An all too common scenario that business owners have in their business, is they hire in Edmonton bookkeeping company does not have a solid background in bookkeeping. They discovered too late, that the bookkeeping was a mess, it is not organized, transactions were not recorded properly, and when they send all their information to their accountant to work on their corporate year-end, accountant discovered that everything was a complete mess and they have to spend time redoing the entire year’s financials. Not only does that mean entrepreneurs had to pay for that bookkeeping service, but then they have had to pay their accountant to redo the bookkeeping, but at the accountant’s rate, and in a hurry because they also need to do their corporate year-end. This narrow can be avoided, if entrepreneurs understand how important the bookkeeping is in their business, and be aware of how to hire the right bookkeeping company for their business, to avoid scenarios like this one.
One of the first things that entrepreneurs need to understand when it comes to hiring Edmonton bookkeeping company, is that anyone can call themselves a bookkeeper. The reason for this is because there is no professional designation or governing body. Therefore, anyone who has some knowledge can call themselves a bookkeeper whether they should or not. Business owners need to be extremely prudent and aware of what questions they need to ask and what they need to look for when they are hiring the right bookkeeper for their business to end up with someone who will keep them organized so that they can have the most organized books possible. They will need to hire a bookkeeper who has knowledge of accrual accounting. This is extremely important because accrual accounting is when an entrepreneur provides a service or product and then gets paid at a later date. The reason why this is important to have knowledge in is that there is a higher chance of errors because of the difference when the invoice is created and when the payment comes in.
Other terms that are related to accrual accounting that Edmonton bookkeeping company that they hire needs to know, are what are Accounts Receivable and accounts payable. Accounts payable is referring to the amount of money that the entrepreneur owes. They received a product or service, and they have not paid for it. Yet Accounts Receivable is the exact opposite, it is the amount of money that is the owner is owed. They have provided the product or service but have not gotten paid for the job yet. It is extremely important that they hire an Edmonton bookkeeping company that is familiar with this because it is difficult to keep straight without prior experience.
When an entrepreneur knows what the Edmonton bookkeeping company needs to know, they will be better repaired to hire them in their business, and being certain that they are going to be able to provide the service they are expecting, and need to grow their business.
It is extremely important that entrepreneurs hire the best Edmonton bookkeeping company for their business, because they will work in conjunction with their accountant, and help keep an entrepreneur organize financially, not only at the end of the best year-end financial statements but so that they can have great interim financial statements on a regular basis so that they can make informed financial decisions throughout the year in their business. In order to ensure that they have great interim financial statements, and bookkeeper needs to be organized, and do their job very well. They need to ensure that the bookkeeper that they hire is not only knowledgeable and experienced but ideally that they have experienced either working in an accountant office, working for an accountant, so that they know what types of information are going to be expected of them. Since literally anyone can call themselves a bookkeeper, looking for one for the right experience in the vital to the entrepreneur getting the best financial statements possible.
It is also very important that in Edmonton bookkeeping company understand very much what a shareholder loan account is. Entrepreneurs should also know that the shareholder loan account is referring to all of the transactions that a business owner owns their corporation, or that their corporation owes them. If an entrepreneur pays Bill personally, then their corporation owes them that money back. However, if they take money out of their business, or pay for personal expenses using company money, they owe their corporation back. The reason why this is important to keep straight is that all of the money that on nor takes out of their business for personal use is taxed at the personal tax rate which is actually 48% at the highest in Alberta. However, the corporate tax rate in Alberta is 11%. Entrepreneurs have transactions that are coded as personal actually business, business owners are actually paying up to 37% more taxes and those transactions are coded incorrectly. When hiring Edmonton bookkeeping company, entrepreneurs need to ensure that they know what ensure there loan account is, so they can avoid paying significant taxes.
Business owners should also know that they need to hire an Edmonton bookkeeping company that understands what receipts they need to keep. While business owners need to keep a record of every single received Canada revenue agency case they get audited, their bookkeeper also needs to understand that they do not need to keep the originals, that they can keep scans of everything. Generally, Edmonton bookkeeping companies will need to keep track of all the transactions over a hundred dollars, and that they do not need the original receipts.
By knowing all of the various duties that a bookkeeper needs to know, and how to hire the best Edmonton bookkeeping company for their business, entrepreneurs can ensure that they are hiring the best professional that they can, so that they can end up with the best financial statements possible to help keep them organized and make best financial decisions in their business.