5 Tips for Maintaining Your 2020 Business Budget

As the first month of the new decade reaches its end, it’s time to analyze how well you’ve been sticking to those New Year’s resolutions. How well have you been adhering to the budget you created for the year? It’s easy to get off track when life can be so unpredictable at times. Here are some great tips for maintaining your 2020 business budget!

 

Employee Involvement

 

You do not have to handle all elements of your business on your own, nor should you try to. Having a team to help you with your business budget can help to not only improve efficiency, but also hold you more accountable for sticking to the set budget. Create a budget team of employees that will assist you in maintaining your business budget. Having more than one voice can help you create a plan from multiple different perspectives, allowing you to consider things you may not have thought of on your own. You should keep employees updated on both short and long-term financial goals so they understand the vision and are also prepared for any upcoming financial changes.

 

Analyze Risks

 

Every business has potential risk factors involved that can affect their finances. You want to analyze all of the possible risks that your business has and budget accordingly. It can be difficult to budget for things that haven’t happened yet and that may never happen, but having extra money set aside just in case can save your business in case of an emergency. You want to always leave room in your budget for any unexpected expenses that may arise.

 

Overestimate Expenses

 

When you are mapping out your expenses for the upcoming months, it’s always best to overestimate rather than underestimate your expenses. A lot of businesses operate on a project-to-project basis, which means that no two projects will be exactly the same. Some projects may go over-budget and you have to be able to compensate for that. As mentioned before, an important aspect of budgeting is planning for the unexpected. Leaving room for going over budget will ensure that your business continues to make money rather than lose it.

 

Time is Money

 

The phrase “time is money” is something that we hear often, but often don’t account for in our business budgets. The more time a project takes, the more money it costs in the long run. A big part of maintaining your business budget is to always plan out your time as well. You want to treat your time as if it’s money, meaning setting concrete project deadlines to ensure things get done in a timely fashion. If you think a project will be finished on Friday, promise delivery on the next Monday. That way, you can deliver it early if it gets done on time and leave some extra time in case the project isn’t finished by that day.

 

Constantly Revisit Budget

 

The best way to maintain your 2020 business budget is to constantly go back and revisit the budget. When unexpected expenses or income arises, you want to adjust your business budget accordingly. Businesses are constantly changing and fluctuating, so your budget should do the same. A good rule of thumb is to revisit your budget at the end of each month to make the necessary changes require to keep your business on track.

 

Contact PL Consulting Today for Your Business Budget!

 

At PL Consulting, we consider our clients part of our team. We provide full financial management services including bookkeeping, accounting, payroll, tax preparation, budgeting, and more.

Serving the Baltimore area for several years, we are dedicated to providing customized service to fit each and every one of our client’s unique needs.

To book PL Consulting today or get more information, contact us at (410)-764-3731 or at https://www.plcfo.com/contact/

Tax 101: Small Business Preparation Tips

 

Tax season starts this year on Monday, January 27th. Though filing taxes isn’t everyone’s favorite task, it’s better to get it done early than wait until the last minute. Once you file your small business taxes, you’ll have a better idea of your official budget for the year. Here are some small business preparation tips for this year’s tax season!

Separate Personal & Business Expense

 

When you first start up your small business, you may find it difficult to separate your work and business expenses. While it may seem easier to just keep all financial information in one place, this can lead to a lot of confusion during tax time.

 

Mixing expenses can cause the IRS to disallow certain business expenses and also confuses your accounting information. The best way to prevent this is to open a separate bank account for your business.

Track Expenses

 

Keeping close track of your business expenses allows you to better reduce your tax liability. Certain business expenses can be used to reduce your adjusted gross income, therefore reducing the amount of tax money you’ll owe.

 

Keep track of each and every expense your small business makes, including office supplies, entertainment, travel, advertising, and insurance. Waiting until tax time to try and track your expenses increase the chance of overlooking something.

Remember the Dates

 

The IRS provides a tax calendar that helps businesses keep track of deadlines for tax season. This calendar includes dates for things like filing W2’s, W9’s, making estimated payments, and filing your return.

 

For freelance workers and independent contractors, you must obtain 1099’s from the clients you worked for during the year.

Digital Receipts

 

Modern technology has made it so much easier to get through tax season. There is expense tracking software that allows you to scan and save all of your small business receipts.

 

This makes it way easier to organize your expenses when they can all be accessed from one place. Creating digital receipts means you can throw away those paper ones, helping you organize your business space as well.

Hire a Professional

 

As a small business owner, your expertise may not be in accounting and that’s perfectly okay. Even with the expertise, time is limited when you have a business to run. Rather than stress yourself out about your business taxes, hire a professional to take care of it for you.

 

An account knows how to file your taxes correctly and efficiently the first time around. Having an experienced accountant on your team can make or break the long-term success of your small business.

Contact PL Consulting Today for Your Accounting Needs!

 

At PL Consulting, we consider our clients part of our team. We provide full financial management services including bookkeeping, accounting, payroll, tax preparation, budgeting, and more.

 

Serving the Baltimore area for several years, we are dedicated to providing customized service to fit each and every one of our client’s unique needs.

 

To book PL Consulting today or get more information, contact us at (410)-764-3731 or at https://www.plcfo.com/contact/

The Four Elements of Bookkeeping

Bookkeeping is essential to keeping your business finances organized and accounted for. A bookkeeper is responsible for keeping track of each and every financial transaction that takes place within your business, both ingoing and outgoing. This allows you to see exactly where your money is going and plan budgets accordingly. Here are the four elements of bookkeeping!

Accounts Receivables

The accounts receivable refers to the money that is coming into the business. Your bookkeeper should be sending some type of invoice to clients for all the services that you’ve performed for them. This invoice shows all the necessary costs that the client is required to pay to your business.

 

The bookkeeper keeps track of all incoming payments from clients, marking them down as deposits are made. Your bookkeeper also takes on the responsibility of following up with any clients that may be behind on payments.

Accounts Payable

Though businesses may not be too excited about accounts payable, it is still crucial to keep track of it. The accounts payable refers to the bills and expenses that your business has to pay to others.

 

A good bookkeeper will keep track of each and every outgoing payment your business needs to make. This helps you keep track of what you owe so you can determine the best system to make payments that maximizes your cash flow.

Bank Reconciliations

Your bookkeeper is responsible for regularly going through all of your bank and credit card transactions. They ensure that all your statements stay organized and sort them out so that they’re always easily accessible.

 

Bookkeepers also go through to make sure there are no duplicate transactions documented which could impact your business finances.

 

Once they’ve entered all your card transactions, they will go through to make sure that each account matches up with their bank statements and there’s no discrepancies.

Payroll

A good bookkeeper doesn’t only keep track of your accounts, but can also keep track of your payroll as well. Having someone operate your payroll saves you so much time, allowing you to focus on other important elements of business.

 

Your bookkeeper will keep track of your employee’s work hours, days off, commissions, etc. Once all of this is entered, the finished form will be sent to your management team for final approval and then payroll will be completed from there.

 

Your bookkeeper will keep track of this information and prepare tax documents for employees during tax season.

Contact PL Consulting Today for Your Bookkeeping Services!

At PL Consulting, we consider our clients part of our team. We provide full financial management services including bookkeeping, accounting, payroll, tax preparation, budgeting, and more.

 

Serving the Baltimore area for several years, we are dedicated to providing customized service to fit each and every one of our client’s unique needs.

 

To book PL Consulting today or get more information, contact us at (410)-764-3731 or at https://www.plcfo.com/contact/