Small Business4u

Internal controls protect a company from fraud and also allow a company to be in compliance with Generally Accepted Accounting Principles, or more often referred to as GAAP. 

What is internal control?

Overall, it a process implemented by a company’s Board of Directors and Management, designed to provide reasonable assurance regarding objectives in the following areas:

1.       Effectiveness and efficiency of operation in the business

2.       Reliability of Reporting

3.       Compliance with applicable rules, laws, and Regulations governed by GAAP, FASB, and GASP

Accounting systems provides businesses with a uniform way to use a company’s data and financial information to strategize in the areas listed above.

There are four key elements of implementing internal control:

1.       1.Environmental control

2.       2.Risk Assessment

3.       3. Control Procedures

4.       4.Monitoring  of all of the above – the overall system

The reason these issues are so important is that it ultimately protects the company from fraud and collusion.   In addition to criminal injuries, good internal control is necessary to inform the management of abuses or inconsistencies vis a vie over-production, poor production, or inadequate production by both personnel and equipment.  For example, manufacturing production controls must be stringently adhered to.  If a machine is off by 5% in making a product, the ramifications of this downturn could be a disaster.  Simiiarly with people.  People in an organization need to know what is expected of them up front.  This comes with good controls.  It then becomes easier to monitor their commitment, production and success at their job.  Numbers do not only belong in the front office.  For a business to run successfully, all employees need to know production numbers, reality of achieving those numbers and  can contribute mightily to enable production to increase based on their input.

In short, we could write pages about internal controls.  Suffice to say that this is just a snippet  of information  about running a business.  If you are a small business owner, an example of internal controls would be the issuance of a purchase order to your supplier, a receiving ticket created by you when product is received, and matched to an invoice when received.  Although internal controls can sound sophisticated and overly-complicated, the bottom line is that you must know your business, understand all facets of your business, and in general ALWAYS control the money.  Start with that and then we can go to using GAAP and FASB.  Good luck!

Let me first start out and say that I am an internet marketer. Fairly new. That seems to be the problem. I am also a business coach and a dyed-in-the-wool entrpreneur. I have built two relationships with some internet experts online. I have paid for their packages and even looked at who they recommended. But what is going on with the push, push, push!!! Being fairly well-educated, I know how to read. If I don’t buy something at the original price of $399. how can it be reduced to $49.? This is a con and I for one am getting a little tired of being pushed into buying more and more and more on this subject. Instead of talking to me as an intelligent person and selling as an intelligent person with a legitimate product, I am getting inundated with crap. How do I know it’s crap? I don’t know for sure, but the example above gives me a clue. If a product is legitimate, it should have a legitimate price, maybe a sale, but that’s it. Who are we kidding here. Just get enough suckers to click on a site and give them a crap ebook that doesn’t really show them anything because you have to be an expert anyway.

Luckily I think I have found some good resources, but it wasn’t easy. Yes I would like to make money on the internet. Yes as much as I can. But don’t throw stupid numbers at me that a new person could NEVER hope to achieve in the beginning. I know business and I am prepared to LEARN the internet business. I don’t expect miracles but I resent these get rich schemes that prey on anyone that expresses an interest in learning this industry. Vultures is too kind of a word. So for those of you who are interested in this business, let me give you some legitimate resources that offer a real product for a fair price. No I’m not an affiliate and get no money for this. I just want you to have good resources.

FYI

www.thirtydaychallenge.com

This course if free given by Ed Dale and Dan Ranies and is truly a gift. They are giving back to the internet community in an most honorable way.

WordPressDirect.com

Run by fair people for a very fair price. Great source for finding key words.

TrafficGeyser.com

Again, very fair price and tremendous information about using video and audio on your sites.

With these 3 sites, you can begin to understand what’s going on in the internet world and start your business with confidence. Also, when you start getting billions of offers for other products, be careful what you buy. You might not need it. Inform yourself first by reading blogs. Happy Holidays Lorna

Business as we all know, involves risk. Since starting up your own business means starting a new chapter of your life, you may fail to recognize a few shortcomings in your business plans, as you are too engrossed and feel that things are going great. However, it is very essential to have an outsiders view on the simplest of things, as they will assess your business as any other business and will come out with views that you may have not realized. To be precise, it is advisable that you appoint a business coach who would keep you on track and help keep you a step ahead of the competition.

It is very important to keep learning every day in order to ensure growth. Business owners around the world may not have sufficient time to keep an eye on what is happening in the global business scenario. They may not even get time to keep up with their own company so in times like this the role of a business coach becomes all the more valuable. Business coaching may prove to be very fruitful for your business, as your business coach will be someone who will hold you accountable, someone who will keep you on your heels by pushing you and providing the precise information needed at the right time.

A proper business motivation is necessary to ensure profitable operation. It is the core of any business activity and your business coach ensures that you complete this stage. Since your business coach can help you create a business plan before starting up your business or even a marketing plan later, this will give the business owner a clear picture of what needs to be done in order to revive their business and help them double their profits.

Business coaching can be a great help before you start a business and at any point afterwards. In the initial stage, coaching will help you realize the areas where your interests lie. After you start your venture, business coaching can be a great help in re-injecting the motivation and passion back into your activities. Investing in hiring a business coach can yield rich returns; as they can help to increase sales by training the sales staff. They can identify the target market for your business and help in hiring the best people and motivate them to increase productivity. Your business coach can also prove to be a great asset for your company in the field of customer service, as they can help you keep your customers satisfied and loyal to your company. This will result in the doubling of your profits, as satisfied customers keep coming back, while new customers are referred by existing customers.

A professional business coach will work with you like a personal adviser to help you realize your goals in a clear manner and help your business reach its full potential. So if you are planning to double your profits, you need to have specific goals in mind because everyone wants to earn more than they invest.

Hi everyone,

When I meet with people starting a small business, typically what does not get addressed is paying yourself.  It is imperative that you pay yourself!  So we put together some informtional data for you to hopefully answer some of your questions.

Joseph asked:

Q.    How much of my IRA contribution is tax deductible?

A.    It depends.  All strategies work different based on your income whether you have met the full available contribution for that year and if you and your spouse, if jointly filed, earned more in taxable compensation than the maximum deductible amount for your IRA contributions.  In most cases you will be able to deduct the full amount of your contribution up to the maximum deductible amount.

Richard asked:

Q.    I am leaving my company and taking my 401K proceeds.  How much time do

I have to deposit them in an IRA before they are taxed as income?

            A.  Typically you have 60 days to roll over your distribution if the money was

                  given to you.  The safest way to do this is to have the company administrator

                  write a check to the IRA rollover account directly.  This insures that nothing

                   is withheld in taxes and is a much easier and cleaner way of achieving your

                   transition.

Gabriel asked:

Q.    Can I have multiple IRA accounts at different institutions?

A.    Yes.

Thomas asked:

Q.    What is the fee structure associated wit IRA’s?

A.    First of all it is important to understand that there are variable products and traditional products available.  Most traditional products charge no fee and are a more secure avenue of attaining your goals.  Variable accounts on the other hand can vary from ten to sixty dollars per fund.  They each offer different services and benefits and you should consult with your financial advisor for the best plan of action. 

Jesse asked:

Q.    If I have an IRA in a brokerage account can I sell the stock in my brokerage account and immediately invest it into my traditional IRA account?    

A.    You can not mix a non IRA brokerage account with an IRA account without creating tax ramifications.  (By law this is considered self dealing and would not be allowed.)

Ashley asked:

Q.    What happens if I contribute too much to my IRA?

A.    Typically you would need to with drawl some or all of the money from the plan or reallocate it to next year contributions.  In this situation, the tax payer has until the due date for filing their tax returns. Not including any extensions to with drawl the excess contributions plus any income generated by the excess contributions. 

Billy asked:

Q.    What are the implications for my estate if I leave my investments in my IRA?

A.    IRA accounts can be rolled over to a spouse with no immediate income taxation or to the descendent, the estate, or the spousal beneficiary.  However, if there is no surviving spouse or when the surviving spouse dies still owning the IRA assets these assets are typically highly taxed.  Proper planning for your estate with life insurance a consulting with your financial advisor on a frequent basis will generally help you avoid these potential problems.

Theresa asked:

Q.    What type of investment can be used as an IRA?

A.    Almost all investments are technically eligible for inclusion in an IRA account.  Most commonly people will link their IRA to some form of an Annuity avoiding probate tax and broadening the spectrum of the potential investment options.

David asked:

Q.    Is Gold an eligible purchase inside an IRA?

A.    Yes.  This is a very excellent question. This is a popular form of investing in today’s unstable market.    

Randy asked:

Q.    How do I decide which IRA is right for me?

A.    It depends on your taxable income, your age and your family status. It is best to let your financial advisor do a thorough analysis of your situation and they will best be able to guide you in the direction that will help you achieve your goals.

Danny asked:

Q.    How do I sign up for an IRA?

A.    Only certain organizations can open an IRA for you.  They are called trustees or custodians.  The IRS may approve certain financial institutions, brokerage firms or insurance companies to act as a trustee or custodian for IRA’s.  I would recommend you seek out an independent brokerage.  Most reputable brokerages do not charge an in house fee because they are compensated directly from the trustee or custodian that they place you with.  More importantly they are not representing one trustee but several and will be able to offer you a variety of options not just one vehicle that could limit your potential for greater success.

Gretchen asked:

Q.    Can I donate my IRA to a charity or as a gift?

A.    The best way is to name the charity as the beneficiary of your IRA.  This will help avoid a heavy tax burden when you take money out while still alive.  Keeping in mind if you donate any monies prior to age 59 ½ you will still incur a 10% early penalty.

Wade asked:

Q.    Can I borrow funds from my IRA? 

A.  No, but if properly set up with the right trustee most companies will allow you to take a 10% penalty fee with drawl on an annual basis.

Q.     What is an IRA?

A.      An IRA is an INDIVIDUAL RETIREMENT ACCOUNT.  An IRA is a personal savings and investment plan that provides substantial tax advantages to individuals saving money for long term retirement purposes.

Q.    How does an IRA work?

A.    You invest money into an IRA up to the allowable amounts under tax law (consult your financial advisor for consumer limitations).  These investments are termed “contributions”.  In most instances tax deductions are available each year in which funds are contributed.  All contributions as well as earnings and gains accumulate tax free until you withdraw money from the account, therefore allowing you to generate substantial additional earnings.  To avoid any unnecessary taxation of the value of your IRA, distributions should never be taken before the age of 59 ½.  In addition the government can tax your IRA no later than April 1^st of the following date that you attain age 70 ½.

Q.    How many different types of IRA’s are available?

A.    There are five. 

1.      Traditional IRA

2.      Education IRA

3.      SEP IRA

4.      Simple IRA

5.      Roth

Q.    Who is eligible to open an IRA?

A.      Any individual can make contributions to a traditional IRA as long as you or your spouse have received taxable earned compensation during the year and were not over the age of 70 ½ . (Considering the strong differences between IRA’s you should always consult your financial advisor for the strategy that will be best for you.

Q.    What are the contribution limits to IRA’s?

A.    It all depends on which type of IRA you select.  Maximum contributions can typically be made through the avenue of a SEP IRA and traditionally the lower contribution amounts would be made through a Roth IRA. In addition after 2006 most IRA’s were set to be indexed to inflation.  Meaning limits will continue to increase for years to come/

I hope you found this information informative.  More in a later blog.

At the cost of you not liking what I’m writing, let me first say that if you’re on this blog, you believe in individualism and capitalism.  So on the eve of this election, I felt compelled to write to all of you regarding the fact that whatever your politics are, the election has given a welcome to socialism.  Those of you who have your own business or are starting one, would be naive if you are not concerned about the coming 4 years.  Free speech is at stake and therefore the internet is at stake.  Taxes may be going up and the economy most certainly will continue to sag.  I will be writing more about this in the next few days, but if there was ever a time to obtain extra income it’s now.  You need to escalate your independence while you still can.  Start pushing your business and working harder.  Money is the measuring stick of your success in this, not feeling good.  So let’s get going.  I will be putting up my new website in the next week and will be offering some great podcasts to get you going.  More later.  L