Better Accounting and Financial Reporting Prompts Factoring

It is particularly important for small businesses to get into the habit of facilitating accurate, timely and meaningful financial reports.  These are important for the following reasons:

1.       Allows you to analyze and assess your company’s performance – both past and current.

2.       Helps in the understanding, monitoring and controlling of costs.

3.       This fulfills your bank and other third party requirements, including preparation for taxes.

4.       Sets your financial targets for next quarter and help with projections for the following next year.

5.       Monthly financial reporting should include

6.       Balance Sheet

7.       Income Statement

8.       Statement of Cash Flows

9.       Alerts you as to the need to implement factoring services to help pay bills.

10.     Provides you the small business owner with peace of mind.

Many small business owners stress because their invoices have not been paid on time.  Some have 30 day invoices that are running at 60 and even 90 days out, thanks to the recession.  But the one tactic mentioned above that can alleviate stress if the funds just aren’t there this month to pay your bills, is invoice factoring.  Also known as accounts receivable factoring,  small businesses everywhere globally are finding out that it is one of finances best kept secret.

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Source: Interface Financial Group

Disasters Prompt Need for Construction Factoring

Historically, natural disasters like the devastating earthquake and Tsunami that just happened  in Japan can cause unprecedented damage to a country's infrastructure, tremendously affecting business continuity, both in that country and abroad. For many companies, disaster recovery aid, and the funding for it, has become part of business planning. Many companies execute plans for relocation, or the outsourcing of crucial business functions during a crisis.

ACD Financial Services offers support to small businesses suffering from the consequences of natural disasters.   In fact often times construction factoring can be an essential  source and financial resource to benefit the many construction contracts underpinning rebuilding efforts needed during and after disasters. The construction industry is one of several sectors that can benefit tremendously from invoice factoring.

For example, a construction company could factor current outstanding invoices and would  not have to wait for payment before starting construction on a new project. Sub-contractors or construction firms can realize quick turnaround (often within 24 hours) on accounts receivable due, to staff up quickly, buy needed supplies and be off to help aid an ailing country.

Factoring offers an excellent source of cash flow by selling these invoices to a factoring company. With invoice factoring , there are no minimums, no maximums, no long-term commitments and no lengthy application process.

That's right, immediate working capital is available now.

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Source: Interface Financial Group 

 

Jobless Rate Falls to 8.9 Percent

Good news in the United States job market - for the first time in two years the unemployment rate in the U.S. has fallen below 9 per cent. Employers in the U.S. have hired 192,000 more workersno9n farm workers) as of February, and the U.S. unemployment rate has finally gone down to 8.9 percent.  Actually, according to the Labor Department, the unemployment rate fell for the third straight month in a row.

The unemployment rate in January was at 9.0 percent in January. Economists forecast the unemployment rate to rise to 9.1 percent. Job growth in December and January was revised higher by 58,000 jobs. Average hourly earnings held steady at $22.87. Earnings are up 1.7 percent in the past year.

 

Small Businesses Ramp Up: Many Use Factoring Companies to Secure Growth

It appears as if small businesses in the United States (firms with fewer than 50 employees) are finally ramping up hiring. Experts believe this is because of  more optimism among  as well as economic recovery, although the unemployment rate is still at nine percent.

Whereas a year ago at this time we were  losing thousands of job monthly, ADP data reported 100,000 jobs in February. There were 101,000 in January, and December as well. ADP is a payroll processor that reported the data on March 4th.

Small businesses defined as firms with fewer than 50 employees, started hiring in January 2010 and have been adding jobs consecutively for the last 12 months, according to ADP, which released its most recent report on Wednesday.

46 percent of the 217,000 jobs were added by small businesses last month -- most of which are labor and/or service-intensive.  These small businesses need cash to sustain, and to hire employees, pay their bills and continue to grow, so one tactic that we are seeing is more businesses using invoice factoring.  Factoring companies have seen an increase in new small business customers, in addition to those why discovered factoring long ago -- many of which use it as a business strategy.

 

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Small Business Tax Tips - Five Ways to Pay Less Tax

1.     File your income tax return on time or obtain a filing extension.  If you don't, you risk interest and penalties for late filing. You also lose the opportunity to make certain tax choices required on a return filed on time.

2.     Use retirement plans not only to save for your retirement needs, but also to reduce current taxes.  If you have not yet set up a retirement plan, consider a Keogh, SEP, or SIMPLE plan to put more away on a tax-deductible basis than you can under an IRA. Contact a financial advisor to set up a retirement plan.

3.      Keep good books and records for your business.  Keep these records separate from records of your personal expenses.  Keep good records to track both small and large expenses; small expenses can add up to significant expenses.  Keep these business records as long as necessary.  Generally, this is at least three years after the date you filed your income tax return.  In some cases, however, it's a good idea to keep records even longer.

4.     Keep records to substantiate your travel and entertainment expenses.  While you don't have to keep receipts for expenses (other than lodging) of $75 or less, you must still note in a log or diary the business purpose for the expense, the date it was incurred, and the amount you spent.

5.     Make sure to run a part-time business in a business-like manner, in case it incurs a loss. By keeping records of your part-time business, you'll be able to prove a profit motive and deduct the loss of the business from your taxes.  Keep separate books, records, and business bank accounts and change business operations with an eye toward making a profit.

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Reference: ACCION USA