Accounting for Small Business
In this article, Accounting Courses Montreal, explains how our two-day accounting course can help small business owners.
Who does accounting for small business apply to? It applies first and foremost to the owner of the business. Any owner / manager who does not understand accounting ‘the language of business’ is handicapped from day one in his role as CEO. Be he a lawyer, a mechanic, a plumber, a wholesaler, a commission agent, a manufacturer, etc., the owner / manager must have at least the knowledge level of a bookkeeper and even the knowledge level of an accountant.
Often resources on start-ups are limited and at least the owner / manager who knows accounting can ensure that the basic accounting records are maintained. As the business expands he can delegate, but the initial experience in the role of bookkeeper/accountant will give him the understanding of the double-entry system that organizes transactions and presents the summarized information to users, including himself.
Too often small business owner’s rely on external accountants at the outset and fail to see the need to understand a system that informs them as to how their sales are doing and if they are spending too much. They often feel their skill set should relate chiefly to the product or service they provide. Not so!
The external accountants are involved typically after the year end which is too late in the process. The owner must take the bull by the horns from day one.
Many CEO’s of large businesses although they have internal accountants still have professional accounting backgrounds as its understanding was crucial to their rise up in the ranks. There is no excuse for the owner manager of a small business. If he does not understand and implement an accounting system he is sailing a ship without a rudder!
What then is this accounting for small business that the owner must perform?
It is a double entry bookkeeping system. It was invented by an Italian back about 300 years ago and as famous investor Charles Munger says ‘It was a hell of an invention”.
Essentially it tracks and explains where the assets of the business came from and how they were used. It involves recording every transaction the business enters into. Transactions are evidenced by sales invoices, the deposit slips, the vendor’s invoices, the cheques and bank statements called source documents and are used by the bookkeeper to record in a book or ledger. This book is then used to summarize the information into financial statements to be given to users periodically. The process is simple but it must be maintained!
Where is accounting for small business done? It is best done where the owner / manager of the business works and that is on the business premises themselves. The source documents are the first part of the accounting process. They usually must be kept on site as they are referred to by the owners to determine costs, customers buying history etc. They are typically filed by bookkeepers in filing cabinets once posted to the ledger.
Some accounting for small business is contracted out to outside service bureaus however, where bookkeeper / accountants record the transactions at their location and return the documents. The disadvantage may be that documents leave the premises and are unavailable at times and must be refiled upon return.
When is accounting for small business done? The best time to record small business transactions is daily as the daily cash balance is being maintained. This will ensure that the books are up to date. Too often small business owners do not record transactions in a timely manner and leave all documents in a shoe box so to speak to be recorded by some external bookkeeper / accountant at year end, or even much much later! This is less than ideal as it usually results in untimely information which is no longer useful, misclassifications of items and can result in penalties for late filing by governments.
Why is accounting in small business essential? The chief reason easily understood by owner /managers at the outset for accounting systems is to fulfill their reporting requirements to the government departments. In fact there are often at least seven government departments alone that rely on the accounting information the small business produces. These departments are known variously as the GST, PST collections, the Federal and Provincial payroll deduction at source departments, the Federal and Provincial corporate tax agencies as well as the Federal and Provincial annual industry return departments!
To this list we can add the company bank if any type of credit facility was set up. And of course the owner/manager himself should be reviewing and using the product of the accounting system to make better informed decisions.
How is accounting for the small business done? Whether it be the owner/manager himself, his assistant bookkeepers or some outside accountants, the accounting process can be done manually, with the assistance of a computer in the form of a spreadsheet or using a fully computerized package that processes the information from journal entries. The fully computerized systems tend to produce a lot of paper which is difficult to sort through, to correct if required and to understand by the owner/manager.
Accounting Courses Montreal teaches the principles needed and combines this with a straightforward recording process using a Microsoft Excel spreadsheet that turns the owner/ manager into a bookkeeper in a short time. Whereas university courses are long, typically spaced over 3 to 4 months our course comprises two 6 hour days and about 4 hours of home study. The course is short but complete. Our graduates meet the small business accountant description and can do the books of their own company from the get go.
Courses are taught by Mr. F.McInnis CPA, CA with over 30 years of experience as a professional accountant and educator to small business owners.
Being an Accountant
The reality is that many people working in accounting have no university training but have learned on the job and become self-taught over the years. What many students don’t realize, however, is that an accounting degree is not the only route to accountancy. Accounting Courses Montreal offers you a few explanations and distinctions concerning the title accountant.
In Montreal and Quebec, “Accountant” is a loosely-used title to describe the person who engages in the process working with a bookkeeping system, as well as monitoring and interpreting accounting data. It is noteworthy that in some countries, “Accountant” is a reserved title that can only be used by individuals who achieve a professional designation.
In general terms, Accountant is often cited as the bookkeeper, controller, or accounting technician excercising bookkeeping activities in any given accounting depertmant such as accounts receivables, accounts payables, payroll, etc. This general accounting category is well explained in our Accounting Courses Montreal offer.
Becoming a Chartered Accountant CA
The Chartered Accountant – CA (somewhat equivalent to the CPA designation in the United States) designated by C.A., is the most prestigious title an Accountant can attain. Becoming a Chartered Accountant requires at minimum the completion of a specialised three year undergraduate degree in accountancy from a recognised University, as well as a two year practical assignment in an accounting function, and the writing of the CA Exam.
Becoming a Certified General Accountant CGA
The Certified General Accountant – CGA designated by C.G.A., requires at minimum the completion of a specialised three year undergraduate degree in accountancy from a recognised University, as well as the writing of the CGA Exam.
Becoming a Certified Management Accountant CMA
The Certified Management Accountant – CMA designated by C.M.A., requires at minimum the completion of a three year undergraduate degree from a recognised University, as well as the writing of the CMA Exam.
Upcoming Changes to Professional Requirements in Quebec
As of 2012 all current holders of the above designations must utilize the title CPA and their professional designation as above in the Province of Quebec.
Accounting Jobs in Montreal
Accounting Courses Montreal offers links of Accounting Jobs in Montreal. We consider Montreal to be a vibrant economy with many opportunities for employment in the filed of accountancy. We invite you to review our accounting courses if you are planning to work in the accounting field in Montreal. We are confident that these courses can help.
Please take a few moments to visit the sites below to see current accounting opportunities in Montreal.
Craigslist: accounting jobs montreal
Workopolis: accounting jobs montreal
Indeed: accounting jobs montreal
Accounting Courses in Montreal
Many students who elect to study accounting do so with the intention of becoming a professional accountant.
What many students don’t realize, however, is that an accounting degree is neither necessary nor sufficient for an accounting career.
University student to professional qualified accountant is only one route. Many people working in the field of accounting have no university training but have learned on the job and become self- taught over the years.
Unfortunately many of this second group did not adequately learn the basic accounting principles and terms from the outset and thus struggle continuously with what are the basic rules of accounting. Accounting Courses Montreal attempts to answer the need for people starting out in this second group.
Careers in Accounting
Careers in accounting are available to students in school or out of school looking for a new path, to individuals unemployed or now working but looking to a higher paying job, to housewives looking to get back into the workforce or wanting to work only part-time, etc.
Accountants engage in a wide variety of activities in the business world but the core of the accountant job description involves being able to understand how transactions are recorded in journals, posted to the general ledger, adjusted at year end to produce financial statements that interested parties use to make decisions about a company.
Careers in accounting start with a sound understanding of the double entry system of recording transactions in the debit and credit formats. The accounting equation must be understood as well as the elements and basic principles of accounting.
He or she must understand how to prepare GST/PST, payroll, car allowance, petty cash forms. At this point if understood the individual can begin to call himself an accountant. Experience and diligence will of course help to cement the accounting career.
Non-university accountants can find careers in accounting in small, medium and large businesses. Accountant job descriptions initially involve work as accounts payable, accounts receivable clerks and then jobs as full-fledged accountants / controllers.
Accounting careers can also involve work as self-employed accountants catering to the needs of small businesses.
The basic accounting principles and methods of accounting are consistent now all over the world and so the company and it’s work location is often the individual’s choice!
Accounting Jobs Montreal
There is no better time than now for careers in accounting.
With the increased regulation that came from the Worldcom and Enron scandals in the early 2000’s the need has not abated and in fact the accountant job description has enlarged.
The accounting career continues to evolve but taxes, audits, bookkeeping will always need to be done. Accounting jobs are plentiful even in a weak economy.
Accountants are well paid and job satisfaction is high. The work is stimulating, challenging and is constantly evolving. Because accountants spend a lot of time ‘under the hoods’ of businesses they really learn the nuts and bolts of its operation. It’s no surprise that many of the top executives in business began their careers in accounting.
The best way to start your accounting career is to let Accounting Courses Montreal get you on the right track.
Whereas university courses are long, typically spaced over 3 to 4 months our course comprising two 6 hour days and about 4 hours home study is short and concise.
Our course teaches the principles needed and combines this with a straightforward recording process using Microsoft Excel.
It is practical and covers areas like GST / PST, Federal and Quebec payroll requirements that all businesses’ demand.
Our graduates meet the accountant job description and can do the books of a small company from the get go.
Courses are taught by F. McInnis CPA, CA with over 30 years of experience as a professional accountant and educator.