An Exciting Year Ahead

Vicki was asked to sit down with the product development team and discuss the challenges that she foresees in this area and what we would all need in order for this to be a success.

It has been a week since 5 of our team members attended QB Connect at the Metro Convention Centre. The conference is held by Intuit each year in 3 locations throughout the world. The conference brings in representatives of many of third-party apps, such as Receipt Bank, and also has many breakout sessions to discuss the future of business and with that how the accounting industry will be impacted.

Intuit also highlights its road map for the next year and beyond. Two of the items on this year’s road map are the fetching of the bank statements with the last transaction of the statement period and the ability to file GST/HST right out of your QBO file.

Bank fetching is fairly straight-forward and many of you are currently using Hubdoc as a way to automatically do this for you. This is also a feature that will be released any day now in Receipt Bank. For those not using a document management program for storing receipts and expenses, this will be a great feature to have right in your QBO file.

In terms of the ability to file sales tax right out of the QBO file, this is one that will require additional changes to what we are currently seeing in QBO today. Vicki was asked to sit down with the product development team and discuss the challenges that she foresees in this area and what we would all need in order for this to be a success. This will be an area that we are keeping an eye on and are anticipating on seeing the first version sometime this spring.

Other items that we can expect to see coming in 2019 are: progress invoicing (currently in beta), advanced payroll on-boarding, and enhancements to QB assistant.

A couple of you have had a sneak peak at progress invoicing.For the advanced payroll something that is currently lacking and will be coming out is the ability to breakout payroll to projects… think true job costing. For the construction and trade industries this is huge. This has been a limiting factor for those of you who were interested in moving out of desktop to the cloud, but it is coming!

If you have not yet tried QB assistant, it is a neat little feature that is available in QB labs. What it allows you to do is ask QBO questions (through text or voice recognition) about your company data. Instead of needing to know how to manipulate your reports, you can talk in real language. 

Listen to the following video as Jeff Cates (President of Intuit Canada) asks QB Assistant “Who owes me money”

After another great conference experience, we are looking forward to what 2019 has in store of all of you!

Five Steps to Controlled Growth

Our 5 steps for growing your business while increasing profitability

1. Get your team involved:

Your team will need to know what you are up to. They need to know and understand your goals.  How can you expect them to go on this journey with you if they don’t know where you are trying to go, how you want to get there and what you are going to do?

Get them involved in the process.  There are two ways to increase profitability: Revenue and reduction of expenses.   It’s amazing what solutions your team will come up with.  We guarantee there will be at least one that you would never have thought of!

2. Make an quarterly action plan

We aren’t talking a 100 page full cycle plan here.  We are talking about a 1 page plan. Break it down in to action steps.  You should be determining where you are today and what you need to do in the next 90 days.  This should then be broken down further into monthly and then weekly steps.

This isn’t an all encompassing task.  You likely aren’t going to get it right the first time anyway.  But the more your team does this the better you will get at it and the most successful you will become.

3. Measure your key performance indicators weekly

(see our prior post “Cash is King!” for what a key performance indicator is)

Most business use historical information to make their decisions, often last year’s financial statements that may now be 4 to 6 months after your year end.  Is the best way to make decisions today to base those on numbers from as long ago as 18 months? We think not.

With today’s technology you are capable of getting real time results.  This can be a hard adjustment from the traditional desktop accounting software.  It’s well worth the learning curve and your access to information will improve 10 fold!

4. Give bonuses, not raises

When you give a bonus, the money is already in the bank and based off of actual performance.  When you give a raise you are increasing expenses forever!  If you actively engage your team they will understand how their bonus was calculated and be engaged to continue to help the company grow.  Don’t jeopardize your cash flow by giving raises.

5. No accounts receivable

Try driving past the first window at Tim Horton’s and see what you get at the second window?  They don’t do credit and neither should you!

As soon as you carry a receivable you have entered the banking business.  If a client/customer doesn’t pay on time they will crush your cash flow, especially if you have to remit that pesky HST to CRA before they have paid.

If you would like further information on any of this points or help in putting any of them in place, please reach out to us.  We are here to help.

Five things everyone should know before starting a business

You’re ready to take the plunge and start a business. You’ve thought long and hard about it, made a business plan and ready…now what? What should you know before you open your doors?

Five things everyone should know before starting a business:

1. Manage debt

For any new business a certain amount of debt is inevitable.  Unfortunately, expenses come before income.  Many new companies have to borrow money to finance leaseholds, equipment and initial operating expenses.  Financing is an important part in managing and growing your business.

What you need to watch out for is the level of debt you take on.  When debt payments get too high they quickly become unmanageable greatly affecting your business.  Debt can be a tool to help you grow but it must be within the financial constraints of your business.

2. Find mentors

You might assume an owner at the top of their field has little to learn, but everyone can improve.  A new business owner can greatly improve their business by seeking out a mentor with more experience.  It will also likely help you not make the same mistake they made. New business owners will have to make decisions they have not had to before.  Having a mentor’s guidance and perspective can give you an alternative to the challenges you face.

3. Find stress relief

This is crucial!  You will be under deadlines you never imagined, juggling cash flow, employee and customer personalities and a never ending workload.   Finding stress relief will sharpen your attention, memory and ability to deal with others.  It will also help to prevent this stress from creeping into your personal life.  Find something you enjoy doing; running, walking the dog, playing with your kids or mediation.  Managing your stress is the best way to improve everything!

 4. Think twice and then a third time before hiring

A bad hiring decision is one of the most costly mistakes you can make.  It can drain your bank account and suck all the energy out of your daily like.  You often don’t realize the effect the employee has on you until they are no longer there.  The opposite is true of a good hire.  They can transform your business and make you a better leader.

Is a 30 minute interview really enough to judge how well the individual will perform?  It is crucial to assess your candidate’s skills by giving them a practical test to give you a better idea of the impact they will have on your business.  We know of one company that puts each potential hire through a 2 day paid virtual skills assessment before offering anyone a position.

5. Don’t forget about tax planning

It can be difficult to separate business financial planning and personal tax planning.  This is a great reason to work with an independent advisor.  Bear in mind that the best business decisions are not usually the best tax decisions.  It’s important to be able to manage the two together.  Having someone to advise you what the right salary, dividend and retained earnings is worth their weight in gold.

Remember no one is expecting a new business to have all the skills they need day one.  Most of these skills are learned the hard way, by making mistakes along the way.

As advisors that have worked with hundreds of business owners, we have seen some swamped in debt make a full recovery and go on to be highly successful.  Seeking advice when you need it and finding the right advisor you can trust is the best advice out there.

 

Six Ways Cloud Software Benefits Your Business

What is cloud accounting? How does it any different from traditional accounting software?

These are questions we answer quite often with clients. There is a lot of confusion over what exactly the benefits of moving to a cloud-based accounting system and how it can assist in growing your business.

Cloud accounting is an accounting system that is available over the internet and allows you to access your data from anywhere. With an increase to the number of individuals working remote and travelling for work, cloud accounting systems allow you to have access to your information regardless of your location.

1. Security

Security is a popular concern of users of cloud accounting, as it should be. Your accounting records are a crucial piece to your business decisions. It needs to be secure from unauthorized transactions. Cloud accounting software uses the same security as the banks.

Your data is backed up automatically. Canadian cloud-based accounting solutions store the backup data on Canadian soil. There is end-to-end encryption. Online accounting includes additional security features, such as two-factor authentication, firewalls, and redundant backup for your security.

2. Access to Information from Anywhere

An advantage of cloud accounting is that your data is available to you wherever you have internet access. You can access your financial information by way of a desktop computer, notebook, tablet or phone. Software updates are installed automatically, without interrupting your access.

3. Hardware and Space Requirement

With a cloud accounting system, your accounting data and applications are hosted on virtual servers. This results in not incurring expenses for installation and maintenance of physical equipment that would be required for a traditional accounting system. In addition, the costs of maintaining the accounting software and equipment in removed.

4. Multi-User Access

A unique feature of cloud accounting systems as opposed to traditional accounting systems, is that multiple users such as employees, management, your bookkeeper and your accountant can access and work on the same data file at the same time, from anywhere they have internet access. Collaboration can occur in real-time, providing the ability for your accounting system and related business functions to run simultaneously.

5.Automatic Backups

Backups through a cloud based system are taken automatically. Backups are in real-time, eliminating issues with corrupt files and lost data. In the event of a computer failure or other disaster your data is safe and you can continue on from where you left off

6. Audit Proofed

The last benefit we will touch on here is our clients favourite. For many of them, this is a source of anxiety relief. With cloud accounting systems you can audit proof your records. The systems we recommend for our clients allow for the ability to attach the receipts, invoices and contracts associated with expenses right to the journal entry. Instead of having to search, or worse request duplicate invoices from third parties for CRA audits, the source document is in your records.

These are just some of the highlights of having a cloud-based accounting system. Contact us for further information on how we can help you with your transition to the cloud.

Where Do I Start?

You woke up today ready to jump to the cloud with your accounting and bookkeeping…now what?

You woke up today ready to jump to the cloud with your accounting and bookkeeping…now what? What does that look like for you? How do you go about actually moving your bookkeeping to a cloud system? Which system do you use? Which version? How much does it cost?

The first decision is which accounting software to use. We support both QuickBooks Online and Xero, however since QuickBooks Online is the current market leader in Canada today we will focus specifically on its online offerings.

Before selecting a version it is important to note that you cannot currently downgrade your QuickBooks Online plan. While this is something that has been announced as coming to Canada within the next couple of years, it is not available today and a date of release in unknown.

With that in mind, we will start our discussion at the highest plan and work our way down.

QuickBooks Plus

QuickBooks Plus is the full service plan. It has all of the offerings of the other plans in addition to the following:

If you have the need to track your products on hand, costs of goods sold and receive notifications when inventory is low this is the plan for you.

It is also made for those businesses that have a need to track multi-currency.

Finally for those who are interested in creating and managing budgets within their software QuickBooks Plus is needed. The budget feature will allow users to create a budget from scratch or use a previous year’s data. In additional you can track the budget progress by the dollar amount or by percentage and run budgeting reports.

QuickBooks Essentials

If you are not in need of the additional features offered with QuickBooks Plus, then you can move down a plan. Next let’s look at whether you need QuickBooks Essential.

QuickBooks Essentials is the plan that most businesses find themselves needing. The draw to this plan is when your business is looking to manage bills, track time and has multiple users.

The manage bills features allows for your business to track bill status, record payments and create recurring payments. You can pay multiple vendors and bills at the same time and if still using cheques you can create these and print.

For those businesses that are looking to provide access to multiple users, you do not need to include your bookkeeper and accountant into this number. QuickBooks Online allows business on all plans 2 accountant/bookkeeper users. For your other users, you are able to control the user-access levels and share reports. Each user is provided their own login.

Tracking time is also a feature of QuickBooks Essentials. This feature allows you to record employee times and billable hours. Billable hours can be tracked by client or employee and can be automatically added to the client invoices. A feature that our clients love is that they can create a user for their employees that allows their employee special access to enter hours. You are also able to enter the hours for your employees yourself. For businesses using applications such as T-Sheets, the applications can be integrated to pull directly into QuickBooks Online.

QuickBooks EasyStart

If you have found that QuickBooks Essentials is also more powerful than your current needs then QuickBooks EasyStart may be right for you at this time.

Features available for QuickBooks EasyStart are the ability to track income and expenses, invoice and accept payments, run reports, send estimates, track sales and calculate sales tax.

While QuickBooks EasyStart is a limited option, it still provides the ability to have a balance sheet and income statement for your business.

QuickBooks Self-Employed

A newer option that is available for self-employed individuals who have the need to prepare invoices, track expenses and mileage is QuickBooks Self-Employed. QuickBooks Self-Employed is available for individuals whom are on their own and have an unincorporated business. For these individuals they have a need to track their income and expenses for tax purposes only and do not require a balance sheet.

The following can be used to assist you with your path to the cloud.

1_Badge_Online_large