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Explore The Possibility Of Making Your Business Grow With These 3 Amazing Tips

Most people think that small businesses do not have a chance to grow when their budget is very limited. But this statement does not hold importance because if any small business focuses well on creating a strong value proposition for the customers, then the road to success for that small business will be paved with gold. If you are a small business owner and wish to make your business venture grow, here are some of the expert tips that you can follow in order to turn your dreams into a reality.

Setting Up A New Shop

It is perfectly understandable that small business owners do not have adequate capital to set up a new store. But the reason why this idea has been mentioned in the beginning is to make people understand that starting up a new shop is not the only way you can make your business grow.

Expansion in terms of the physical location of where the business is set up is no doubt an important factor that contributes to the growth of a business venture but is not the only option. In order to fulfill the dream of expanding your business location wise, it is important that you divide your profit margin into two; one for your monthly expenses and the other set aside for the down payment of setting up a new shop.

Obtaining A License For Your Product

Small business owners usually feel that product licensing is not important since the business that they are running is on a small scale but this isn’t the right approach if you wish to expand your business in the future. Think of having your product licensed as a low cost business growth medium especially if your product falls under the branded product or service product category.

The reason why this is an important step for small businesses is that if lady luck shines down on you and your product is highly successful, you might actually receive royalties and upfront amounts for consistent sales or use of your product or brand’s name. This is considered a highly effective business growth option that does not cost much but mitigates your risk. Plus, it is a much better option for those businessmen who are not looking to start a company of their own in order to sell their product.

Use The Diversification Strategy

Another efficient method you can put to use is the diversification strategy to help your business venture grow. The concept of the diversification strategy is quite simple. You can start offering complementary services or products on the side. This will not only help in generating extra revenue but also increase your product line which will become a foundation for other products to follow in the future.

If this idea doesn’t seem plausible to you, you can start importing other’s products or start exporting yours in order to reach out to more customers. Experts always believe that the diversification strategy is a brilliant idea that can make even humble beginnings turn into profitable business ventures in no time.

Small business owners who find difficulty in book keeping or face accounting related issues in their business can hire a CPA or CFO on a daily, monthly or yearly contract basis through SK Financial CPA.

4 Easy Ways By Which Glitches In The Cash Flows Of Small Businesses Can Be Fixed

Businessmen who run small business usually worry over their cash flows not being positive even when their sales are running smoothly but somehow there is just not enough cash to make ends meet every month. The only possible cause behind this problem is that your customers are buying stuff from you on credit and they make late payments. But if this is not the case, then take a look at the 4 easy ways for fixing glitches in the cash flows of small businesses.

Don’t Slack When It Comes To Billing Clients

This is especially important if your business operates on credit payments. There is no way you can dilly-dally when it comes to sending out invoices to customers on time. Remember that if you do not send in the invoices immediately when the current month comes to a close, your customers won’t make payments on time which will eventually lead to problems in your cash flow statement. The best way to ensure timely payments from customers every month is to mail the invoice as soon as the job gets completed.

Increasing Prices When Needed

When starting a new business, small business owners have to sell out their products at ridiculously low prices in order to attract customers but by doing this, they barely make any profit. In fact, only the cost of the product is covered in the initial stages of establishing a business. Once you determine that the sales aspect of the business is going strong and customers keep coming in, it is time to increase the price of your product. However, it is important to raise the price gradually so that it does not bring a dry spell for the business in the coming weeks.

Get Hold Of Retainer Clients

Doing business is risky because sales are not guaranteed. There may be times when tons of customers will come barging in and then suddenly there will be days when the business won’t do as well as it should. If you are a lawyer or repair man offering services, you can easily battle the dry spell in doing business by getting hold of retainer clients so that you get fixed monthly payments for the services you render. Getting hold of retainer clients is undoubtedly the best way to tackle irregularities in the cash flows of your business.

Start Accepting Credit Cards

Last but not the least; you can fix your cash flows by accepting credit cards. Even though most small business owners prefer to operate their business on cash only, accepting credit cards is a great way to minimize the risk of receiving late payments. When running a business, it is important to facilitate customers as much as possible since people tend to stick to the businesses that they find convenient and flexible in terms of making payments. With credit cards, you can receive your pending payments within a day or two as compared to 30 days when customers are only asked to pay cash.

If you are having trouble with adjusting and balancing your accounts at the end of the month, contact SK Financial CPA to provide you with CFOs and CPAs on a contract basis to help you with book keeping.

How To Manage Debtors To Keep The Cash Flow Positive

Cash flow management is one of the most important aspects of a business that should never be taken for granted. If the cash flow management of a business is not smooth, it can face numerous financial and reputation-based issues, which just become more complex as the time goes by.

Big businesses that supply goods to their customers on credit mostly go through numerous debtor management issues, which can lead to financial issues for the business and a negative business cash flow.

Following are some tips for such businesses to effectively manage their debtors:

1- Adjust Accordingly

No client is the same. A business has a set of old clients that are trustworthy and new clients who cannot be trusted so much. Therefore, a business should keep the credit allowance and credit terms based on the type of customer it is dealing with.

Moreover, important information of all the clients asking for credit terms, whether they are new or old clients, should be sought which includes credit score, bank history, bank terms and financial transactions. All of this information should be evaluated before deciding the credit terms or thinking about allowing credit to the clients. If the financial information provided by the client seems too risky, the business can run a credit check on the client, just to be safe.

2- Make Everything Clear

While dealing with finances, businesses should not leave a room for doubt for the client. All the conditions should be well-communicated to avoid any future problems. Make sure that you give a precise due date of payment to the clients and stress it over so that it is taken very seriously.

If the payment is scheduled to be received after a few months, bi-monthly reminders should be sent to the client to assure that a thorough follow-up is in practice. Not notifying the client for a few months and then straight away calling them up for payment is a major mistake that most businesses make which results in delayed payments.

All the credit terms should also be well-understood by the client so that future scrutiny can be avoided.

3- Provide Numerous Methods

Businesses that provide their customers a vast range of payment options are more likely to get paid on time as it increases the ease of payment. Methods such as online banking and internet payment methods (for small payments) should be set-up so that the client can make the payment with absolute ease.

4- Installments

 Financial experts suggest that huge payments should be broken down into installments to ensure that timely payments are received and that the clients are not intimidated with paying a huge amount all in one go. This works best in keeping the cash flow positive and also decreases the financial risk in case the client defaults.

5- Default Cases

In cases of big payments, there is a higher chance that the debtors default in which a business can choose to hire a debt collection agency, if all the negotiations fail.

Top Abilities That Should Be Present In Every Human Resource Manager

A Human Resource manager tackles numerous management and leadership facets within an organization. Therefore, it is very difficult to pinpoint the number of areas that a human resource manager should work on. However, there are some qualities, which are important in every manager in order to be successful at their job.

The biggest challenge in management success is the fact that a manager should be the kind of an individual everyone must love to follow and admire. Every action taken by a manager decides whether other people would like to follow him/her or not.

Following are some of the traits of successful Human Resource managers:

1- Ability to build interpersonal relationships

An effective manager should always be able to build responsive and effective interpersonal relationships with people in a business organization. Therefore, a manager in the true essence is the “people’s person”. Giving respect to executives, colleagues, and staff members is a quintessential in building interpersonal relationships.

Apart from that, a good manager also cares about people and tries to offer them support and assistance whenever required. Attentiveness is a key quality of a good manager as he tries to collaborate with the staff members, enabling them to reach their true potential.

2- Ability to communicate

Let it be in person, email or print, a good Human Resource manager knows how to communicate well and effectively with everyone present in a business organization. Ability to listen to people is also an important characteristic of good communication and must be practiced in a well-settled organization.

 A manager will not be able to get his message across or motivate his team until he listens to their problems and then effectively communicates the solutions to them.

3- Team building

The ability to build a team, motivate it, and lead it are all prime characteristics of a successful Human Resource manager. Under such a manager, the staff tends to be more productive, creative, and effective at their work. Inducing motivation in the staff is the fundamental job of the manager as this is the only thing that can work towards increasing their productivity levels.

4- Financial management

Financial management is an important aspect of a HR manager’s job and hence he/she is responsible to measure and set financial goals for a business organization. Analyzing and documenting the success and progress of the employees is also extremely important in human resource management.

5- Positivity

It is absolutely normal for business organization to sometimes fall into the pits of negativity and hence the role of a successful human resource manager is to foster recognition and positive morale in employees to keep them motivated so that an organization can reach its desired goals. If the workforce is recognized for their hard work, it will automatically be motivated to perform better for the business.

6- Promoting growth

An effective human resource manager is more interested in polishing out skills and natural talents present in the employees rather than giving them strict commands.

An Emotionally Intelligent Workforce Can Grow Your Business

Employees work for money – this is a universally known and accepted phenomenon. Many employees would not be doing the job they are doing if not for the money. This leads to them performing their duties without putting in their heart and soul. They do the minimum required to complete the job and get the salary at the end of the month. This sounds alright because as long as they are doing their job, the business is also achieving its goals.

But you will also see that regardless of the fact that they are motivated by money, you cannot get the same level of performance every month for the same salary. This is because employees are influenced by emotions.

Therefore what businesses need to realize is that if they want to progress and grow and become successful, they need an actively engaged workforce who does their job happily and willingly. An actively engaged workforce performs to their true potential and can take businesses to new heights through their superior performance. So how can you make your employees like their jobs and perform the work happily for you?

The answer is quite simple; enhance the emotional intelligence of your people. Emotional intelligence is about understanding and managing emotions at the workplace. An emotionally intelligent workforce will effectively manage relationships with:

  • Colleagues, superiors and junior staff;
  • Customers, business partners, suppliers, vendors;
  • Networks and contacts.

How an Emotionally Intelligent Workforce Enhances Business Growth Potential

An emotionally intelligent workforce is:

  • Highly motivated thus highly productive;
  • Happy and efficient;
  • Committed to their work and success of the business;
  • More confident thus more effective and efficient;
  • More likeable, friendly, mature and professional thus working successfully as leaders and as team members.

A business operates and grows due to efforts of the people working in favor of its success. When these people work in harmony, through management of their emotions, there will be:

  • Lesser workplace conflicts
  • More openness towards diverse opinions giving room to creativity and innovation
  • More openness to technology and change
  • Better leaders who understand their workforce
  • Better ability amongst workers to receive critical feedback positively.

Develop Emotional Intelligence in Your Workplace

If you also want your people to work with synergy so that your business can grow, follow these four steps:

  • Assess the current level of emotional intelligence at your workplace and communicate the results to your people. Prepare them by communicating to them the requirement for enhancing emotional intelligence in your business;
  • Train people through formal and informal means and show them how they can increase their own emotional intelligence and practice emotionally intelligent behaviors in the workplace and their personal lives as well;
  • Encourage people to practice emotionally intelligent behaviors at the workplace by recognizing their behaviors and rewarding them accordingly;
  • Evaluate the progress of your business, transfer the benefits to your employees and show people how being emotionally intelligent has helped the business grow and has also helped their careers.

Remember, an emotionally intelligent workforce is an actively engaged workforce that works to their true potential, thus raising output levels to a stage where the business achieves success and growth.

HR Audit – Paving Way for Your Business’s Success

Businesses today are realizing the important role an HR department can play in determining a business’s success through deployment of a top class workforce. This realization has led HR to emerge as a strategic business partner as compared to being only a support function as it was in the old times.

A business is dependent not only on the quality of its products, but also on the quality of its people, especially if it is involved in providing services. Regardless of how proficient your processes are, if the people working for you are not performing for your business, your success will be limited.

The rule for success is quite simple, an engaged workforce can lead your business to success. The rules and regulations of the system that your HR has defined, determine how engaged your workforce is and whether that engaged workforce is doing the right things at the right time in the right way to achieve the right results.

So how would you know whether your HR is doing their job correctly or not? Just like you evaluate the performance of other departments in your business, you need to evaluate your HR department through an HR audit.

The HR Audit

HR audit allows businesses to evaluate how well the HR department is operating within the business. It makes visible the strengths and weaknesses of your HR function and allow you to identify areas for improvement. It allows you to determine whether your HR department is:

  • Effectively utilizing the available human resources with the business
  • Following the set policies, rules and regulations concerning human resources
  • Streamlining business goals with the goals of the human resources

By doing an HR audit, you are able to identify exactly where your HR department is currently standing. Divide the existing issues with the HR department into different categories including:

  • Whether the issue is critical and has a substantive impact on your business’s success or is a minor procedural issue that can be easily resolved without having much impact on existing processes;
  • Whether the issue is strategic in nature or more relevant to day-to-day operations of your business.

Once you have divided the identified issues, you can conduct the following analysis:

  • Those HR issues that are strategic in nature and also have a substantive impact on your business’s success are policy issues and thus require you to redesign your HR policies;
  • Those HR issues that are minor procedural issues but are strategic in nature require you to redefine your business’s culture because the culture is a strategic element that is inculcated in all your procedures;
  • Those HR issues that are inherent in the day-to-day operations of your business and are substantive in nature are efficiency issues and have a direct impact on how efficient your business is in the long term;
  • Those HR issues that are inherent in the day-to-day operations of your business but are minor can be fixed by improving the climatic or the working environment of your business.

Resolving issues identified during the HR audit can lead to creation of user friend HR systems that automatically help in engaging the workforce towards taking your business on the road to success!

Management Functions That Will Keep Your Business on Track

What is management? To understand management, firstly, the true meaning of management must be understood. A business combines several functions at small and large scales to execute a common goal through strategies that are not ideal, but effective for the success of the business in the long term.

Several business functions include:

  • Utilizing Resources
  • Managing Resources
  • Coordinating Activities
  • Selling Products
  • Offering Services
  • Creating Jobs
  • Preparing Budgets, Forecasts and Financial Accounting
  • Payroll Activities
  • Human Resource Activities

All the above functions of the business need a force to bind them together. This binding force of the functions of the business is known as management. Management is commonly explained as an art that coordinates people’s efforts to achieve goals and aims of a business using the resources available efficiently.

Management brings discipline to a business environment. It combines the functions of organizing, planning, controlling, formulating policies and steering a firm’s resources in the right direction to achieve the policy’s objectives.

One of the most important management functions these days is organizational development (OD). With a fast change in technology, people’s intellect, and the world moving towards scarce resources, an organization must properly organize itself to use every resource to its benefit rather than wasting it.

Organizational development takes notice of the changing management needs of a business and tries to cope with them and ensuring that the needs are met immediately. Organizational development is a business process that involves efforts to change people’s attitudes, relationship styles, belief systems etc. for collective benefit of the employees and the organization.

Organizational development was previously categorized as HR function but recently the relative importance of this function has made a separately recognized function. OD is regarded as a strategic business management function that executes various roles in a business.

  • It ensures a balanced organizational climate.

The OD management function helps structuralize the organization and educating the employees with the art of multi-tasking. It helps reduce the number of people or employees by using technology making the production or work process more efficient.It encourages teamwork and train managers to treat the business as their own asset adopting appropriate leadership styles at all levels. Periodic training and effective communication are some of the other roles of the OD function.

  • Installation of PMS – Performance Management Systems

This involves setting clear parameters for performance through job targets, policies and procedures and making these performance levels known. Informing about inadequate performance, warnings and ensuring supply of essential resources is key to efficiency.

  • Minding the cash outflow by:

o   ensuring resource accountability, reviewing and monitoring the pattern of resource utilization and eliminating wastage

o   use of latest technology to execute tasks that prove cost and energy efficient

o   developing the thinking of managers and executives to adopt cost efficient  ways of achieving the goal

o   Identifying employees that contribute to increasing costs and monitor their attitudes and behavior during work hours, and counseling them as a cost reduction initiative

SK Financials provides with a complete guide for startups and growing businesses on how to survive the tight competition. For more info, visit: www.skfinancial.com

Audits: Keeping Your Business Activities Pure

Many new businesses might not know of or heard of the word ‘‘audit’’. It is a planned and recognized action of qualified personnel to analyze the acceptability and compliance with the established processes and the effectiveness of application.

An audit is a vast field that monitors and analyses the different departments of a business like accounting, project, quality management, internal controls and energy conservation. The term ‘‘Audit’’is divided into two categories:

  • Internal Audit
  • External Audit

Internal Audit                                                     

This function has a separate department in a business setting where it operates independently and reports to the audit committee.  Employees of an organization are the members of an audit committee and perform both, financial and non-financial audits.

The internal audit has the key function of looking over the business environment for risk possibilities and managing those risks to achieve company’s objectives.

External Audit

This department is independent of the organization and functions outside. They have a sole focus on financial statements of a company, their accuracy and reliability and for this purpose; the shareholders do the appointment of the audit team.

The external audit team performs the statutory annual audit and provides an opinion on the truthfulness and fairness of the financial position of a business.Their responsibility includes the examination and assessment of internal controls that are in place to negate risks related to financial accounts and to determine their intention.

An auditor works on a specific criterion using a company’s adopted policies, procedures and requirements for reference. The internal audit is a detailed internal inspection of the organization conducted by its independent employees because it is hard for the management to view the several activities in the organization. It is necessary for a company to observe the processes and match their performance with a proposed criterion.

Apart from the major function performed by external auditors, they also help the owners of a business and other organizations to place reliance on a company’s financial statements. Some stakeholders, other than the shareholders that count on the accuracy of the audited financial statements are:

  • Tax Authorities
  • Financial Institutions
  • Management

Some companies do not know the exact work an auditor performs. What they do not do is:

  • Audit information provided by members of the organization like the director’s report.
  • Check every financial statement figure because audits are a product of selective testing.
  • Judge the suitability of an organization’s activities, strategies and decisions.
  • Test appropriateness of the internal controls of an organization.
  • Comment on the quality of directors and their governance, to the shareholders.

What auditors cannot do is:

  • Predict the future and provide assurance on a forward-looking strategy.
  • Be at the organization at all times because audits require defined timeframes.

Audits are conducted to eliminate inefficiencies in the business process and to help present the true and fair financial position of the business.

At SK Financial, we specialize in providing audit protection. Visit www.skfinancial.com for more information.

Human Resources Are the Driving Force of Any Business

Human Resources are the group of individuals who specializes in forming, binding and maintaining the workforce of a firm, business sector or an industry. They play a vital part in any organization to get things done the right way. Therefore, it is imperative to setup an efficient human resource department because without it, businesses cannot carry out their day-to-day functions optimally.

An organization cannot build a great team of professionals without adequate human resources. Most of the small business owners do not have HR departments because they are the sole owner and operator of their business. The owners themselves take care of the hiring and firing of the employees and analyze the performance of each of the employees, and provide them with adequate benefits and compensations.

On the other hand, when we talk about large organizations, the HR department plays an important role in the success of the organization. What good would be a business without professionally trained employees who are ready to infuse their skills into the business? The main purpose of a HR department is to seek out individuals with potential and skills relevant to the business and motivate them to unleash their potential for the benefit of the organization.

Functions of a HR Department

The prominent functions of a Human Resource department include:

  • Recruiting people
  • Selection and Screening process
  • Training new employees
  • Compensation
  • Performance appraisals
  • Informing about the company policies on workplace safety
  • Motivating employees
  • Workplace communication
  • Organizational hierarchy

The basic function that the HR department performs before hiring an employee is participating in a decision-making process, where it outlines the staffing needs, the personal qualities of an individual, his/her abilities and skills necessary to be an asset to the business. HR compensation specialists scrutinize and conduct right compensation measures according to the duties of the new employee.

Another important role of the HR Department is to reduce the potential liability to the firm after a new recruitment and maintaining the company atmosphere. Through an effective selection and screening process, HR manages to lower the allegations of unfair practices in employment. They identify and resolve workplace issues that are unattended and could spiral out of control. They help keep the company safe from legal issues that can hold on for long periods.

Maintaining workplace atmosphere is essential to create a positive environment for employees that come every day and perform their duties with honesty and professionalism. The HR department makes sure that compliance is at every level of the organization from top to bottom.

Employee compensation is an important part of the HR management. Employees tend to get de-motivated when they are compensated inadequately. This breaks the sense of trust and responsibility in the employee, and the business may suffer due to poor performance. Payroll of employees should be according to the quality of work they deliver and each employee is to be treated differently rather than compensating everyone on the same level.

Therefore, HR plays a crucial role in binding the whole business together physically and mentally. It recognizes the need for human resources and the quality of work expected, and delivers individuals that are confident and motivated.

HR Tools for All Businesses

Human Resources is one of the most difficult departments to handle in a business. It has a lot of aspects to it and its assets, the employees, are the key to the whole organization. Good HR management techniques can make or break the entire organization!

There are some tools available online that can greatly help facilitate the HR processes in order to smoothly run the whole department.

Employee Cost Calculator

This calculator requires you to set the default expenses that incur for each employee. These include the equipments cost, the training costs and many other recruitment costs. While hiring the employee, you can either simply put in the numbers or use the default ones to calculate how much the employee is going to cost you exactly.

While this may seem like an unnecessary tool, it is not. At the time of hiring, there are so many aspects to consider that you usually forget a cost or two before calculating the hourly rate for your employee. These small miscalculations, as a whole, can cost you a lot more than you can imagine. This is why it is advisable to keep an Employee Cost Calculator in hand when hiring new employees.

Federal Poster Advisor

The U.S. Department of Labor requires all businesses to put up posters for related laws and regulations across the organization for all employees. The Federal Poster Advisor can help you identify the compulsory posters that you need for your office and provide you with a printable download version of them.

All you have to do is input some relevant details about your business to allow the tool to provide you with a list of posters that apply to your business sector. These posters can include ones for:

  • Equal Employment Opportunity
  • Employee Polygraph Protection Act
  • Fair Labor Standards and Minimum Wage
  • Family and Medical Leave Act

This tool is an excellent method of employing the rules and regulations set by the U.S. Department of Labor without having penalty imposed on your business.

Interview Questions Generator

No matter how expert you are at taking interviews, you can still miss out on important questions that may help you assess the prospective employee candidate for your organization. To help you out, you can use the Interview Questions Generator that has a built in set of questions that can help you assess the potential employee on a number of aspects including:

  • Leadership Skills
  • Teamwork Attitude
  • Interpersonal and Communication Skills
  • Out of the Box Thinking Skills
  • Analytical Skills

Only a good interview, that helps evaluate the prospective employee from all angles, can help you find the ideal candidate for the job on offer.

Salary Benchmarking Tool

This tool helps you find out just how much the salary is being offered for a particular job position in different states of U.S. Using this tool, you can get a compensation report and an hourly rate report for a number of different job positions from a library covering over 800 positions in the U.S. Once you know the popular benchmark, you can easily set your own salary rate for the position at your organization.