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Why Intuit QuickBooks Online is the Perfect Fit for Your Finances

Welcome back! Today, we’re here to let you in on one of the best digital accountants out there. If you have been reading our monthly blogs, we often mention Quickbooks Online. That’s because as a trusted accounting firm, we at Moose Creek Bookkeeping have seen our fair share of financial tools and platforms, and we’re excited to share why it has been at the top of our list for years.

It’s All About Accessibility

One of the primary reasons QuickBooks Online is our top pick is because it’s cloud-based. Gone are the days of being chained to your desktop computer. You can now access your financial data from anywhere with an internet connection! So, whether you’re sipping cocktails on a beach or crunching numbers in your pajamas, your finances are always available.

Easy to Use and Collaborate

QuickBooks Online makes accounting easy, even for those who don’t consider themselves financial wizards. With its user-friendly interface and intuitive design, you don’t need an advanced degree in accounting to navigate your way around. Plus, it offers step-by-step guidance and allows for multiple users.

Real-time Insights

Imagine having a crystal ball that shows you the future of your business finances. QuickBooks Online offers real-time financial insights that let you stay on top of your income, expenses, profits and payroll. You can monitor your cash flow, track your expenses, and make informed decisions to keep your business thriving.

Automate Tedious Tasks

Nobody likes data entry and manual bookkeeping, right? QuickBooks Online automates many of these repetitive tasks. It can connect to your bank accounts and credit cards, categorize transactions, and even generate financial reports with just a few clicks. More time for you, less time for paperwork!

Stay Compliant with Ease

QuickBooks Online helps you stay compliant by tracking expenses, generating tax reports, and even assisting with tax deductions. Pair it with our expertise at Moose Creek Bookkeeping, and then come tax time, you’ll be armed with the information you need to file accurately and efficiently.

Top-notch Security

In today’s digital age, security is paramount. QuickBooks Online has robust security measures in place to protect your financial data. The trusted brand of Intuit also owns TurboTax and MailChimp creating a massive and secure online presence.

In a nutshell, QuickBooks Online is like having Moose Creek Bookkeeping at your disposal 24/7. It’s efficient, user-friendly, affordable, and incredibly powerful. Whether you’re a seasoned business owner or just starting out, this software has something for everyone. Ready to take the plunge into the world of stress-free accounting? We are here to answer any questions you may have or to discuss how Quickbooks Online can improve your overall financial vision. Please give us a call or schedule a discovery call today.

Lurking in the Shadows: Understanding and Preventing Expense Fraud

Hey there, financial warriors and business owners! Let’s dive into a topic that’s as sly as a fox in the accounting world – expense fraud. In this article, we’re setting out on a journey to uncover the layers of expense fraud, its varied forms, preventive measures, and how Moose Creek Bookkeeping can play the hero and catch those sneaky culprits, even when long-term projects with many players are involved.

Different Ways Expense Fraud Makes itself known:

Inflated Expenses: Dishonest employees inflate legitimate expenses to secure larger reimbursements than they are genuinely owed. Claiming that a $15 cab ride was a $100 limo ride, for example.

Fictitious Expenses: False expenses are fabricated out of thin air, and these fabricated claims are then submitted for reimbursement. Typically lacking a receipt.

Duplicate Expenses: Either by accident or in an attempt to game the system, the same expense is submitted multiple times, resulting in additional reimbursements.

Personal Expenses Camouflaged as Business Costs: Mixing personal expenses with legitimate business expenses, attempting to slip these personal costs through the approval process.

Mischaracterized Expenses: Employees mislabel expenses, making them seem like valid business costs when they are not.

All of the examples above can put your business in hot water with the IRS in the event of the dreaded audit, and businesses that have more suspicious behavior are more likely to be audited. Let’s talk about how Moose Creek Bookkeeping can keep your business in the clear when it comes to Expense Fraud. Remember, the larger the project, the more opportunity for fraud to occur so as your business grows, it becomes more and more important to seek professional guidance when it comes to accounting. Moose Creek Bookkeeping will help reconcile and prevent any past or future fraud. Here’s how we accomplish that:

Airtight Expense Policies: Develop clear and comprehensive expense policies that leave no room for ambiguity. Employees must have a solid understanding of what qualifies as a legitimate business expense.

Mandatory Receipts: Implement a strict receipt submission policy for every expense claim. No receipt, No reimbursement. Period.

Rigorous Audits: Conduct regular (and surprise) audits of expense reports to detect any red flags.

Managerial Scrutiny: Institute a two-tier review system where both the employee and their manager review and approve the expenses.

Automation for Accuracy: Leverage digital detectives in the form of software to automatically flag unusual patterns.

Training and Education: Continually educate your employees about the expense policy, its significance, and the potential consequences of fraudulent activities. Awareness is key.

Whistleblower Channels: Establish a confidential channel for employees to report suspicious activities without fear of retaliation.

As you can see, expense fraud is an adversary that can jeopardize a business’s financial stability and reputation. However, armed with knowledge, vigilance, and the right tools, businesses can take decisive steps to prevent and detect fraud. Collaborating with experts like Moose Creek Bookkeeping ensures that even in the murky landscape of contractors and large-scale projects, financial transparency remains paramount. Remember, the path to a fraud-resistant future begins with a commitment to honesty, awareness, and RECEIPTS!

Please give us a call to schedule a free discovery call.

Greetings! Today we’ll be talking about two of the most popular accounting methods: cash basis and accrual basis. Many business owners scratch their heads when trying to decide which method will work best for their business, and how they should set up their accounting software, like Quickbooks Online. At Moose Creek Bookkeeping, we are well-versed in all things accounting and we are happy to share our knowledge with you. Let’s dig into cash basis vs. accrual basis.

Cash Basis Accounting:

Imagine you run a small bakery, and you sell a batch of delicious cupcakes today. With cash basis accounting, you’d record the sale when your customer pays you, and not a moment before. It’s a simple approach that focuses on actual cash inflows and outflows. Perfect for businesses with straightforward, day-to-day transactions, this method is like keeping a close eye on your wallet.

The pros of this method include the simplicity of it as well as the real-time picture it provides. You get a clear view of your actual cash flow, which helps you manage short-term financial needs effectively.

Conversely, as comfortable as cash basis accounting might feel, it doesn’t give you the whole financial story.

And for long-term projects, cash basis accounting might not reflect the project’s real financial status, making it a bit like trying to bake those cupcakes with missing ingredients.

Now, let’s talk about accrual basis accounting. This method goes beyond cold, hard cash and considers transactions when they are earned, regardless of cash movements. It’s like having a crystal ball that predicts your financial future.

Accrual accounting provides a complete and accurate snapshot of your business’s financial health. It accounts for both present and future income and expenses, offering you a well-rounded picture. For long-term projects, accrual basis accounting is a shining star. It helps you track revenue and expenses over time, giving you valuable insights into your project’s profitability and financial performance.

However, accrual basis accounting might feel a little intimidating, as it requires a bit more accounting know-how and organization. Oddly, with accrual accounting, In the short term, your cash flow might not line up with your reported income or expenses. This can be a tad tricky to manage but remember, understanding the difference is key.

That’s where we come in. Moose Creek Bookkeeping has been helping businesses just like yours understand and master these principles. Our holistic approach and long-term insights will guide you to make sweet financial decisions and keep your projects on a path to success.

Reach out to Moose Creek Bookkeeping at any time for a no-obligation discovery call.

Hey there, contractors and project enthusiasts! Welcome to Moose Creek Bookkeeping, where we believe that understanding the financial side of your contracting business can take your success to new heights. Today, we’re diving into two crucial concepts in bookkeeping: Accounts Receivable Aging and Accounts Payable Aging. So, let’s grab our hard hats and discover why these two reports are so vital.

Accounts Receivable Aging is a process that helps businesses keep track of the payments they are owed by their customers. In simple terms, it provides a snapshot of how long invoices have been outstanding and the likelihood of collecting those funds. Accounts Receivable Aging allows you to track the timing and status of each invoice, helping you anticipate and manage your cash flow effectively. By understanding which payments are due, overdue, or outstanding, you can take proactive steps to collect what you’re owed.

In the contracting world, relationships matter! With Accounts Receivable Aging, you can identify clients who consistently pay on time, allowing you to nurture those valuable relationships. For clients who may have fallen behind on payments, you can employ friendly reminders and open communication to ensure they stay on track. By maintaining positive client relationships, you set the stage for future projects and excellent referrals. Using these reports you can quickly identify any delays or potential issues, enabling you to take proactive measures to address them, such as adjusting deadlines.

Now, let’s look at the other side of the equation. As a contractor, you rely on a network of suppliers and subcontractors to bring your projects to life. Accounts Payable Aging is the secret sauce to maintaining strong partnerships and keeping your projects running smoothly. Just like you, they like to be paid on time, so you can see why these two concepts go hand-in-hand.

Accounts Payable Aging allows you to track your outstanding invoices, ensuring you never miss a payment. Paying your suppliers promptly builds trust, strengthens relationships, and ensures a steady supply of materials and services when you need them most. By managing and categorizing your payables, you can easily track project-related expenses, and even identify any billing errors or discrepancies.

We understand that chasing down outstanding payments might not be your thing, so we can do that for you! We offer comprehensive bookkeeping services tailored to your needs, including meticulous management of Accounts Receivable Aging and Accounts Payable Aging. With our assistance, you can focus on what you do best—bringing your projects to life—while we handle the financial details with precision.

Moose Creek Bookkeeping is here to be your trusted ally, offering expert bookkeeping services and guidance for businesses of all shapes and sizes. Please give us a call or schedule a discovery call so we talk about how Moose Creek Bookkeeping can help your business thrive financially.

Percentage-of-Completion Method vs. Completed-Contract Method

Accounting for long-term projects can be complex, requiring careful consideration of income and expense recognition. In this month’s blog, we will cover the two common accounting practices used by contractors and the like for large, long-term projects: Percentage-of-Completion Method and the Completed-Contract Method. We understand you might already be scratching your head regarding what those two methods accomplish or what those words even mean, well you’re in luck! Moose Creek Bookkeeping has been guiding businesses just like yours through the complex calculations required to keep your financials accurate and easy to grasp. Let’s take a quick look at the differences between the Percentage-of-Completion Method and the Completed-Contract Method.

The difference between the two methods lies in the timing of income and expense recognition.

Percentage-of-Completion Method:

• This method accurately represents a project’s financial performance by recognizing income and expenses as a percentage as the project progresses.
• Aligns with the matching principle, ensuring that income and expenses are appropriately reconciled in each reporting period.
• Contractors using this method can provide stakeholders with regular updates on the project’s progress.

Completed-Contract Method:

• This method defers the recognition of income and expenses until the project is completed.
• It is more simple which can save time and effort in estimating and tracking completion percentages.
• There is no need for ongoing estimation or tracking of project progress. This reduces the risk of inaccuracies.
• With income and expenses recognized in a single period, the Completed-Contract method can provide financial statements with less volatility (no estimates).

Basically, the Percentage-of-Completion method provides ongoing information about the project’s financial performance throughout its duration. In contrast, the Completed-Contract method provides a more static snapshot of the project’s financials at the time of completion.

While both the Percentage-of-Completion and Completed-Contract methods have their merits, the Percentage-of-Completion method is generally considered better for contractors. It provides accurate income recognition and aligns with industry standards. However, there are a host of variables that can determine which method is right for your business. We are happy to discuss those variables with you in further detail.

Hopefully, this gave you some insight into which method might work best for your company. Please reach out to Moose Creek Bookkeeping with any questions you may have. We always offer a complimentary discovery session to help point you in the right direction.

As a business owner or manager, it’s essential to stay on top of your company’s financial health. Wouldn’t it be great if there was one report that could give you a high-level overview of the books so you can make smart financial decisions for the future? Well, there is! We present The Balance Sheet. (ta-da!)

While it’s not a novel idea, a balance sheet is one of the reports that are crucial to understanding. At Moose Creek Bookkeeping we have been translating accounting reports for clients for over 30 years, combined. So, if you still have questions after reading this quick article, please reach out for a free discovery call.

Balance sheets give you a clear picture of your business’s financial position at a chosen time in the past. They can help you make smart decisions about future investments, loans, or other financial activities. It can also tell you if you have enough cash on hand to meet your obligations, or if your interest rates are too high to maintain.

A balance sheet is typically divided into three sections:

Assets are what your company owns, including cash, inventory, equipment, and property. This information is helpful in assessing your company’s liquidity, as well as its ability to invest in new projects.

Liabilities are what your company owes to others, including loans, accounts payable, and taxes. This information is vital in understanding your company’s debt levels and interest rates.

Equity represents the leftover interest in the assets of your company after deducting liabilities. This information is important if you plan to attract investors.

Reading a balance sheet may seem intimidating at first, but it’s not as complicated as it looks. Here are the steps to follow:

1. Look at the assets section: You’ll see categories like cash, accounts receivable, inventory, and property. Add up all the assets to get your total.

1. Look at the liabilities section: This section lists everything your company owes, like loans and accounts payable. Add up all the Liabilities.

1. Look at the equity section: This section lists how much money you and any other investors have put into the company. Add it up!

Check the equation: The balance sheet equation is assets = liabilities + equity. By nature, a balance sheet should always balance. If it doesn’t, it’s likely due to missing or incorrect data. Don’t worry! This is common for many of our new clients; we are able to help right your ship.

Your company’s accounting software should make running a balance sheet report a breeze. If you need further help to understand your reports, Moose Creek Bookkeeping is here to help. We take pride in what we do and our clients benefit from it. Reach out today with any questions you might have.

Understanding Your P&L Statement

Today, we’d like to discuss how Moose Creek Bookkeeping services can help your business achieve financial understanding in 2023 and beyond. Every business owner knows how important it is to stay on top of the financials – but two important factors often get in the way of accurate bookkeeping: organization and understanding. In our previous blog posts, we talked about how Moose Creek Bookkeeping can help you maintain organization regarding paperwork, receipts, etc. Now, let’s talk about understanding the most crucial report your accounting software* can generate: Profit & Loss Statement (Aka P&L or Income Statement).

Your P&L statement is a financial report that shows your business’s revenue, costs, expenses, and profit. This information is incredibly valuable – it can help you identify areas where you can cut costs and improve your profitability. Without this information, it’s easy to make uninformed decisions that negatively impact your bottom line.

Let’s break it down. Simply speaking, your P&L is calculated as  Income – Expenses = Profit. Depending on the nature of your business, this can be relatively basic, or mind-numbingly complex, and that’s why we are here to help.

Here are the basic categories you will see on a P&L

Revenue: Revenue also called the “top line” of the P&L, is the money that you’re bringing in from your sales.

Cost of Goods Sold: These are the costs that you incur when you make your products or deliver your services.

Gross margin: Gross margin tells you how much money you have left over to cover your expenses after you’ve covered the cost of the product or service you are selling.

Operating expenses: Operating expenses cover all of the expenses that you incur to keep your doors open, excluding your direct costs of goods as above.

Net profit: This is your “bottom line” that you hear so much about. You started with your revenue as your “top line” and then subtracted things as you went: direct costs, operating expenses, and so on. What’s leftover is your profit, or potentially your loss if you ended up spending more than you earned.

Now, your company might fall somewhere between the basic and the mind-numbingly complex when it comes to P&L reports, but either way, we have you covered. Most of our clients are not massive companies with CFOs and Shareholders to scrutinize the books, so we are here to take the deep dive that so many companies are missing out on. Let Moose Creek Bookkeeping guide you through the complexities of financial reports, identify potential issues and offer solutions to improve your business’s current and future financial health. Please give us a call or schedule a free discovery call.

*If you’re reading this and you currently do not utilize accounting software, please reach out so we can discuss some of our recommended platforms for your unique business.