
All of these tasks, not to mention the daily routines of the operations alone, create an ongoing demand for full-time and contract accounting and finance professionals to support and implement these initiatives.
Accounting and finance professionals are needed to provide guidance to middle and senior management, enhance operational efficiency and analyze financial data. Companies - large or small - are seeking accounting and finance professionals with diverse skill set to efficiently and quickly "role up their sleeves", assume various roles and act as the liaison between senior management and staff.
To achieve these tasks successfully, accounting and finance professionals are required to establish rapport and work in partnership with various key staff in the organization.
Hence, organizations are hiring accountants with solid interpersonal skills - those who are able to "think out of the box", and those who bring along innovative ideas and will be active participants in new initiatives, as the organization's needs to change.
With our current economy slowing down in the past few months, we are now in what is called the "employer's market" cycle.
Some of the primary factors are: 9/11; the end of the dot-com "hysteria"; massive layoffs in companies like Nortel, Air Canada, Ford Motor Company and Lucent Technologies; and the volatile stock market.
Among the greatest challenges companies face today, is finding qualified competent professionals with that seemingly elusive "chemistry fit" between management and staff, one of the most important keys to effective, efficient, productive and happy work environments.
In an employer's market, there is higher supply and lower demand of qualifies resources. With this advantage employers are able to be more selective when hiring and will take their time to ascertain which candidate possesses the best "chemistry fit" for the corporate culture.
We find organizations today seek finance professionals committed to the position hired for as well as to the accounting profession as a whole.
As a result, fully designated candidates, or those who are working toward completing their designation are in higher demand.
These include: Chartered Accountants (CA), Certified General Accountants (CGA) or Certified Management Accountants (CMA) and those who have earned the Fellow Credit Institute (FCI) designations.
To be successful in our current competitive economy, it is imperative for organizations to implement all cost effective measures, be creative and innovative.
Human resources happen to be the number one major fixed cost. What are organizations doing today to make this fixed cost more practical, efficient and effective?
One solution is complementing the existing permanent staff with qualified contract/project professionals.
Contract employees offer organizations a tremendous cost-effective benefit by utilizing their highly specialized experience needed to complete any current initiatives as well as assisting with the implementations of proposed strategic and long-range plans.
Contract/project employees are ideal for special projects - year end work, work surges, system conversions, budgeting and strategic planning, maternity or sick leaves, and bridging the gap while searching for full-time staff.
In situations where the position is vacant, what a better way to observe and evaluate the contract employee for permanent consideration and vise versa!
Our experience as a recruiting firm indicates that the use of contract/project professionals is expected to increase during the next few years.
Converting a fixed human resources expense into a variable expense offers a stronger foothold in the market place for companies looking to gain a competitive edge.
Compensation levels in 2002 have stabilized compared to 2001. According to industry surveys, the average starting remuneration for accounting and finance professionals is expected to increase by about 3 per cent.
Here are some samples of accounting and finance salary ranges, pending on the company's size and gross annual sales:
CFO $90K - $240K VP, Finance $80K - $200K Controller $65K - $160K Assistant Controller $55K - $110K Accounting Manager $45K - $ 80K Financial Analyst $40K - $ 90K
In conclusion, for business in today's environment to grow and prosper, the accounting and finance professionals they employ must possess solid technical and communication skills, adaptability as well an outstanding capability to build and develop business relationships with internal an external stakeholders.
Organizations are encouraged to be careful with full-time hiring decisions and building a flexible work force through a carefully selected blend of full-time and contract employees.
For the accounting and finance professional to be successful they must possess solid interpersonal skills and diverse industry experience with progressive companies, adapt to technological advances and the ability to manage a broad range of accounting and managerial responsibilities.
Be fully designated or at the very least, enrolled in a recognized accounting program. Knowing that "job security" is a term of the past be open and flexible to a wide range of employment opportunities, be it contract, temporary to permanent or full time situations.
The Difference Between Accrual and Cash Accounting
Small business owners are often asked by bankers, investors, and other interested parties about which method of accounting they are using to produce their company’s financial statements. The person reviewing your financial data needs to know this so they can accurately review the numbers presented them. Both the accrual and cash methods are accepted ways of recording transactions, but each method sometimes gives very different results in your bottom line profit.
The cash method of accounting is the most commonly used method. It is the easiest way to record transactions and can normally be done by the business owner and not an accountant. Simply put, the cash method records money when it comes in, and money when it goes out. It is basically a mirror image of your business account check register. For example, when a customer pays you money for goods and services, you then record the sale in your books. When you write a check or pay cash for an expense that is the moment in time when you enter the expense in your books. It’s as simple as that. Most all small businesses can use the cash method of accounting if they wish, unless they carry inventory and average over ten million dollars in gross sales in the three prior years of business. If your business falls into this category, you must use the accrual method of accounting.
The accrual method of accounting is the “correct” way to compile your financial statements. If you hire a CPA to compile your financial statements, they will produce your financial statements in accordance with “GAAP” (Generally Accepted Accounting Principles). This simply means that they will use the accrual method of accounting. What does accrual mean? The timing of your business revenue and expenses are better matched with this method. You record the sale of goods and services when they are invoiced or the job is complete. It does not matter if you have collected the money yet or not. Expenses are also recorded in the company books when they are “incurred” or due and payable. They are not necessarily recorded when they are paid. This type of accounting will give you a better picture of how your business is actually performing and should be used when analyzing your business profits.
Neither method of accounting is wrong or right. It is up to the business owner or his accountant to determine which method will be used.
The cash method of accounting is the most commonly used method. It is the easiest way to record transactions and can normally be done by the business owner and not an accountant. Simply put, the cash method records money when it comes in, and money when it goes out. It is basically a mirror image of your business account check register. For example, when a customer pays you money for goods and services, you then record the sale in your books. When you write a check or pay cash for an expense that is the moment in time when you enter the expense in your books. It’s as simple as that. Most all small businesses can use the cash method of accounting if they wish, unless they carry inventory and average over ten million dollars in gross sales in the three prior years of business. If your business falls into this category, you must use the accrual method of accounting.
The accrual method of accounting is the “correct” way to compile your financial statements. If you hire a CPA to compile your financial statements, they will produce your financial statements in accordance with “GAAP” (Generally Accepted Accounting Principles). This simply means that they will use the accrual method of accounting. What does accrual mean? The timing of your business revenue and expenses are better matched with this method. You record the sale of goods and services when they are invoiced or the job is complete. It does not matter if you have collected the money yet or not. Expenses are also recorded in the company books when they are “incurred” or due and payable. They are not necessarily recorded when they are paid. This type of accounting will give you a better picture of how your business is actually performing and should be used when analyzing your business profits.
Neither method of accounting is wrong or right. It is up to the business owner or his accountant to determine which method will be used.
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