Why should accounting be your profession of choice?  When I made the decision it's one that never changed.  It started with taxes then lead to financial and banking support which now leads me to an even broader window of teaching and fulfillment.  Now, why should you join me and many others on this journey?

Perhaps the American Institute of Certified Public Accountants (AICPA) summarized it best in its newly issued pamphlet: "Accounting: The One Degree with 360 Degrees of Possibilities": "You may already have an idea about what you want to do for a career. Then again, maybe you're not so sure. Either way, there's one degree that gives you the education to succeed at just about anything in the business world. It's an accounting degree. Accounting opens doors in every kind of business coast to coast. It can give you the foundation you need to go on and become a CPA. It can prepare you to become a partner in an accounting firm, to pursue a career in finance or corporate management, to work in government, or even to become an entrepreneur. In fact, no matter what you decide to do, having an accounting background can open doors wide."

Accounting is a profession for those interested in math, business and who also have the skills to think outside of the box.  An accounting degree can open up many opportunities in varies industries with rewarding compensation.

USA Today has done most of the work for our young professionals by listing the "Top 10 colleges for an accounting degree".  Check it out to see if your college selection made that list.  If you're an entrepreneur seeking to strengthen this area of your business, visit our webpage for a free consultation.  We look forward to hearing from you.

The Accounting profession rules!  

Beyond the belief of many business owners who hire employees with 20+ years of experience, not all professionals are skilled to analyze data without management direction.  The skill of analytics has been identified as beyond necessary as well as critical to the compliance and financial position of an organization.  The analysis of financial data employs various techniques to emphasize the comparative and relative importance of the data presented and to evaluate the position of the firm.  These techniques include ratio analysis, common-size analysis, review of descriptive material and comparison of results with other types of data.  The information derived from these types of analysis should be blended to determine the overall financial position.  

The American Management Association research has shown that analytics are important today and will be even more important in the future."Overall, 58% of company leaders say analytics are important to their organizations now, and 82% say they will be important in five years. Less than 1% of companies say analytics will not be important to their business in five years, an unambiguous indication that analytics will be a ubiquitous part of the business world by the end of the decade."  Business owners must remember that financial statement analysis is a judgmental process.  One of the primary objectives is identification of major changes (turning points) in trends, amounts, and relationships and investigation of the reasons underlying those changes.  Often, a turning point may signal an early warning of a significant shift in the future success or failure of the business.  Knowing this, ignites the importance of establishing extensive policies and procedures for staff professional development and process improvements.  

It's a fact that absolute figures or ratios appear meaningless unless compared to other figures or ratios.  Having 60% of total assets composed of buildings and equipment would be normal for some companies but disastrous for others.  One must have a guide to determine the meaning of the ratios and other measures.  One type is trend analysis which studies the financial history of a business for comparison.  By looking at the trend of a particular ratio, one sees whether that ratio is falling, rising or remaining relatively constant.  The factors help detect problems or observe good management.  

A great example of the month to month financial comparison analysis is provided below by Illinois Small Business Development Center.

A businesses ratios are more than just numbers to your investors and banks and should mean the same to a companies professional staff.  Take the first step in improving the business culture plus the professional skills and knowledge base of staff which can lead to the prevention of costing companies millions due to preventive errors or non-compliance matters by developing an extensive reference guide tool.

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Entrepreneurs, let's consider this scenario.  Your business has expanded quicker than you expected and payroll needs to be processed in the next two business days.  As the owner and key responsible for the processing of payroll, you have been faced with a proposal deadline that you cannot miss.  What do you do without a trained back-up person?  Ideally, you will immediately contact Fontenot & Associates Solutions LLC to schedule your FREE consultation to develop an extensive procedure guide to ensure situation never occurs again.  Realistically, as the owner you going to work day and night to get both jobs done on time.

The business process should include a section related to "deductions from employee earnings" which outlines which deductions are allowed and the proper way to set those up for processing.  The total earning of an employee for a payroll period, including any overtime pay, are called gross pay.  From this amount is subtracted one or more deductions to arrive at the net pay.  The deductions normally include federal, state, local income taxes, medical insurance, and pension contributions.  A key and critical deduction employers are responsible for is income taxes.  Employers normally withheld a portion of employee earnings for payment of the employees' federal income tax.  Each employee authorizes the amount to be withheld by completing an "Employee's Withholding Allowance Certificate,"called a W-4.  This is the form every employee receives when they start a new job with an employer.  A blank form that many people may not understand completely what it means and the importance of it - especially our young college graduates and young entrepreneurs.  

A question that remains for many employees, is what do the allowances mean and how do allowances work? 

A simple answer is:  The number of allowances you claim controls how much will be withheld from your paycheck. The more you claim, the less money is withheld; the fewer, the more of your salary is sent off to the IRS. If you are a single (not married) individual with no dependents (no children) your completed W-4 form may be similar to the example below.

The completion of this worksheet shows Carlie will claim "2" exemptions, mainly because the first questions says you can claim "1" if no one else can claim you as a dependent.  This is key for college students who have their own job but the parents are still claiming them as an exemption on their tax return because they qualify.  Quick note, if your parents can still claim you on their tax return, the first question "A" should be zero.

As an employer, you may also be required to withhold state or city income taxes.  The amounts to be withheld are determined on state-by-state and city-by-city bases.  Fontenot & Associates Solutions LLC, has the knowledge and skills to develop an extensive guide for employers and their staff to ensure forms such as this are in compliance.

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As a business owner your current and future staff depends on you to process their payroll accurately and timely.  Therefore it is important for a business owner to decide if this process will be managed internally or externally by a third party.  Even if the vast majority of your payroll process in issuing 1099s, their must be a process outlined and defined.  In the world of Accounting, payroll refers to the amount paid to employees for services they provided during the period.  

A company's payroll is important for the following reasons:

1. Payroll and related payroll taxes significantly affect the net income of most companies
2. Payroll is subject to federal and state regulations
3. Good employee morale requires payroll to be paid timely and accurately   

If your still wondering why payroll is important to your business, think about the key employee liabilities that arise and come with critical deadlines.  

Just think?  Salary usually refers to payment for managerial and administrative services.  Salary is normally expressed in terms of a month or a year.  Wages usually refers to payment for employee manual labor.  The rate of wages is normally stated on an hourly or a weekly basis.  The salary or wage of an employee may be increased by bonuses, commissions, profit sharing or cost-of-living adjustments.  

To illustrate computing an employee's earnings, assume Karen Douglas is a office manager employed by Fontenot & Associates Solutions LLC.  Karen's regular rate is $55 per hour, and any hours worked in excess of 40 hours per week are paid at 1 1/2 times the regular rate.  Karen worked 45 hours for the week ended June 10.  Her earnings are as follows:

Earnings at regular rate (40 hrs. X $55)     =                            $2,200
Earnings at overtime rate [ 5 hrs X ($55 X 1 1/2)]   =               $413
Total earnings                                                                                     $2,613

We all can agree that this is one process that can be straight forward or very complex due to the many factors such as taxes, which makes the matter very serious for all employers.  Developing an extensive business guide to support the responsible professionals with monthly deadlines and compliance regulations should be a focus for this weeks goals and significant business accomplish.

Petty cash funds can be benefit to business of all sizes.  The ideal strategy would be to establish clear business goals for those responsible to ensure the account maintains the designated balance, who will have access to the funds and which expenses are deemed as applicable.  

The key accounting tips to understand is that the only time Petty Cash is debited is when fund is initially established, as shown below , or when the fund is being increased.

July 1   Petty Cash   $500
                            Cash               $500

In addition, the only time Petty Cash is credited is when the fund is being decreased for use of expenses.  The most common expenses may be postage, office supplies or minor repairs.  It's appropriate to give two persons within the company access to the petty cash account.  One person should have access to replenishing the funds as outlined in the business procedures along with the responsible journal entries. 

Accounting Scenario example:
The amount of cash in the petty cash fund is $120.  Issued a check to replenish the fund, based on the following summary of petty cash receipts:  office supplies, $300, and miscellaneous administrative expense, $75.  Any missing funds should be recorded in the cash short and over account.

Office Supplies                                                        300
Miscellaneous Administrative Expense        75
Cash Short and Over                                             5
            Cash                                                                              380

​Whether your small business is a one-person, home based business or a large corporation, Fontenot & Associates Solutions LLC can support with establishing the essential detailed policies and procedures for the accounting and operations team.  

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