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As a small business owner you will be faced with plenty of issues. Added to that is the fact that you may not get paid on time, your invoices could let lost or worse still you could lose track of your account! This is where an online invoicing system can be very helpful and help keep your finances organized.

Various features
Today the choices and features available with online invoicing systems are truly vast. You can easily track, report and account for your finances using these online invoice systems. The reason an online invoice is so beneficial as opposed to a conventional offline system is that you can actually send invoices and get payment in real time! Thus you no longer have to wait for payments or suffer delays at the hands of your customers.

Account options
Many of the online invoicing systems today even have an option where your customers can log into their account and check their account information easily. Thus customers can simply visit your site and check the status of their payments and purchases online!

Payment gateway integration
You can even use your online invoicing system to integrate it with an existing payment gateway you use, such as PayPal. If you already have a PayPal account you can integrate these online invoice systems with your account. This way, when you get paid online it will automatically reflect in your invoice and account as well.

Geographical redundancy
For most small business owners it is often required to travel a lot for various sourcing or other business options. This makes it difficult to keep track of invoices or payments. In such a scenario an online invoice system can help you keep track. No matter where you are located these systems allow you to log in from the comfort of home, from your local library or even any computer located on the Internet in order to track your payments. Such a facility can be extremely helpful for many medium and small scale business owners.

Faster payments
If you are a small scale business owner then it can be very hard to keep up with rising costs of the business. Added to this, if payments are reaching you late it could mean you having to shell out costs from your own pocket! Especially for small sized businesses the luxury of waiting for a payment is ruled out. In such a scenario an online invoice system can help you get access to payments much quicker. Since everything is integrated and happens online customers also find it easier to pay you! Most of the time, the main reason that holds back payments is the inconvenience of sending a check or other payment mode offline. When transactions happen online, things get speeded up and you no longer have to worry about a late payments again!

No hassles
The other good thing about online invoicing systems is that they are easy to use. Thus you don’t need to know complex accounting jargons or terminologies. Thus such online invoicing systems are best suited for freelance professionals, independent business persons and small business owners.

SimplifyThis.com is an intuitive and simple online invoicing solution. You can quickly invoice your customer, send reminders, and track payments. For more information please visit: http://www.simplifythis.com

Bookkeeping based upon cash accounting principles is the easiest accountancy practise but not necessarily the most accurate or beneficial for tax purposes for the business. This is because cash accounting adopts the date of financial documents such as sales invoices and purchase invoices as the automotive date for those primary financial records to be entered into the accounts.

The date entered on the sales or purchase receipt is called the tax point. The tax point does not determine the spread of that transaction over the tax period which can be different when accounts are prepared on an accruals basis as opposed to a cash basis.

For the purposes of cash accounting the effective inclusion of the transaction in the financial records is the date the cash or bank receipt or payment was made. The tax point date on the document is not the deciding factor to include the item in the accounts. The determining factor is the date the transaction amount was received or paid out be that in cash or bank.

There are disadvantages to maintaining accounts on a cash basis in that records must be kept of all payments received and paid out and those records supported by the actual primary accounting documents to which they relate. That entails matching the financial documents to the payments and receipts records, a feature many small businesses might find onerous.

Virtually all professional accountants adopt an accruals basis for clients accounting purposes as it is based upon recording all financial information whether relevant to the tax period or not and then adjusting the management accounting profit indicated to produce the net taxable profit or loss.

By operating an accruals basis all financial documents are recorded according to the tax point date. If all financial transactions during the year were paid for in that year then the cash basis and accruals basis would produce identical results.

The main adjustment a small business or the accountant might make to accounts prepared on the accruals basis is to first prepare the set of accounts according to the tax point of the primary accounting records and then examine those transactions and adjust them according to their relevance to the financial period for which the accounts are being prepared.

A typical example of the difference would be the rent invoice for the business premises. Let us assume a quarterly rent invoice was received dated 1 December for the 3 months from December 1 to February 28 which was paid by the small business owner by cheque on December 31 and a year end date also of December 31

On a cash basis the rent would not technically be included in the accounts as it would be shown as a rent payment from the business bank account on January 2 or later if cashed by the recipient at a later date. Therefore that quarters rent would be included in the following year accounts not the current year as issuing a cheque is not a payment but actually a promise to pay.

If the rent was paid in cash prior to the 31 December then the whole 3 months rent would be included in the current accounting records. That treatment may have distorted the accounts as more or less than 12 months rent might have been included in the tax calculations.

On an accruals basis the rent invoice would have been entered in the accounting records with an effective date of December 1. Using accrual accounting the accountant or small business owner preparing the accounts would then deduct 2 months rent as a prepayment leaving one months rent in the current year accounts.

That is more accurate as the other side of the accounting would be for that same accountant or bookkeeper to further include the 2 months rent not already claimed to be included in the tax calculation for the next financial year. That is how prepayments are treated when a business uses the accruals accounting basis.

Further when using the cash accounting basis only those transactions paid for or received are included. On an accruals basis additional expenses can be added that may not have even been invoiced yet on the basis that the costs incurred were relevant to the accounting period for which the books are being prepared.

Cash accounting might appear easier but has the disadvantage of maintaining receipts and payments records in addition to the primary documents which should also be matched to the financial transactions to support the accounts.

Accrual accounting is based upon recording all financial transactions and then adjusting the end result to determine the most accurate net taxable profit. The accruals basis is favoured by accountants as it reaches an accurate tax liability as opposed to more or less tax being payable on the cash basis according to the credit control policies and practises of the business its suppliers and clients.

Terry Cartwright, CEO DIY Accounting, a qualified accountant in the UK, designs Accounting Software on excel spreadsheets and Payroll Software for small to medium sized business providing a complete accounting solution and also supplies Company Formation packages for new limited liability companies

Business costs and expenses as expressed as a unit cost of a product can vary significantly as purchase or production volumes change. The first stage in using marginal costing to generate higher levels of profit is to identify the variability of all the individual cost elements.

Costs which are a component part of the product would normally be classified as variable costs since each component would require to be bought in specifically for that product. The cost of items bought for resale would also be classified as variable costs.

Fixed costs would be items not relating to the volume of goods manufactured or sold. Examples would be the premises costs, machinery costs.

A number of business expenses would be semi variable in that they can in some circumstances be viewed as a fixed expense but in other circumstances could also be viewed as variable expenses. Advertising expenses might be regarded as almost fixed expenses to promote the business or products whereas promoting the business name would be largely a fixed cost while specific product related advertising might be viewed as a variable product cost.

Wages and salaries are an important cost to most businesses and would normally be classified as semi variable. Administration salaries are more likely to be fixed while direct labour costs will contain both a fixed and variable element.

To operate a marginal costing program identify the variability of each cost item and evaluate that marginal cost and the fixed overheads of the business. To use the marginal costing as part of an accounting for profit program apply different volumes to the marginal costs.

At the lowest volume the fixed costs might well exceed the marginal profit, which in accounting terms is called the contribution, being the difference between the selling price and the marginal cost. The point at which the overall volume produces neither a loss nor a profit is called the break even point.

Break even analysis is important to ensure there is sufficient market demand to be able to exceed the break even point and the marketing effort will ensure that break even point is not just reached but easily achievable.

A further stage in accounting for profit would be to plan various volumes, the effect those volumes have on variable costs and occasionally on fixed costs too. Determine what is achievable and what is not achievable, the effect on the volume of profit and set business plans accordingly.

In addition to higher volumes producing higher marginal profits the variable costs also reduce when volumes increase and these changes require to be accounted for. Even if goods are being bought in purely for resale the variable costs will vary with volumes.

Buying in 100 items of a product will be cheaper than buying in 2 or 3. Selling and delivering the items individually is likely to cost more in distribution co0sts than selling in parcels of 10 or 20.

By analysing costs and their variability in relation to actual and potential volumes gives the accountant a real voice to influence management decisions in the way the business plans are constructed and by routine checks on progress using marginal costing as part of the budgeting and reporting process maximum profits can be achieved by accounting for profit.

Terry Cartwright, CEO DIY Accounting, a qualified accountant in the UK, designs Accounting Software on excel spreadsheets and Payroll Software for small to medium sized business providing a complete accounting solution and also supplies Company Formation packages for new limited liability companies

Medical billing has become one of the most cost effective ways of operating a medical practice. No matter how big or small the practice is, medical billing can reduce the amount of time and energy that is spent filling out and submitting claims forms, allowing you staff to attend to the needs of your patients and office duties. Usually, a medical practice needs to hire one person for this position and most often it is very expensive.

Submitting claims forms to insurance companies can be a tedious and frustrating task. Endless hours are spent filling out forms and sending them to the insurance company everyday. The insurance company reviews medical form and if there is an error, which happens often, it is rejected and returned to the medical provider to be redone. When this happens, the workload for the medical biller is doubled. It can be overwhelming at times.

Another factor is that insurance companies receive millions of claim forms each week. They sit in stacks on employee desks until they can be processed. This can take weeks or even months for the claim to be reviewed, and if it is denied, the whole process starts all over again. It can be maddening, especially if the medical practice is depending on the refund from the insurance company.

A medical billing company can assist a physician practice on many levels. First, the personnel are highly trained and have a working relationship with most insurance companies. They are able to get claims processed faster than a single practice. The next factor of this type of company is that they file all of your claims electronically and submit it to the insurance company computers. This means that your claims do not sit on someone’s desk for an undetermined amount of time. The claim is either accepted or rejected immediately.

The acceptance level of a medical billing company is over ninety percent, which means that your claim will be paid n a matter of days and not weeks or months. If a claim is rejected, the medical billing company will correct the error and resubmit it. They also track each payment to find where it is in process and when the payment will be sent.

This is a great benefit to small practices that depend on the insurance payments to meet weekly or monthly obligations.

Medical billing services can be used by any type of medical practice. Big or small, no matter what the specialty is, the same quality service is offered.

Doing a simple Google search for medical billing will yield you with millions of links. It is important to research the ones that you are interested in as each has their own pricing and terms of service.

Many medical practices that have made the decision to use this type of service have been impressed with the results. They have found that they have more time for their patients and their staff can perform their duties more efficiently because of the time that is saved.

Peter Geisheker is CEO of The Geisheker Group marketing firm. One of the types of
clients that Peter helps are medical billing companies

Do I have to enter mileage and vehicle running expenses in my taxi accounts.

Entering the mileage covered by the taxi is optional as the cabsmart package automatically chooses the most expensive cost which produces the lowest tax liability for cab and taxi drivers. The cabsmart taxi driver accounts package can be used by either entering your vehicle running costs or the vehicle business mileage.

Alternatively the cab driver can enter both taxi running costs and the taxi mileage in which case the cab smart formulae within the taxi accounts package automatically selects the highest cost to produce the lowest tax bill.

Would the cabsmart taxi driver accounts or the self employed accounts package be most suitable for a driving instructor.

Either accounts package would suffice but on balance the self employed accounting solution would be better as it has greater sales analysis of income not required for cab and taxi drivers. The purchase expense spreadsheet of cabsmart is specific to taxi driver expenses while the self employed package has increased analysis not required by taxi drivers whose variety of expenses tends to be more limited to vehicle running costs.

The cabsmart package is most suitable for taxi, cab, private hire drivers, van and lorry drivers to produce the accounts and complete the tax return.

The taxi fuel expenses and mileage do not appear in the profit and loss work book. The taxi expenses were not transferred from the purchase spreadsheet to the monthly profit & loss account in the financial accounts workbook.

The profit and loss account in the taxi financial accounts file is updated automatically and so if this is not happening the links are not working or there is a data entry error. A data entry error is caused if on the purchase expense spreadsheet you may have entered the taxi expense item such as fuel expenses but have not entered the code letter to analyse that expenditure using the list of letters in the user guide.

The P&L account would also not be updated if you have changed a file name.

The third potential reason is that when the cabsmart financial accounts file was downloaded you opened it first before saving and that has caused the link structure to corrupt. The simple solution is to download the taxi driver accounts templates again and save before opening and the link structure is preserved.

Taxi was sold and the sale value entered in the assets schedule but now the profit and loss account is showing a REF error message everywhere.

The REF message is an indication that a data entry error has been made. It is likely that you may not have entered the date the taxi was sold or you have not entered the written down value of the vehicle. Check those items and enter them and the REF message on the fixed assets schedule will disappear and when that goes then the REF message throughout the profit and loss account in the taxi financial accounts will also disappear.

I bought the cabsmart taxi driver accounts package several months ago but have lost it as my computer crashed. Do I need to pay again.

No problem and no need to buy again. Return to the confirmation link that was sent to you after purchase and download the taxi driver accounts package again. If you no longer have that email forward a copy of your paypal receipt and the link to the cab smart download page will be resent immediately.

What capital allowances can I claim from using my private vehicle for my taxi business.

Enter the vehicle description and cost in the fixed assets schedule in the category for vehicles less than 12,000 pounds and the capital allowance will be calculated automatically. As this is a private vehicle which is not wholly used as a cab the percentage of private vehicle use can be entered in the box provided and the capital allowance on the taxi will be adjusted accordingly.

Cars used as cabs or private hire vehicles are not subject to the first year allowance or the annual investment allowance which was introduced. Writing down capital allowances can be claimed for vehicles used as a taxi and were 25 percent of the written down value prior to 5 April 2008 and 20 percent after that date.

It is also worth pointing out that hackney cabs are in fact classed as a commercial vehicle and the first year allowance or the new annual investment allowance is claimable on those taxi vehicles. Commercial vehicles such as hackney cabs are treated for tax purposes in the same way as plant and equipment.

How do I enter a new taxi purchase in the taxi driver accounts.

Enter the total purchase price of the taxi in the expenses spreadsheet showing the date of purchase, description and total purchase cost. Use code letter F to analyse the expenditure to fixed asset.

Visit the fixed assets sheet and enter the date and description of the taxi plus the total cost. The formulae within the cabsmart taxi driver accounts package automatically calculates the capital allowances which it also places in the boxes on the tax return.

Terry Cartwright, CEO DIY Accounting, a qualified accountant in the UK, designs Accounting Software on excel spreadsheets and Payroll Software for small to medium sized business providing a complete accounting solution and also supplies Company Formation packages for new limited liability companies

Client asked for user name and authorisation code or password when attempting to download accounting software.

The client is probably attempting to login to the paypal site or has found another area on the website where a user name and password are required such as the DIY Accounting affiliate member area. The client has made an erroneous assumption of how to access the accounting or payroll software. The correct solution if the client was not returned by paypal directly to the download page is to click the URL sent in the confirmation email which was sent following the accounting software purchase.

After payment client was not returned to the website to download the product

This can happen when payment is made by credit card or the paypal sequence is interrupted in some way. All internet purchases from DIY Accounting receive a confirmation thank you note which contains a link to the download page from where the accounting or payroll software can be downloaded.

How do I download the product from the website.

Create a new accounts folder on your computer. Right click each of the links on the download page and save each accounting template directly to that folder on your computer hard drive. If the spreadsheets are opened before saving this can cause problems as the original links could be changed to temporary links.

The accounting software files do not link together.

Problems with excel spreadsheets that have been downloaded link together but may not if the structure has been inadvertently changed.

If the name of an excel workbook has been changed the links from that file to other files will be broken unless the name change is made in a specific way, that way being to open all linking workbooks so that when the new file name is changed the linking structure is preserved. It is strongly recommended that the names of the accounting workbooks are not changed, the simplest solution is to either change the file name back to the original file name provided the changed name had not been saved or download a new file with the original linked name.

If the accounting templates were opened first before saving then these files are stored on your computer with temporary links for you to view them. If that file is then subsequently saved then what is being saved is the temporary links not the original links which causes the files not to link together and the accounting software is prevented from updating the financial accounts template. The easiest solution is to delete the file and resave from the download page direct to your accounts folder without opening the files first.

None of the accounting spreadsheet templates opens.

This happens if you do not have excel installed on your computer as the accounting spreadsheets are written on excel spreadsheets and if excel is not installed your computer does not recognise the file type. Alternatively the excel spreadsheets will open if an open source spreadsheet package has been installed on the computer.

In a similar manner when the accounting templates are saved to a CD Rom the status changes from active to read only. This is because excel is not installed on the CD. The excel files automatically change back top being usable when the templates are then moved back to a computer where either excel or an open source spreadsheet package has been installed.

Having saved the accounting templates from the download page when I click the file name my computer tries to connect to the internet.

This is because the client has often not actually downloaded the accounting workbooks to their computer but instead has saved the links from the download page. As these links are linked to the source of the templates which are stored on the internet the client is returned to that source. The solution is top revisit the download page and actually download each file to your computer by clicking the link to the accounting template and then clicking save in the dialogue box.

When I open the monthly accounting template there are no tabs along the bottom of the page to navigate from one sheet to another.

This is because the client has possibly saved the links not the excel files themselves and is looking at a single accounting worksheet rather than the whole accounting workbook on the internet and not an accounting template saved on your computer. The solution is to revisit the download page and right click each link to actually save the accounting workbooks to your computer.

It is also worth pointing out that when the square box at the top right of the worksheet has been clicked to reduce the size of the spreadsheet and that spreadsheet is located further down the computer screen so the bottom part is not visible then this may also result in the navigation tabs being hidden from view. This is corrected by clicking the square box to reveal a full page view.

Terry Cartwright, DIY Accounting, a qualified accountant in the UK, designs Accounting Software on excel spreadsheets and Payroll Software for small to medium sized business providing a complete accounting solution and also supplies Company Formation packages for new limited liability companies