Bookkeeping

Well-managed bookkeeping is central to any business. It ensures that all financial transactions have been properly recorded, making reporting accurate, up to date and meaningful. Bookkeeping refers to a wide range of functions that can often be labor-intensive and time-consuming to take care of - that’s where we come in! The Profit Line takes a hands-on, detail-oriented approach to bookkeeping for our clients, so that owners and managers can focus on achieving their goals and growing their businesses, being assured that their financial records are in order.

In the course of your business operations, you enter into a wide range of financial transactions, all of which need to be properly recorded and accounted for. In essence, bookkeeping is the process of journalizing, or recording, all of a company’s myriad transactions into their appropriate accounts. Utilizing accounting principles, bookkeepers work to accurately categorize transactions as they occur, not only to facilitate daily operations, but also to aid in business decision making and to ensure that all financial transactions are accurately recorded when it comes time to put together periodic financial reports and statements.

While ensuring that transactions are accurately categorized, bookkeepers also work to keep track of ALE, so your Balance Sheet is accurate. What is ALE, you might ask? It’s an acronym for the basic accounting equation: Assets = Liabilities + Equity. Put more simply, they look at what the business owns (Assets), what it owes (Liabilities), and its net worth (Equity).

Sound complicated? If you think so, you’re not alone! For many people, having an understanding of accounting principles is a daunting task and then having to apply those principles to their own business seems downright impossible. Not to mention how much time is spent on recording transactions and managing the books.

At Profit Line, we are well acquainted with the struggle that many small businesses and non-profit organizations face when it comes to keeping their finances in order - and we’re here to help! Our team is made up of a group of expert accountants and bookkeeping professionals who are committed to alleviating the burden of managing financial records on your own. We utilize the most advanced accounting and bookkeeping software available to devise a bookkeeping solution that makes sense for the individual needs of your organization. Whether you’re selling products or services or operate domestically, internationally, or a combination of both, our team’s extensive experience with a diverse set of clients means we have the knowledge and expertise to handle your specific situation.

Bookkeeping involves a wide variety of functions, and Profit Line knows how to manage them all. When you choose to work with us, your dedicated team member will work closely with you to build out a set of services that fits your needs. With our customizable service plan, you can choose and pay for only those services that you really need. There is no such thing as a one-size-fits-all bookkeeping plan, and our goal is to tailor our services to meet your needs.

If it sounds like a dedicated bookkeeper is for you, we encourage you to explore the variety of bookkeeping services we have available. Customer Invoicing and Accounts Receivable Management, Expense Processing and Accounts Payable Management, Bank and Credit Card Account Reconciliations, Financial Reporting - you name it, and we’ve got it. We are a full-service bookkeeping company on a mission to provide you with the specific bookkeeping services you need. See our list of bookkeeping related services below:

BOOKKEEPING SET UP

Are you starting a new business and want to get your financial records set up correctly, from the get go? Or have you been in business for a while but never set up a good bookkeeping system? Are you mired in paper records and think a digital bookkeeping system would better serve your needs?

If any of the above sound like you, you came to the right place. At Profit Line, our team of expert accountants has the expertise necessary to build out the bookkeeping system to meet your needs. In many cases it begins with developing a well-organized and meaningful Chart of Accounts for your specific business.

By utilizing our knowledge of accounting principles and bookkeeping software like QuickBooks Online (QBO), we will get your digital records set up in no time at all! If you previously used a paper trail to account for your finances, don’t worry, we can upload your information to the QuickBooks platform, making sure all of your key data is captured.

BOOKKEEPING CATCH UP & CLEAN UP

We begin working with most of our customers long after they have already established and maintained their bookkeeping system. However, somewhere along the line, they outgrew their bookkeeping system or for one reason or another bookkeeping fell behind or got put on the backburner. In many cases, our customers experienced rapid expansion in their operations and didn’t have the manpower or knowledge of more sophisticated bookkeeping systems to keep up with their increasing recordkeeping demands and financial reporting needs. In still other cases, the business or non profit organization is stuck, and can’t grow or scale without updated bookkeeping systems.

No matter which happens to be the case for you, Profit Line is ready to work with you and get your books and bookkeeping systems updated and in greatest working order. Our bookkeeping catch up and clean up service is available to assess where you are in your record keeping journey right now and to develop a tailor-made solution to ensure your financial records are complete and accurate.

So what does bookkeeping catch up and clean up really entail? To begin, we work with you to gain an understanding of the nature of your business, where it’s been, and where it is going in the future. Then we take a look at your books to get a sense of where your transactions have been recorded thus far. At this point we study the structure and current use of your Chart of Accounts to see if accounts need to be added or certain transactions need to be recategorized. We also work with you to see if there is any information that is missing. In the whirlwind of daily operations, it is so easy to lose track of receipts or to forget to record every single detail. Part of our catch up and clean up service involves making sure none of your important financial information is missing - whether it be transaction data such as bills and invoices or qualitative information on your clients, vendors, employees or other business contacts.

Another important part of this service is to make sure that all of your external accounts are connected and syncing correctly with your bookkeeping file. This includes connecting, or reconnecting, any missing or stalled bank and credit card accounts with your bookkeeping software as well as syncing any other operational software you might use, such as expense tracking, time tracking, and payroll platforms. In the course of catch up and clean up service, we may also recommend that you adopt additional useful applications as part of your overall accounting stack in order to make your financial recordkeeping more efficient and more accurate. But don’t worry, our team of expert accountants is skilled in the use of a wide range of software and third party applications, and will help you integrate and navigate any additional platforms you may need.

Many customers come to us using desktop software, typically a version of QuickBooks Desktop software. We highly recommend converting from QuickBooks Desktop to QuickBooks Online software, and manage this conversion process from start to finish, ensuring your historic data and account setup migrates correctly to your new online software. Converting to a cloud-based accounting software allows for far more and better integrations with external accounts and other useful accounting applications, and provides far greater ease of access and use.

Once your books are fully in order, your Profit Line team will manage your end-to-end bookkeeping so you never have to worry about getting behind on your finances again! You will maintain full access, and oversight while your personal bookkeepers work their magic behind the scenes - what’s not to love!

ACCOUNT RECONCILIATIONS

The purpose of bank, credit card, loan, and other external account reconciliations is to ensure that the transactions reflected in your accounting records match the transactions that have been recorded on these external accounts, including merchant services accounts, PayPal, Stripe, etc. This process must be performed at least monthly, to make sure your books are up to date and include every transaction you entered into. The reconciliation process can also catch other errors that may have occurred in the recordkeeping process such as transposition and translation errors.

While the premise of account reconciliations sounds simple enough, as a business owner you are probably well aware that, in practice, the process can become quite complex and confusing. Sometimes, as is the case with outstanding checks, transactions have been recorded in your books but are not yet reflected in your bank account. In other cases, transactions such as service charges and interest payments are reflected on your bank and credit card statements but have not yet been recorded in your books. Merchant service accounts may make batch deposits to your bank account, net of processing fees, such that payments need to be grossed up and processing fees recorded separately. Trying to investigate various discrepancies that regularly take place can eat up valuable time, unless this is done efficiently.

At Profit Line, we are experts at account reconciliations of all kinds, across all types of accounts and different types of businesses and non-profit organizations. Equipped with sound knowledge of accounting principles and the most advanced and efficient accounting software, we easily take care of your reconciliations to ensure that all of your financial data has been captured and recorded in the appropriate period. When it comes time to put together financial reports and statements, you can rest assured that your financial accounts have been correctly reconciled, that your books fully capture your transactions, and your reports and statements accurately reflect your financial position.

CHART OF ACCOUNTS REVISIONS & TRANSACTION MANAGEMENT

Proper bookkeeping is about more than merely recording transactions as they occur. Sure, it is great that you recorded the occurrence of a sale or purchase, but was it recorded to the correct account? Transactions that are recorded incorrectly are almost as bad as transactions that are never recorded at all. If your income, expenses, assets and liabilities are askew, you are left with messy books and without an understanding of your true financial position. Not only are you unsure of what you own, what you’re owed, and what you owe, but incorrect financial information also leaves you unable to make informed and effective decisions to move your business forward to achieve your goals and continued success.

At Profit Line, we understand that it takes time and effort to completely and accurately record all of your business transactions. When more pressing things arise, or fires need fighting, it’s easy to let your bookkeeping fall behind. What is more, when you actually do have the time to sort through your finances, a limited knowledge of accounting principles makes it confusing to try to place each transaction in the appropriate account. We empathize with this all too common struggle, and we’re here to help you finally get your books in order.

Strong bookkeeping and transaction management really begins with the Chart of Accounts. When you engage Profit Line as your bookkeeping partner, one of the first things we do, as you’re onboarded, is to review your Chart of Accounts. We want to make sure that your Chart of Accounts is set up correctly, and that it serves your needs, both from a recording, tracking point of view, as well as from a reporting point of view.

Before we can begin to clean up your books or record new transactions correctly, we need to have a strong understanding of your business and make sure that you have all of the accounts you need in your general ledger to properly record your financial information. It may be the case that you have too many or too few accounts, or that you have multiple accounts serving the same function. We will work with you to review and revise your Chart of Accounts, making sure it meets the needs of your business. As we continue to work with you, we will keep an eye on your Chart of Accounts and make adjustments where appropriate as your business evolves. If you’d like to engage Profit Line but don’t already have a Chart of Accounts established, don’t fret, our team of knowledgeable accountants will work with you to get your accounts and general ledger set up correctly.

After creating or adjusting your Chart of Accounts, we’ll utilize your refreshed general ledger as a guide in our transaction management service. Essentially, transaction management comes down to keeping track of all of the business activities you engage in, discerning which activities have a financial impact and need to be journalized, and ultimately recording those transactions in the appropriate place, as outlined by the general ledger.

By trusting your Profit Line advisors to manage your Chart of Accounts and transactions, you can be sure that your recordkeeping will be complete and accurate and will adhere to accounting principles. You never have to worry about missing transactions or messy books again - making your next tax and reporting period a breeze!

INTER-COMPANY ACCOUNT MANAGEMENT

Do you regularly engage in transactions with other departments, divisions or subsidiaries belonging to your larger organization? Does the thought of managing these transactions and accounting for them properly leave you feeling confused and stressed? At Profit Line we understand just how daunting tracking inter-company transactions correctly can be and we are here to help you manage them.

An inter-company transaction is a catch-all term that refers to financial activity that occurs between one division, unit, department or subsidiary of a company and another division, unit, department or subsidiary of the same or related company. Inter-company transactions are quite common, occur for a variety of reasons, and can include transactions such as sales of inventory, loans, transfers of assets, interest fees, and much more.

Inter-company transactions can get complicated fairly quickly as it is crucial to record them in accordance with accounting principles and keep track of all tax implications. Where sales of inventory or assets are concerned, it is important to first identify if transacting with an inter-company unit makes sound business sense, to then establish transfer pricing if you decide to move forward with the transaction, and then adhere to proper revenue recognition rules - usually not recognizing any gains or losses until there is a transaction for that product or asset with an external party.

In the case of transactions between parent companies and their subsidiaries, it is important to maintain arm’s length transactions, where a certain level of independence is maintained. In other cases, inter-company transactions occur between entities that exist in different countries, thus involving multiple currencies and being subject to a variety of different tax laws.

While the above descriptions barely scratch the surface of what can be involved in inter-company transactions, it is abundantly clear that there is a great deal of complexity in this space and that it is also very important to get the accounting right for the purposes of financial reporting, filing taxes, and other compliance responsibilities. The Profit Line has a team of knowledgeable accountants on staff that are well-equipped to handle the inter-company transactions you may be dealing with. In fact, we service many clients who have multiple legal entities both domestically and internationally. If you are looking for help keeping track of and recording your inter-company transactions and maintaining your inter-company accounts, you have come to the right place for assistance. Contact us today to learn how we can help.

SCHEDULE CREATION & MAINTENANCE

Another critical part of transaction management is creating and maintaining detailed schedules for various accounts. Schedules are a more practical way of providing much-needed details for certain accounts. For example, it is crucial to develop supporting schedules for your fixed assets, depreciation, loan interest, and prepaid expenses, among other things. In the case of fixed assets, if your business owns a wide variety of fixed assets, such as equipment, computers, furniture and/or fixtures, you certainly don’t want to track these, in detail, in the related General Ledger Fixed Asset account. The detail lives in your Fixed Asset schedule, where the asset classes can be differentiated, together with their respective depreciation rates. Maintaining such schedules allows you to keep track of the related details - what your assets are worth, what you owe on individual liabilities, and when you can recognize expenses and income if you are following the accrual system of accounting. As your Profit Line team regularly records your transactions, we will update these schedules so you always have the most up to date information, and so that your schedules always tie to their related General Ledger accounts.

If, when we begin working with you, you are missing key schedules, we will be sure to set those up for you as well. As your business grows, and becomes more complex, we’ll let you know when schedules need to be added.

BUDGETING

Both in our personal lives and in our businesses, we know just how important it is to plan, and to understand what lies ahead, this is where budgeting and forecasting come in. Without a clear understanding of how much income you’ll have coming in, and when, and your capacity to spend, and in which areas, you run a big risk of not being able to meet your financial obligations and undermining your financial stability. With a limited amount of funds available at any time, it’s important to allocate those funds strategically to current and future expenses.

Typically drafted before the beginning of a new fiscal year, or at the beginning of a new project, budgets typically represent allocations of funds, usually based on historical data and reasonable expectations for change - growth or contraction. While budgets are rarely ever accurate down to the last penny, they are a good starting point for financial planning purposes. With some idea of your cash flow and your financial and performance goals, you can more easily earmark funds for specific purposes, which will help keep your spending in line during the year, or over the life of a project.

At Profit Line, we know that establishing budgets can be difficult, and we are here to provide the support you need to make this task a bit easier. While we cannot create your budgets for you, we can offer advice as you establish them, and can monitor your progress during the year to help you stay on track.

Where budgeting is concerned, we offer two primary services: Budget Preparation Support and Job Costing. Our Budget Preparation Support services will help you with those more macro-level budgets: think overall company budgets and department budgets. Our Job Costing service is for more micro-level financial planning. When working on specific projects, it is important to know how much money you are spending compared to the money you are bringing in. Not only will job costing help you understand the profitability of your different projects, but, with an understanding of the level of performance you are expecting from your work, it can also help you decide which projects are worth pursuing in the future and where it might be better to pivot into different offerings, change your pricing, or both.

No matter which form of budgeting you are looking for, your Profit Line team will support you every step of the way. We are committed to helping you reach a stronger, more profitable future!

JOB COSTING

Do you know exactly what each of your different projects is costing you and how those costs stack up to the revenues you earn on those projects? If your answer is no, don’t worry - you are not alone. For so many businesses, getting all of the moving parts of individual projects to work is by itself a monumental task. To then determine revenues and costs of those different elements can be frustrating and challenging, especially when there is limited time with which to perform such an analysis.

At Profit Line, we know that engaging in an in-depth financial analysis of each individual project you have or customer you serve can be an impossible task. Nevertheless, the insights that such analysis produces are invaluable. Having a firm understanding of which projects are boosting or dragging down your bottom line will allow you to make smarter decisions about where you allocate your time and resources in the future. It will allow you to better price future projects. We know that running job costing reports can often be pushed to the backburner, so our team of expertly trained accountants is ready to do this important work for you.

So, what exactly is job costing? On a basic level, it is like a mini budget for an individual project, job or order. Its purpose is to calculate and record all of the costs associated with that project and then compare them with revenues earned to assess profitability. Costs will vary significantly based on the type of project being carried out but can include elements such as materials, labor and overhead. These costs can be direct, indirect, variable, fixed, or even mixed, meaning that they will have different methods of being allocated to individual projects.

Job costing can get a bit complicated at times, but rest assured that your Profit Line team is trained to make accurate calculations every time. We will advise you on the different accounting job costing standards that can be applied and will assist you in selecting the appropriate standards for each project you have.

With a strong system of job costing put in place, you will finally have the information you need to assess the financial performance of your projects and to choose which ones you should continue to operate in the future. Job costing will also give you the insights necessary to make estimations of the cost profiles of future projects so that you have a better sense of what opportunities will be financially advantageous before you commit to them. This is financial management done right!

BUDGET PREPARATION SUPPORT

In order to stay on top of your finances and control your spending, it is important to establish a budget every year. Usually, your business’ budget will consist of smaller budgets for the different areas of your company, containing forecasts for revenue and expenses and goals for growth and profitability. When set up correctly and realistically, a budget can be an incredibly powerful financial management tool that keeps your team aligned and on task to achieve the results you are looking for.

If budgeting is something you struggle with, Profit Line can help. Our team of expert accountants is equipped with the knowledge and experience to guide you towards setting realistic forecasts and reasonable goals for your company. Once you have finalized a budget you are comfortable with, we will load it into your accounting system so that the transactions and activity you engage in during the course of the year can be measured against it.

As we all know from experience in both our personal and professional lives, budgets are rarely ever exact predictions. It is normal for there to be some variance between the level of revenues or expenses you thought you would have and what actually occurred. Our team can prepare Budget to Actual Variance reports for you on a periodic basis so you can get a sense of where your actual income and expenses are, compared to your budgeted expectations, and how this might inform your future activity. These reports will help keep you on track to achieve your goals and can be extremely helpful when establishing future budgets.

With a plan for your financial goals and regular feedback on your actual performance, combined with the guidance of your Profit Line team, you will have the insight and tools you need to make sound business decisions and push your company forward to achieve positive growth.

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