Accounting For Small Businesses

image_b55ae30876cc98f4242de5eefdb36f14

What do we have in mind, when talking about big corporations in terms of governmental regulations and the use of accounting policies and practices? Of course regulations are heavier and stricter. Regulatory bodies like the Securities and Exchange Commission and Internal Revenue Service have oversight functions over corporate bodies that there is more interference on the part of the government. In some territories the SEC may even have quasi-judicial functions, resolving intra-corporate disputes and controversies.

With the passage of the Sarbanes-Oxley Act in 2002 that lead to the creation of PCAOB or the Public Company Accounting Oversight Board, accounting standards have been more stringent. Companies are now obliged to report on the efficacy of their internal control procedures in obtaining their varied objectives. They were also required to make detailed disclosures based on the generally accepted accounting principles. Because of the nature of corporations, their accounting demands also are gargantuan. In a corporate set-up, there might be a dozen of divisions, segments and business units. The challenge is how to consolidate the financial performance of these sub-entities to come up with a consolidated statement of income. Big businesses like that of corporations necessitates centralized, more structured and well-defined accounting system.

On the other hand, directly opposite these mammoth corporations are small business, with capital ranging from a few hundred bucks to not more than 50,000 dollars, and usually taking the form sole proprietorship. These businesses usually are owned by a single individual or few individuals without really formalizing their agreement to form a legal partnership. As such, the capital is mainly coming from the owner. The proprietor also normally does multi-tasking, wearing different hats at the same time. Because the business is small, the demands are also small, regulation and accounting wise. They are not the usual subject of scrutiny of governmental watchdogs. Of course the lean size of the business should not undermine the accuracy and completeness of accounting records. This matter transcends to all business entities regardless of the size. As a matter of fact, while the business is small, things must be set right and proper so it would be much easy to expand in the future.

Cost cutting is usually the strategy of small business. Sometimes, these measures would even impair the need of an accounting system that generates records and transactions. Owners of small business may have the tendency of not focusing on accounting concerns because it does not produce direct results on business. However, many good managers and finance people would recommend that a system, whether manual, or automated or a transition of both must be put in place.

Manual accounting is a form of accounting system that does not use accounting software or uses software but does not automatically process transactions. This is usually found in small businesses that maintain the physical book of accounts like journals and ledgers. All or almost all of the steps in the entire accounting cycle are done with lay hands. Starting from entering transactions in journal, summarizing them by posting in the ledger, preparation of trial balance, adjusting entries, up to the generation of financial statements and supporting notes; all these are manually done. These companies have accounting system, only, it’s manual. The main reason why companies still embrace manual accounting system is obviously pecuniary in nature. The company might still be in the start-up stage or perhaps it has small number of transactions and these transactions are just routinary. Although of course, this cuts cost, the main criticism that could be leveled against this set-up is it requires a lot of dirty work and space for maintenance of physical documents and records. As much as some companies would like to have a fully automated accounting system, their resources would not permit. In the process, they resort to a manual one.

Acquiring integrated systems through Enterprise Resource Planning (ERP) producing a totally paperless environment would prove untenable also for small business. A paperless environment, where transactions are automatically initiated, entries automatically generated and master files are automatically updated is an attribute of a fully automated accounting system. Reports are also generated with little or no human intervention at all. Moreover, these reports could be customized based on the specific need of the user. This would entail tremendous volume of resources, however. For purposes of economy, small businesses usually settle for an interface or commingling of both manual and fully automated systems, meeting half-way as they say. Although data are still inputted manually from source, productivity tools are employed to make the whole process faster and more efficient. Say, the system has the capacity to group together similar accounts into one. Instead of manually calculating the balance of say, Cash account, the system does the automatic posting for you. From raw transactions in a period, trial balances can be made available, so as with the financial statements to wit, Balance Sheet, Income Statement, Cash Flows and Changes in Equity. This capacity is way below fully automated systems but is more efficient compared to manual accounting.

To conclude, the business has to make a rather important choice whether to adopt an automated or settle to manual accounting system. It has to make an honest review of itself and check its capacity to shift. At the end of the day, what is more important boils back to the accuracy, reliability and completeness of accounting records and reports.

Mark is a financial writer, small business owner, and owner of a Canadian business for sale website. Visit the site today if you are looking to buy a business for sale Calgary, or in toronto.


Matching School Ads
  • Online degrees offered include BA in Accounting, BA in Business Administration, MBA, and more.
  • Business students may be eligible for scholarships such as the Entrepreneurship Scholarship.
  • Courses help students develop knowledge of marketing, accounting, economic principles, and financial management.
  • Business Administration students can specialize in areas such as Entrepreneurship, Finance, and Project Management.

Programs:

  • BA/Accounting
  • BA/Consumer and Family Financial Services
  • BA/Finance
  • And more...
  • Ranked among the Best Online Bachelor’s Programs by U.S. News and World Report in 2015.
  • Ranked among the Best Online MBA Programs by U.S. News and World Report in 2015.
  • Founded in 1890, it has a campus in Waterbury, CT and offers online degree program in eight-week modules, six times a year.
  • About 800 students are enrolled at the main campus, and about half of them commute.
  • Online courses make it possible for students to earn a bachelor’s degree in as little as 18 months and a master’s degree in 14-24 months.

Programs:

  • B.S. in Accounting
  • B.S. in Business Administration / Accounting
  • B.S. in Finance
  • And more...
  • Earn Your Bachelor's Degree in Business with GCU's Colangelo College of Business!
  • Emphases: Accounting, Applied Mgmt, Business Admin, Business Mgmt, Finance and Economics, Marketing & more.
  • Develop and refine skills in core areas such as economics, accounting, marketing, statistics, org. behavior, and legal and ethical issues.
  • Serving undergraduates who are preparing to initiate careers & working professionals who are seeking to develop their careers further.
  • Accredited by the Accreditation Council for Business Schools & Programs (ACBSP).

Programs:

  • B.S. in Accounting
  • B.S. in Finance and Economics
  • Our top-ranking program blends modern business theory with real-world experience
  • Institutionally accredited by SACSCOC with ACBSP graduate business program accreditation
  • High-quality, Christ-centered education with online and select on-campus & evening courses
  • Qualifying bachelor's students can transfer up to 90 credit hours into their degree program
  • 86% of Regent students receive some form of financial aid

Programs:

  • Bachelor of Science in Accounting
  • Bachelor of Science in Business - Accounting
  • Degrees offered include Bachelor of Science in Accounting, Bachelor of Science in Business Administration, and Master of Business Administration.
  • Students are instructed in relevant business skills like communication, mathematics, and management.
  • Coursework emphasizes the development of project management, communication, decision-making, and problem-solving skills.
  • Flexible, 100% online and campus based programs available.

Programs:

  • BS in Accounting - Public Accountancy
  • BS in Accounting
  • BS in Accounting - Managerial Accountancy
  • And more...

You’re serious about success. With your busy schedule and the desire to move your career forward, you can earn an accredited associate, bachelors or master’s degree at a pace that works for you anywhere, anytime, 24/7.

At AIU, the Serious U, you can get started to get ahead.

Programs:

  • Bachelor of Accounting
  • Bachelor's (BBA) - Accounting
  • Bachelor's (BBA) - Finance

CTU Classes Are As Close As The Mobile App.
Take classes with the help of your smartphone, tablet or laptop. CTU’s online bachelor’s programs were ranked among the Best Online Bachelor’s Programs by U.S. News & World Report.

Programs:

  • Bachelor of Science in Accounting
  • Bachelor of Science in Business Administration - Finance

100% Online & No Standardized Testing

We are committed to helping you achieve your goals and complete your degree as quickly as possible.

Programs:

  • BS in Business - Finance
Get the hands-on training and skills it takes to succeed with Ashworth College, a respected, worldwide leader in distance education. Study at the times and places most convenient for you.

Programs:

  • Payroll Clerk
  • Find Online Schools. 100% Online Accredited Courses
  • Get Matched to Programs In A Few Clicks!
  • Earn an Affordable Degree from Home at your own pace
  • Get College info today. Its Free and Easy!

Programs:



Matching School Ads
  • Fortis offers nursing programs including ADN, PN, BSN degrees, and more
  • 40+ schools in 15 states including Florida, Arizona, Ohio, and Virginia
  • All colleges are accredited by ABHES, ACCSC, ACICS, or other accrediting bodies
  • Fortis Online serves benefits to US military service members
  • Grants & scholarship aid may be available for qualifying students

Programs:

  • Registered Nurse to Bachelor of Science in Nursing
  • Associate Degree in Nursing
  • Practical Nursing
  • And more...
Locations:  Grand Prairie

Designed with the needs of working adult students in mind, South University, Online Programs is built on the similar curriculum offered at South University's campus locations. As a student at South University, Online Programs you will receive the same quality instruction, variety of learning options and level of service found at the campus locations.

Programs:

  • Nursing (RN to BSN)
  • RNs, ready to take your nursing career to the next level? Earn your BSN online with GCU.
  • The baccalaureate degree in nursing and master's degree in nursing at GCU are accredited by the Commission on Collegiate Nursing Education
  • GCU's courses are taught by practicing nurses and experts who share knowledge and experience in areas of clinical patient care, healthcare management and professional nursing practice and leadership.
  • Gain a comprehensive view of patient care principles to strengthen your ability to care for patients and take on hospital responsibilities with your BSN.
  • Focus on family-centered healthcare, health history and physical examinations, applied health care statistics, nursing leadership and development and more.

Programs:

  • B.S. in Nursing (Registered Nurse - R.N. to B.S.N)

Making the decision to earn your degree and pursue your career goals could be the best decision you ever make. Enroll at ECPI University and you’ll join a collaborative and fostering learning environment, surrounded by faculty and staff who are there to support you through the entire process.


What sets ECPI University apart? Just ask the employers who hire our graduates. Since 1966, more than 3,800 employers have looked to ECPI for talented professionals who are capable of entering the workplace and doing the job right on the very first day. That’s because our curriculum is designed to meet the needs of today’s highly-specialized job market.

 

What Are You Waiting For?

Programs:

  • Practical Nursing - Diploma
Locations:  Manassas

CTU Classes Are As Close As The Mobile App.
Take classes with the help of your smartphone, tablet or laptop. CTU’s online bachelor’s programs were ranked among the Best Online Bachelor’s Programs by U.S. News & World Report.

Programs:

  • Bachelor of Science in Nursing (RN to BSN completion)

100% Online & No Standardized Testing

We are committed to helping you achieve your goals and complete your degree as quickly as possible.

Programs:

  • BS in Nursing (RN to BSN)

Regent University prepares students with the knowledge to excel and the faith to live with purpose. Our 20,000 alumni, from more than 110 countries, are changing the world as accomplished professionals. Named a top-15 school nationally for online bachelor's programs (U.S. News & World Report, 2015), Regent is among the most affordable undergraduate Christian colleges (CCCU 2015). Fully accredited, challenging programs are available online and on campus. New classes begin every eight weeks.

Programs:

  • Bachelor of Science in Nursing (RN to BSN)
  • Find Online Schools. 100% Online Accredited Courses
  • Get Matched to Programs In A Few Clicks!
  • Earn an Affordable Degree from Home at your own pace
  • Get College info today. Its Free and Easy!

Programs:

  • Interested in Helping Others? Get Educated in the Nursing Field
  • Build the Capabilities and Connections to Power Your Future
  • Nursing, RN to BSN, LVN/LPN Degree Programs and More From Top Colleges that Fit Your Needs
  • Find Schools Online or Near You & Get Info for FREE Today!

Programs: