F! - Financial Accounting
One of two financial processes that prepares financial statements for decision makers, stockholders, suppliers, banks, employees, government agencies, owners, and other stakeholders. It is also used to prepare accounting information for people outside the organization or not involved in the day to day running of the company. It is a trailing indicator or metric of past performance.
Start with the Financial Institutions and Support Systems. There is no real order to the following because the decision could change on bank, accountant, software etc., based on the requirements of each.
Your primary external concern is meeting federal, state, and local tax laws. This includes ensuring you have a business license, EIN for the business.e reporting business income personally consider some form of business incorporation. recent changes in US tax law now makes incorporation a smart move. Check with your accountant to determine the best choice for you.
Create an SOP (Standard Operating Procedure) for the following business operations: Accounts Payable, Accounts Receivable, Purchasing, Payroll, Petty Cash, Property Management, Inventory, and Collections. As the company grows you will expand this list of SOP's to cover additional financial demands.
Not on the list but something to consider. What reports do you need on a monthly basis, when do you want to review it, and who will attend the meeting. My recommendation is as quickly as possible after the end of the month. This must include a minimum of 3 reports Balance Sheet, Profit and Loss, and Sources and Uses of Cash.
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