Accrual Basis vs. Cash Basis Accounting

Are there any accountants out there that would like to convince me that accrual accounting is better for a small business than cash accounting?

I'm talking about having a discussion, not an argument. An exchange of ideas and open minds. We can have a civil chat and explain to each other why we think our idea is better.

I believe that cash accounting is the only way to go for small businesses unless accrual accounting is required for a bank loan.

How small a business?

Let's start at the $25,000,000 mark. That the IRS limit established in 2018 before you need to do accrual accounting for tax purposes.

I am guessing that there are a few accountants out there that disagree with this position!

Are you interested in having the conversation?

Please let me know in the comments!

#accounting #wtcfg #bookkeeping

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Crowdfunding for Cash Management

Do you know that crowdfunding can be an effective cash management tool for raising capital?

Crowdfunding is pre-selling products that are in development. You owe people something, but usually at a good profit margin. You don't sell equity in your company and you don't go into debt. You do get:

- Publicity before you launch

- Feedback on your product

- Ideas for additional product

- An idea for market acceptance

- Names for your mailing list

- The cash you need to launch the product or business

Most people think of Kickstarter or Indiegogo (I've used Indiegogo) as only for new companies...wrong! You can introduce new products as well.

I've done crowdfunding for non-profit as well as for-profit organizations. Possibilities for funding:

- Book launches

- Food vendors

- Manufacturers

- Service providers

- Race/adventure organizers

- Non-profit fundraising

The possibilities are literally endless.

Have you done any crowdfunding? I'm looking for any reason not to do it.

Have you bought something from...

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Cash Flow Management Software

If you are interested in learning more about cash flow management, then you should follow Barb EasterBlaine Bertsch, and Jeremy (JD) Burke from Dryrun - Cash Flow Management Software. These hyperlinks will take you to their LinkedIn pages.

Why would I recommend you follow someone else and not spend all of your cash flow time on my posts and articles?

A few reasons:
1. They have a great point of view

2. They work with end-users and finance professionals from all over the world

3. DryRun is the best cash flow management software I have seen so far for businesses over about $1 Million in revenue

4. They are educating the marketplace

I'd love feedback on what you think about DryRun software.

Do you use cash flow management software? Or spreadsheets?

If so, I'd love to hear your opinion on your software or why you use spreadsheets.

What do you like? What doesn't work? What else do you need?

Let me know in the comments below!

#tcmp #finance #bestadvice

*I am not...

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The Courage to Lead Episode 94 - Courage to Care About the People

Follow this link to listen to the episode on Apple Podcasts.

I had a great time on The Courage to Lead with Harlan Hammack discussing cash flow optimization (including some counterintuitive tactics), planning for the future, explanation of some of my offers here on the website, and more. 

I also got to share a bit more of my own story of how I came to be involved in cash flow advising. It was not an easy decision, but it was a logical one.

Coach Harlan was a great host - big thanks to him!

Follow this link to listen to the episode on Apple Podcasts.

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Dynamic Mapping interview with David Safeer

Follow this link to listen to the episode on Apple Podcasts.

I had a great time on the Dynamic Mapping podcast with Jeff Mount last week discussing diverse areas of financial advising, common mistakes small businesses make, accrual vs. cash-basis accounting, and more.

I also got to share a bit more of my own story of how I came to be involved in cash flow advising.

Jeff was a great host - big thanks to him! 

Follow this link to listen to the episode on Apple Podcasts.


Did you learn anything new? Did I miss anything? Let me know in the comments!

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Flat Volume with Increased Sales and Profits

 

A few weeks ago I broadcast this information about how to increase sales and profits without increasing volume of any kind. 

Listen in to hear about a specific case study where I made this happen for my client.

If you want to learn more and talk with me, follow this Calendly link to sign up for a brief introductory meeting. The webinar I mentioned in the broadcast will have passed, but I am always available for a chat.

How have you managed your business when money gets tight? Let me know in the comments!

 

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Payne Points of Interest #42 Calculating Cash Flow Featuring David Safeer

 

In this episode, I discuss the ins and outs of calculating cash flow.

Click here to listen on Google Podcasts.

Have an idea? Anything I missed? Let me know in the comments below.

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Don't Try to Not Hit the Tree

 

I just came across this favorite Cash Management Minute, and find its principles to stay true as ever.

It is much more effective to decide what to do instead of what not to do - in skiing and in business!

Does anyone else find this to be true? Or are you looking forward to hitting the slopes this winter like I am? 

Let me know your experiences (or your favorite place to ski) in the comments below!

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Strategic Action Plans

Strategic Action Plans

You know where you are today. You know where you want your business to go. So why is it so hard to change?

Because making real changes in a business takes big, bold shifts in actions, attitudes, and thinking.

You know all of that, so why is it STILL so hard to make changes?!

Because most business owners and managers are so busy working on the day-to-day challenges of running an ongoing business that it is next to impossible to focus on the work needed to create change.

Strategic action plans identify the changes that need to be made in a business and then break them down into achievable tasks that can be accomplished in 1-2 weeks. Most of the time an individual task doesn’t make a major change in a business. But ask yourself, ”What would happen to my business if every week I can implement just two small changes that would move my business in the direction of my ultimate goal?”

Two changes a week would mean 26 changes for your business in the...

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Revenue Growth: Beyond Sales & Promotions

 A quick internet search on the term “list of ways to grow sales” brings up list after list of “proven ways” to grow sales. Most suggestions are sales and instant demand generation activities.

Why is there so much focus on sales and instant demand generation? Three fundamental reasons:

  1. These are quick fixes that often create the illusion of an increase in sales, followed quickly by an offsetting dip in sales the following month or quarter. The pressure to “make the month” or “make the quarter” overrides the damaging creation of a cyclical pattern that becomes obvious to the marketplace and reinforces these solutions, which usually involve discounting, “stuffing” the distribution channel, or providing incentives to purchase.
  2. This is the “fun” stuff and people are enamored with the creative solutions of advertising, promotions, slogans, flashy websites, and spending money to make money. It feels good to buy...
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