Business Planning

, , ,

Use financial ratios to review your Company's results

, , ,

Financial ratios can be helpful tools in understanding your company’s financial health. They are a benchmark by which you can compare your business to industry standards and analyze changes over time.

In fact, benchmarking and comparing to your competition is so important to business success that I provide all my business clients with an annual report on the benchmarks and results for their particular industry or profession. Without this it can be like traveling back roads without a map.

One warning though. If you begin comparing your results and calculating your ratios with incorrect accounting information from your business you just may wind up making the wrong decisions. All of the financial review and performance measurement we can discuss is of no use if your business's basic

, , , ,

Making the Most of Your Aircraft Deductions

, , , ,

More than ever, the media, IRS and the Securities and Exchange Commission have expressed their disapproval of private aircraft use by businesses. They each hold a general perception that personal use of business aircraft is extravagant and difficult to justify. But, your purchase, lease, or charter of an aircraft by you or the corporation you own (remember if you’re married, “you” includes your spouse as well) can still create open the opportunity for significant tax benefits.

As you might imagine, the IRS does not take as kind of a view of the tax benefits of aircraft ownership as you or I might. The American Jobs Creation Act of 2004 reversed the favorable aircraft deduction strategies previously available to you as identified in a key Tax Court case (Sutherland Lumber-Southwest, Inc. v Commissioner).

An IRS notice now restricts certain aircraft deductions, requires specific treatment of business owners, and requires stricter, more detailed records of aircraft use. Even with these restrictions though, you can still increase your financial wellbeing by making the aircraft rules work for you.

,

Our experience with "cloud computing"... Wonderful!

,

I suppose I should first ask if you even know what the term "cloud computing" means. According to Wikipedia, cloud computing is Internet-based development and use of computer technology.  Essentially, this means that rather than installing some type of hardware or software in your own business computers you just use the Internet to access the tools you need via the Internet.

In our case here at Scholl, Chyo & Company, CPAs we recently finished migrating our email, calendar, scheduling, tasks, etc. from our Microsoft Exchange Servers to Google's Apps Premier Edition. I can now say that we're thrilled with the results. We've been able to eliminate the cost of maintaining several expensive servers and saving David, our internal IT guru a ton of time and aggravation. At $50 per employee per year its cost is less than the annual Microsoft Exchange updates alone.

, , ,

Time IS Money So Get The Best Return On Your Investment

, , ,

Have you ever reached the end of the day and wondered where all your time went? Playing catch-up to retrieve wasted time is what keeps many business owners welded to their business premises way outside of ‘normal’ business hours.

For many business owners a number of their customers, suppliers and employees are likely to be friends as well as business acquaintances. This overlap of private and business relationship can lead to requests for assistance or for special deals that can make serious inroads on their time. A lot of small business operators go slowly broke doing work for friends at discounted rates or for free. ‘Discounted rates’ translates as ‘at less than your market value’ and that means more hours you have to put in to make up for the lost profit.

, ,

12 Days for a Start-Up Business

, ,

The holiday season is around the corner and while recovery from the global financial crisis is, well, not exactly in full swing… I thought it was time to address the vital question of what it takes to start a new business. Much like the larger-than-life gift-wielding icon from the North Pole, many people question whether or not starting a new business on the back end of recession is a good idea … or the figment of over-active entrepreneurial spirit?

Well in some ways it’s a better time and easier than it ever has been. The competition has been winnowed out, and many businesses are quieter and less obtrusive in their marketing. New technology options including the Internet, e-marketing and outsourced suppliers offering SaaS (software as a service or "cloud computing") make it possible for you to do a lot without emptying your bank.

, ,

Avoid Budget Blowouts

, ,

A budget is an important management tool. Being a projection of your income against your expenses you can check it at any time to see how well or how poorly your business is doing. The value of a budget is in direct proportion to the accuracy of the figures you use to create it. Here are some precautions to take to keep your budget figures accurate.

Use Realistic Projections

Since a budget is based on projections there’s always an element of uncertainty involved in estimating inputs. It pays to be conservative regarding things such as sales forecasts. If they turn out to be better than estimated, that’s great and provides the opportunity to distribute the extra around to advantage.