Guide To Increase Your Consulting Income Heavily

Here are just a few ways to increase and diversify your
income from your consulting business.


1. Sell More Services to Your Existing Clients


Instead of spending all that time and money trying to get
new business, why not try to sell more services to your
existing client base?

If you are an accounting and tax consulting firm, for
example, you likely have clients who need some assistance
in their record keeping and documentation. In addition to
your year-end tax services, could you provide monthly
bookkeeping and financial statements, accounting system
setups, training in accounting software, or other services
to assist your client?

Monthly services, in addition to annually billed fees, will
help you smooth out your cashflow and minimize the seasonal
nature of your business.


2. Mass Market Your Advice by Productizing Your Services


Could you produce a folio, special report, newsletter,
e-book, book, audio cassette, video, or course? If so, you
could enjoy making money even when you're not billing for
your time. While asleep or on vacation, the sale of your
information products could be generating additional income
for you.

Sell such products through direct mail, mail order,
exporting, and Internet marketing (your own website,
your own affiliate programs, eBay auctions, and so on).

As well as the passive, residual income that information
products can produce for you, they also help establish your
credentials as an expert. This, in turn, produces more
consulting opportunities for you.


3. Perform Group Consulting


Seminars, workshops, and teleclasses enable you to help
many participants in a cost-effective manner. In addition
to paying for admission, your attendees may also purchase
some of your information products or even become your
regular consulting clients.


4. Consider Additional Markets


Could you sell your consulting services to federal, state,
provincial, or municipal governments? Could you be an
expert trial witness?

If you consult with local clients, could you extend your
reach nationally or internationally by using the telephone
and Internet?


These few ideas are a starting point for you to brainstorm
all the possibilities for exploding your consulting income.



About the author:
RESOURCE BOX:


J. Stephen Pope, President of Pope Consulting Inc.,
has been helping clients to earn maximum business profits
for over twenty-five years.

For more information about profitable consulting and other
Work at Home Small Business Ideas, visit:
http://www.yenommarketinginc.com/consulting.html

Business Accounting

When you are looking for high-class advice concerning accountancy, it will be hard sorting out the best information from foolish accountancy proposals and guidance so it's best to know ways of moderating the information offered to you.

NetSuite: Small Business Accounting
NetSuite offers an integrated online accounting application with ecommerce, sales, inventory, shipping and support. Free Trial.



Now we would like to offer you some advice which we advise you to use when you are searching for information about accountancy. You need to realize the guidance we put forward is only pertinent to internet based information concerning accountancy. We don't really offer any direction or assistance when you are also conducting research in books or magazines.

OpenPro: Web Based Accounting
Offers Web-based, open source ERP accounting system with financials, supply chain, manufacturing, CRM and ecommerce features.



An interesting tip to pursue when you're presented with information and suggestions on a accountancy website would be to determine who owns the site. Doing this could reveal the owners accountancy credibility The easiest way to reveal who owns the accountancy web site is to find the sites 'about' page.

Any reputable site providing information concerning accountancy, will always have contact information which will record the site owner's contact details. The details should make known some key points concerning the owner's requisite knowledge. You can then arrive at a decision about the webmaster's depth of experience, to offer guidance about accountancy.



About the author:
Tom Brown is the webmaster for http://www.hession-acton.info

Top Guide for Writing Accounting Procedures

Laying the Foundation

Last week, we raised the question: what would your business do with $1,000,000? To lay the foundation we introduced inventory as the first of four areas that will lead toward our million dollar goal. And you saw exactly how to achieve the first $250,000 in cash savings by avoiding delays with an increase in velocity, as well as an increase in discipline and competency. But how exactly? With time – as you saw with inventory and as you’ll see this week.

Tackling Accounting Procedures

Let’s continue that crucial theme of time with another major source on your balance sheet – specifically, accounts receivable (A/R). If you have $500,000 or more in accounts receivable then STOP! We have found it again.

Reducing Average Days Collection

Why? Because if we focus on reducing your average days collection by 50%, then your accounts receivable balance will fall to $250,000 and the result will be an extra $250,000 in your bank account. And just like that, we’re halfway to our $1,000,000 goal.

So now, let’s see how this actually works in a real-life business scenario.

Accounting Procedures Service Business Example

A service organization with $700,000 in average A/R balances needed assistance. So we examined their A/R function to understand and quantify the workflow and workload issues. Then we designed and implemented a process to improve the A/R performance.

The metrics we developed reduced their “over 60” accounts receivables by 85% and their overall A/R balance by 50% within 90 days of implementing the new procedures. With these new processes and reports, the company now tracks Average Days Collection and past due rather than just Days Sales Outstanding (DSO) as the measure of their collection effectiveness.

The result: an extra $350,000 in cash. And, again, we explicitly see the crucial role of time and how an increase in velocity and discipline directly yields an increase in efficiency and cash savings. So how can you use time to your advantage?

Methods to Design the New Accounting Process

Decrease collection cycle. Examine customer accounts that go beyond your terms. Do not wait until twice the net terms to take action.

Tighten credit policy. Examine credit process for slippage. Do you have a credit approval process? Do you perform credit checks? What standards are used to extend credit?

Reduce credit terms. Change the credit terms you offer your customers. If you offer terms of net 45, reduce it to net 30. You might offer a discount of 1% if paid within 10 days else net due in 30 days. This is equivalent to 18 % annual interest and most businesses will take those terms.

Shorten the invoice process. Bill your customers immediately. This is a big one. Many service organizations wait until the end of the month to tally billable hours and determine customer charges. Do not wait until the end of the month. This could reduce your day’s receivable by as much as 15 days right there. Email or fax your invoices to save another day or two (e.g. QuickBooks accounting software contains this feature).

Reduce billing errors. Most customers delay payments because of invoice errors. Customers won’t recognize the invoice until it is corrected and may not even notify you, the vendor, of the error until you call for collection. Again, avoiding this delay in error and time will amount to cash savings.

Train Accounts Receivables personnel. Make sure that all personnel involved are training to understand the performance metrics for their jobs. For example, a company will manage $500,000 in monthly A/R balances (that’s $6 Million a year!) using an A/R clerk who makes $30,000. But then the supervisor uses nothing more than On-The-Job (OJT) training for the clerk. Then the CFO thinks that he or she (the CFO) is really managing the money. But, in reality, that’s not the case; the clerk is managing the money day-to-day. So shouldn’t the A/R clerk receive enough training to manage such a significant amount? After all, it only takes a 6% change in A/R in one month to equal the A/R clerk’s entire annual salary. Isn’t the A/R savings worth a little extra time in training?

Maximize the Accounting Process. With the Accounts Receivable department you should use each element of the process to gain the most benefit for your business. And with time-saving procedures set in place, you will let your efficiency work for you.

Grabbing Your Policy Goal

With well-defined processes and procedures in place, you will increase efficiency by reducing your Average Days Collection. And of course a reduction in Average Days Collection means your Accounts Receivable balance will also fall, creating more cash in cash on hand. And just like that we’re halfway to our $1,000,000 goal. All you have to do is grab it.

Next week, we will look at finding still another $250,000 in the Sales function – which will give us $750,000 toward our goal of 1 Million in cash savings. So, again, not only do you aim to reap the rewards of extra savings to your bottom line, but also see more cash in the bank - $1,000,000 cash to be exact.


About the author:
Chris Anderson is currently the managing director of Bizmanualz, Inc. and co-author of policies and procedures manuals, producing the layout, process design and implementation to increase performance.
To learn how to increase your business performance, visit: http://www.bizmanualz.com?src=ART79

Easy Guide for Understanding Depreciation

Depreciation is defined as a portion of the cost that reflects the use of a fixed asset during an accounting period. A fixed asset is an item that has a useful life of over one year. An accounting period is usually a month, quarter, six months or one year. Let’s say you bought a desk for your office on January 1, for $1000 and it was determined that the desk had a useful life of seven years. Using a one year accounting period and the “straight-line” method of depreciation, the portion of the cost to be depreciated would be one-seventh of $1000, or $142.86.

Most non-accountants roll their eyes and shudder when the topic of “depreciation” comes up. This is where the line in the sand is drawn. Depreciation is far too complicated to try and figure out, or so it seems to many. But is it really? Surely the definition of depreciation mentioned above is not that difficult to comprehend. If you look closely you will see that there are five pieces of information you must have in order to determine the amount of depreciation you can deduct in one year. They are:

-The nature of the item purchased (the desk).

-The date the item was placed in service (Jan 1).

-The cost of the item ($1000).

-The useful life of the item (seven years).

-The method of depreciation to be used (straight-line)

The first three are easy to figure out, the second two are also easy but require a little research. How do you figure out the useful life of an item? Let me regress for a moment. There is “book depreciation” which is based on the real useful life of an item, and there is the IRS version of what constitutes the useful life of an item. A business that is concerned with accurately allocating its costs so that it can get a true picture of net profit will use book depreciation on its financial statements.

However, for tax purposes the business is required to use the IRS method. The IRS may have shorter or longer useful lives for fixed assets causing a higher or lower depreciation write-off. The higher the write-off, the less tax a business pays. The long and short of it is that you end up having to create a book financial statement and a tax financial statement. So, most small businesses that aren’t concerned with a precise measurement of their net profit use the IRS method on their books. This means that all you have to do is look in IRS Publication 946 to find the useful life of a particular item.

The last piece of information you need is found by determining the method of depreciation to use. Most often it will be one of two methods: the “straight-line” method or an accelerated method called the “double-declining balance” method. Let’s briefly discuss these two methods:

Straight-line

This is the simple method mentioned in the definition above. Just take the cost of the item, divide it by the useful life and you’ve got the answer. Yes, you will have to adjust the depreciation for the first year you placed the item in service and for the last year when you removed the item from service. For instance, if your depreciation for one year was $150 and you placed the item in service on April 1 then divide $150 by 12 (months) and multiply $12.50 by 9 (months) to get $112.50. If you removed the item on February 28 then your deduction will only be $25.00 (2 x $12.50).

Double-declining balance

The idea behind this method is that when an item is purchased new, you will use up more of it in the earlier years of its life, therefore, justifying a higher depreciation deduction in the earlier years. With this method, simply divide the cost of the item by the useful life years as in the straight-line method. Then, multiply that result by 2 (double) in the first year. The second year, take the cost of the item and subtract the accumulated depreciation. Next, divide that result by the useful life and multiply that result by 2, and so on for each remaining year.

But, wait! You don’t have to do this. The IRS provides tables that have the percentages worked out for each year of the two different methods. Not only that, they have set up special first year “conventions” that assume you purchased your depreciable fixed assets on June 30. This is called the one-half year convention. The idea behind this is that you may have bought some items earlier than June 30 and some after that date. So, to make it easy to figure out, they assume the higher and lower depreciation amounts will all average out.

Actually, the IRS doesn’t even call it depreciation anymore. They call it “cost recovery”. Let’s face it. This is a political tool. Congress giveth and taketh away. They have been playing with this system for years. If they want to stimulate growth in business they will shorten the useful life of assets so businesses can attain a higher write-off. If they are not in the mood, they will extend the useful life of an item. A good example is the 39 years set for the useful life of commercial property. This means that if you lease a building for your business and make improvements, those improvements have to be depreciated over 39 years. Now congress is working on a bill to drop that down to 15 years for leasehold improvements.

Before December 31, 1986 we had ACRS or Accelerated Cost Recovery System. Currently, we have MACRS or Modified Accelerated Cost Recovery System. Every time congress tweaks the rules they give it a different name.

Keep in mind there are different schedules for different properties. For instance, residential real property is depreciated over twenty-seven and one-half years and non-residential real property is depreciated over thirty-nine years. In addition, if more than forty percent of your total fixed asset purchases occurred in the last quarter of the year, then, you must use a mid-quarter convention. This convention assumes that your purchases made in the last quarter of the year were made on November 15. This prevents you from buying a big expensive piece of equipment on December 31 and treating it as though it were purchased on June 30 and gaining a larger depreciation expense.

Understanding how basic depreciation works can be valuable to the small business owner because it helps to know the tax implications when planning for capital equipment purchases.

About the author:
John W. Day, MBA is the author of two courses in accounting basics for non-accountants. Visit his website at http://www.reallifeaccounting.comto download for FREE his 3 e-books pertaining to small business accounting and his monthly newsletter on accounting issues. Ask John questions directly on his Accounting for Non-Accountants blog .

Strategies for Writing Accounts Payable Procedures

The cash cycle is undoubtedly the single most important process to optimize for any business – from when you spend money to when you get money.

Circling the Cash to Cash Cycle

So let’s tie this back to accounts payable - the event that pays for the liability incurred by purchasing, which is for inventory required by manufacturing to meet demand. Sales generate this demand that creates the accounts receivables, which is turned into cash. And now we have come full circle and completed the discussion on the cash to cash cycle.

Increasing the Velocity of Accounts Payable Processes

Your accounts payable is a bit different than the other processes we have examined so far. The first three processes we looked at represented processes where the focus was on reducing the size of assets (inventory or accounts receivable) or expenses (marketing) and increasing the velocity or cycle time. But in accounts payable our focus is on increasing the size of the asset, while maintaining a solid credit rating - and increasing the velocity of the process.

Now let’s look at how to find $250,000 in accounts payable savings. If your organization has $500,000 in accounts payable each month, then STOP! We can find $250,000 in savings right here. Where, you ask? Increasing payables by 25% will produce $125,000 in cash plus $125,000 from automating tasks, taking more discounts, and managing the process better.

Service Business Procedures Case Study

An organization with $600,000 in monthly payables needed assistance. We examined their payables process to understand and quantify workflow, paper processing and credit issues. Then we designed and implemented a process to increase their use of payables and discounts, improve their payables cycle efficiency, and tie it to their purchasing and receivable cycles. We then reinvested $50,000 back into an Enterprise Resource Planning (ERP) program to automate some of the processes that weren’t automated already.

The metrics we developed reduced their purchasing & payables expenses by 25% and increased their efficiency from 50% to 75% within 2 months of implementing the new procedures. With these new processes and reports, the company now tracks payables cycle efficiency and average days payables, rather than just bills paid on time or outstanding balance, as the measure of their payables effectiveness. The result: an extra $300,000 in cash plus a 50% increase in process capability (capacity).

But how?

Methods to Design Your News Accounts Payable and Accounting Procedures

• Eliminate Paper. The single biggest cost for any purchasing and payables department is paper, including: purchase orders, purchase order follow-up, small-dollar purchases, delivery tracking & receipts, and vendor payments. Utilizing paperless invoices, Web-based supplier self-servicing, centralized vendor files, automated workflows for electronic or imaged invoices (see ERP below), and payment methods, such as business credit cards, Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT), can reduce paper handling costs by as much as 90%.

• Integrate ERP Systems. Enterprise Resource Planning (ERP) automates the purchasing and payables functions, which allows a company to get more work done with fewer personnel. Also, electronic invoice matching applications save time in retrieving paperwork. It is estimated that an ERP system can annually save an organization $300 per million in sales.

• Increase Payment Terms. Negotiate payment terms based on receipt of goods or the invoice. This can add one week or more to your terms, which can be 25% of 30 day terms. Use EFT for just-in-time payments to maximize your payables terms and minimizing the impact to your credit.

• Take Payment Discounts. If you are getting 2%/10 net 30 terms, then consider taking it. This means you are offered a 2% discount if you pay within 10 days, instead of the normal 30 day terms. This translates into an 18% return on your capital, and for many organizations this is a good return on your investment.

• Review Purchases. Purchasing is a continuous process that requires continuous review. Consider: transportation charges, expedited fees, odd lot penalties, new pricing, new products, consolidating vendors, new vendors or buying groups, payment terms, and more. Communicate with your suppliers to improve the process. And review and monitor everything to account for changes in your environment.

• Communicate with Suppliers. Communicate with your suppliers to improve the process. Ask suppliers to submit their invoices electronically. This will save you time, resources and losses due to waste.

• Eliminate Disputes. Disputes with your suppliers are typically the result of a problem with your purchasing/receiving process. When disputes occur, review your purchasing procedures to ensure that they are producing the correct metrics and that you are not forced to pay for your mistakes.

• Reduce Errors. Overpayments, payments made to the wrong vendors, fake invoices, or even late payments represent a common problem for payables. Increasing your focus on error control, along with written procedures and audits, can reduce these errors considerably.

• Train personnel. Provide your accounts payable staff with regular formal training. This will arm them with better knowledge of frauds, negotiating skills, and an understanding of the economics of payables – which will result in improved effectiveness.

Accounting Policies and Procedures for Cash in the Bank

In the past few weeks, we have showed you four parts of your financial statements that will each contribute $250,000 in cash savings. The last hurdle was Accounts Payable, and we sailed through it. And now we have crossed our final goal: $1,000,000!

Time was - and is - the key. All you have to do is own it. And, remember, next week we will put together each of the four elements of the cash to cash cycle, and look at how it affects the working capital of your business.



About the author:
Chris Anderson is currently the managing director of Bizmanualz, Inc. and co-author of policies and procedures manuals, producing the layout, process design and implementation to increase performance.

To learn how to increase your business performance, visit: http://www.bizmanualz.com?src=ART81

7 Things to Consider Before Buying Small Business Accounting Software

The world of small business accounting software can be a minefield for any business owner. However choosing the right package is one of the most critical business decisions you will make.

Here are the seven things you must consider before making a purchase that will help you achieve your businesses goals.

1. Scalability

Businesses change over time so it's critical that the small business accounting software you choose can change too. Some things that often change are the number of products and services offered and the number of employees. When you choose your package try and imaging the business in 5 years or 10 years time and how different it will be. Use this information to guide your purchase decision. It may well be better to pay a little more now for the software knowing that it can be easily
upgraded when needed with minimum disruption and cost to your business.

2. Support

It is important that any software has great support for when something goes wrong (and it always does). Most major companies offer support but you also need to think about support in your local area. It's often much easier to have someone locally come in and do things you need done with your software than have someone trying to help you over the phone. Make some
enquiries with other businesses about the package they use and who helps them.

3. Accountant Interface

It's most unlikely you will handle every aspect of your businesses accounting. Your accountant is an important factor in making the right decision. What software are they used to working with and what do they prefer? Can you easily supply them data and reports from your package without the need for any extra work (which you'll have to pay for). Don't be afraid to ask their opinion as they live and breathe this stuff.

4. Best Value For Money

Once you have selected the right package for your business you may as well get the best value. Shop around as the price can vary greatly and the product is exactly the same. Online merchants such as Amazon may offer better pricing because of the sheer volume of products they sell. However price is only one part of the equation so if their is great merchant locally with support or installation assistance this may be far more valuable.

5. Major Brands

There are two major players in the small business accounting software market. They are QuickBooks and Peachtree. Microsoft is expected to enter the market soon. I recommend choosing a major brand so that you can get regular updates and you know the company will be around as long as your business needs them.

6. Ease of Use

Ease of use is a personal thing but it is worth trying the software before you buy it if you can. Remember to get the person who will be the main user to test the software as well. Also consider how well the package can interact with other software you use. This is an advantage the Microsoft package may have when it's available.

7. Features Needed

I touched on this earlier when talking about thinking ahead as to where you business will be in 5 or 10 years time. Most accounting software packages come in several different versions. If you don't need certain features now and can't see a need for them in the future then don't buy them. The major differences are usually - number of users allowed, inventory management capability and number of reports available.

To sum up think ahead when planning your purchase of small business accounting software. You will make a much smarter business decision that will save you plenty of trouble and money in the future.

About the author:
Please visit us for more information and a feature by feature comparison of:
Small Business Accounting Software

Great Essential Tools for Starting and Maintaining a Small Business

We believe that there are 3 factors that drive the success of small businesses.


1) Acquiring start-up capital
2) Finding customers
3) Accounting for, budgeting and controlling sales and expenses



The following resources will help your small business achieve these success factors.

Acquiring Start-Up Capital


An adequate supply of capital is essential as many profitable businesses fail because they don’t have enough cash to pay their employees and suppliers. But what is an adequate supply of capital? The only way to tell is by doing a significant amount of research on your potential market and formally documenting this in a business plan. I’m sure you know that a business plan is a very important document that is crucial to convincing your banker to lend you money.


There are two ways to obtain a business plan.


1) Do it yourself by amending a business plan template, or
2) Hire a professional to do it for you.


Obviously obtain 1) will be a great deal cheaper.


Our research led to a website that has over 60 high quality and free business plan templates. We also found a directory that you can use to easily find a business plan writer in your city – where ever you live in the world.


Finding Customers


Finding customers is a difficult and expensive task for service business owners such as accountants, lawyers and plumbers. We believe that a cost effective marketing strategy for service business owners is to simply give all their personal contacts a few business cards.


Our research led to a few websites that have pre-designed business card templates. We felt that the diversity and quality of these designs was outstanding. In addition, we found that you can obtain a significant saving by finding a printing service on the Internet. We found that you could get 2,000 full color business cards for as little as US $150.


Accounting For, Budgeting and Controlling Revenue and Expenses


Accurate accounting is very important for small business owners. It’s essential that you have timely access to information that could make or break your business. If stocks are running low – you need to know about it. If a large proportion of your debtors haven’t paid – you need to know about it. If you do not react to these situations quickly you may have a situation where you don’t have enough money to pay your employees – or worse still someone is stealing cash out the till.


Our research led to a website that compares and reviews top accounting software for small businesses. The cheapest software cost US $89.99 and the most expensive software cost US $1,499. It was interesting to note that the top 3 ranked websites were not the most expensive and cost between US $250 - US $300.


Hopefully you now have an idea of some of the tools that you can use to grow and maintain your small business. If you would like to benefit from our research please visit our website. We do not charge for this research and offer the content freely on our website.


About the author:
http://www.best-quality-small-business-resources.com/

Ryan Hough is the webmaster of best quality small business resources.com, who's aim is to help you save time and money by finding reviews and case studies that will enable you to choose the best resources at the right price.