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The role of a good small business CPA

A good small business CPA will provide its clients with advice beyond the areas of tax preparation and auditing

Many of our clients are small business owners. Even those who own big companies started a few years ago as small business owners. Small business is the backbone of our Canadian economy and should be treated as such. Therefore, A good small business CPA will provide its clients with advice beyond the areas of tax preparation and auditing, and will also help its clients capture the many business opportunities that are available to them in order for the maximize their profitability and reduce their liabilities.

Good small business CPA provide clients with advice in areas that are beyond tax preparation and auditing

In our role as a small business CPA, we meet many clients who can benefit from advice in areas that are beyond tax preparation and auditing. Many business owners can increase their profitability through a better understanding of how cash flows in their business, the true value of different business opportunities and the true value of assets and liabilities. For instance, the type of business structure you choose to have, whether it is a proprietorship, partnership, or corporation  will impact how you report your business income, the type of returns you have to complete, and many other aspects of your business. A good CPA will advise you on which business structure is most suitable for your business and the benefits that you are eligible for and how to increase your profitability.

Good small business CPA help clients capture business opportunities

A small business CPA should also help business owners capture opportunities for increasing profits that are not always so obvious to the untrained eye. An accountant has the advantage of having the full perspective of the financial situation of the business as well as the experience of dealing and improving different business situations for its clients. For instance, the following is one example of how a small business CPA could help clients improve their business situation. The Federal Budget 2017 has made changes to the way business professionals will report work in progress (WIP) on their income. This policy could mean that professionals such as lawyers, doctors, accountants, veterinarians, and chiropractors will have to pay more taxes upfront and stain their cash flow.  In order minimize this strain on business professionals income,  a good CPA will advise such professionals on the different options that are available to them.  Such recommendations  could include how they could change the way their WIP is calculated, the benefits of incorporating their practice, the advantage of creating a holding company for excess cash, as well as the value of splitting income with family members.  A good small business CPA will be well versed in the federal policies in place and will know which options are best for its clients in order to maximize opportunities and minimize any strain on their income so that the could carry on business as usual.

We believe that as a small business owner you can expect your CPA to give you this level of consulting.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

The benefits of good business accounting services

Good Business Accounting Will Help You Focus on What’s Important…Your Business

Professional business accounting services can save you money and time, but that is not all. A good accountant can also help you make more money, grow your business and avoid bad business decisions. Here is how:

Good business accounting services help save on taxes

If you are in any way similar to the typical business owner, you may be paying more tax than you should. A good accountant will make sure that you are reporting all the right business expenses without missing any opportunity to lower your tax bill. A good accountant will also find ways to structure your return, in compliance with the regulations, in a way that will minimize your taxes. The time invested in finding a good accountant can save you thousands in taxes. Note that tax laws are changing all the time and what worked for you last year may not be effective or even allowed this year. A good accountant will be up to date with the latest changes.

You won’t pay unnecessary fees and penalties

Once you’ve found a reliable business accounting service, you can relax knowing that your accountant keeps a watchful eye and won’t let you fall behind on your payment to government agencies and regulatory bodies. This will not only save you from unnecessary payments, but also from the unpleasant and restrictive effects of penalties for late payment.

You’ll save time on bureaucratic stuff

As a business owner you are probably less familiar with the accounting world than you are with your own business. This can become a time consuming issue in situations when you need to fill out specific forms, apply government programs or just deal effectively with CRA. Your accountant can save you precious time by helping you with these issues.

Your business will grow faster and safer

An experienced accountant may have already seen businesses in situations that are somewhat similar to yours. Your accountant has intimate knowledge of the financial aspects of your business and can help you evaluate new opportunities probably better than other advisors can. A good accountant should have the ability to analyze those opportunities from a cold, financial perspective that you may not have as someone who is deeply involved. Your accountant can help you identify opportunities for growth as well as those that need to be avoided.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

What does bookkeeping mean?

My clients often ask me ‘what does bookkeeping mean?

They wonder if bookkeeping is something that they could perform while running their business.

If you are amid the start up phase of your business, you might wonder if bookkeeping is something that you could perform yourself while running your business.  Whether or not you choose to employ a bookkeeper or are comfortable to bookkeep yourself, keeping your books in order is crucial to running any business. In fact, good bookkeeping practices will give you an excellent measure of how well your business is doing.

In the following article, I will explain what bookkeeping means, what are the different ways to bookkeep, as well as why it’s important to bookkeep.

What does bookkeeping mean?

Bookkeeping is a recording of financial transactions, which include purchases, sales, receipts, and payments by an individual or cooperation. Bookkeepers are responsible for accurately recording all the financial transactions of the business, whether it is a cash transaction or credit transaction. You would need certain skills and talents to perform a bookkeepers crucial job.

Bookkeepers must be detail oriented, be meticulous about accurately recording numbers in the books and it is to their advantage if they enjoy working with numbers. Bookkeepers must vigilantly maintain a paper or electronic trail, as well as filling and storing all essential backup data about the financial transactions recorded in the books.

What are the different ways to bookkeep?

A useful bookkeeping system is one that is easy to understand, simple to use, reliable, accurate, consistent and can provide you with the information you need in a timely manner.

The two different bookkeeping styles are: single entry and double entry bookkeeping
Single entry bookkeeping means that every dollar transaction is recorded only once, either as income or expense, an asset or a liability. All entries are recorded on a one page synoptic journal, also called a revenue and expense journal.

On the other hand, double entry bookkeeping means that each transaction is recorded twice, one account is credited with the given dollar amount and a second account is debited by an equal dollar amount.

You may use a one-write system or a computerized system to record your bookkeeping.
One-Write Systems are copyrighted systems are set up using carbon-backed cheques. As you write the information on a cheque, it also transfers the data to a record system.

Computerized Systems are programs that are advantageous because they usually have the ability to produce daily updated financial statements quickly and in versatile ways. Many of these systems are scalable, so you can add on as your business expands.

Why is it important to bookkeep?

It might seem tedious to record every financial transaction in your books, yet financial records can save you a great deal of effort and time in long run.

Good records will keep you up to date with your business’ past and present standing. They will assist you in making good business decisions. Good records will also help you meet different government agency requirements, which include: Canada Revenue  Agency, Canada Pension Plan, Employment Insurance, Department of Finance, Goods and Services Tax and Workers’ Compensation. Additionally, good records will help you make accurate and timely remittances. Finally, good records will increase the probability that your business will survive, stay in business and earn profit.

If you require additional consultation or a tax planning strategy, please do not hesitate to contact us. We serve clients in Toronto, North York, Vaughan, Thornhill, Richmond Hill, and all other GTA cities.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca

Accounting is not boring!

There is a common misconception that accountants are a bunch of math geeks who count beans, focus on crunching numbers and have zero communication skills. After years of working as an accountant, I’ve come to the realization that I rarely, if ever get bored with the profession.  And I am not the only one that feels this way. In a survey of more than 2,600 accounting professionals, nearly 7 out of 10 accountants said that they would stick with accounting if they could go back in time and choose a different career.

So what is so exciting about working in accounting?

Accountants are exposed to wide variety of career paths and solve complex problems. I will further delve into each of these points and and explore them separately.

Accountants are exposed to a wide variety of career paths

Accountants could make the profession their own.  Whether they choose to work for a government agency, school, charity, or professional agency to name a few, accountants could carve themselves a niche in the accounting industry. Michael Tumminia is one example of an accountant who did just that. Mr. Tumminia is an accountant who works  with top fashion models. He helps fashion models manage their financial lives and is the voice of reason and limits for the models. Mr. Tumminia says, “our job is to set up their life [models] in a way that is efficient, effective and allows them to focus on their careers.” Working with models such as Ashley Graham, Marquita Pring, Karlie Kloss, Toni Garn ”has made his ‘very programmatic, very technical job’ more fun and interesting”

Accountants may work full time for a given firm or they may take on multiple clients while being self-employed or as part of an accounting firm. Some accountants move vertically up the rungs of the accounting firm and some choose to move horizontally and may teach the profession.  There are some accountants that become high level managers, and others that start their own business using what they’ve learned during their time as accountants. For instance, “Mick Jagger may be known for his musical achievements and stage acrobatics, but did you know he could also rock a spreadsheet?”  “While studying accounting and finance at the London School of Economics on scholarship, Mick Jagger reunited with a childhood friend guitarist, Keith Richards” and pursued his interest in music.

Before they launched their music careers, Kenny G and Robert Plant of Led Zeppelin worked in accounting. Also, the person who invented the bubble gun was also an accountant.  Walter Diemer “was a fledgling accountant for the Fleer Chewing Gum Company in Philadelphia when he began testing recipes for a gum base – the part that makes gum chewy – in his spare time in 1928.  “He unwittingly created the first batch of bubble gum, making it pink because that was the only shade of food coloring on hand.” Now that’s something to chew on!

As you see there are a wide variety of career paths and many opportunities to explore different avenues and make accounting your own.

Accountants solve complex problems

Accounting is an intellectually challenging and even philosophical endeavor. Accountants employ a set of rules and concepts to prepare relatively simple financial statements that help capture and represent the financial truth of a company. Blogger Matthew Shaffer nicely articulates this: “The fundamental truth about a firm is actually fairly chaotic – a million different things of varying importance are going on at once -and we need to figure out rules for distilling some simple but accurate summary from this chaos.”

Another important point that blogger, Mr. Shaffer makes is that accounting is a ‘philosophical enterprise.’ “The world itself does not label things as ‘assets’ or ‘expenses’; rather, we humans decide which labels we apply to which things; and we set rules for doing so based off of imperfect intuitions and ideas that involve human social ideas like justice (i.e., we want accounting standards that will promote fair and beneficial outcomes for society as a whole via efficiency and transparency) and conservatism” (i.e., we want standards that will prevent managers of firms from being too optimistic when reporting the data).

Accounting helps companies distill useful trends and bring financial order to businesses. Joseph Rascoff, is one example of an accountant who is truly “intrigued by the challenge of bringing financial order to the [music] business”. Mr. Rascoff, was an accountant who displayed little passion for rock n’roll music. Yet, ended up becoming the powerful business manager and tour producer for music powerhouses such as the Rolling Stones, U2, and Paul Simon. “Although Mr. Rascoff preferred classical music, he immersed himself in the rock n’roll business and later in 2013 in electronic music because he was fascinated by the complexities of managing the business affairs of music artists.

Many accountants will agree that they rarely get bored with accounting. Perhaps this is because they have an opportunity to explore a variety of different career avenues and like detectives, they have an opportunity to piece complex things together in order to understand and decipher the bigger picture.

If you require consultation or have any questions related to accounting, please do not hesitate to contact us.

Polina Presman, CPA, CA

T- 416-371- 6017
F- 416-667-0404

Shani Marzin, CPA, CA

T- 416-731-9031
F- 416-667-0404

S&P Accounting Services LLP
2727 Steeles Ave. W. Suite 300
North York, ON, M3J 3G9
www.spaccountingservices.ca