BOOKE KEEPING

It involves the recording, on a regular basis, of a company’s financial transactions. With proper bookkeeping, companies are able to track all information on its books to make key operating, investing, and financing decisions.

Bookkeepers are individuals who manage all financial data for companies. Without bookkeepers, companies would not be aware of their current financial position, as well as the transactions that occur within the company.

PAYROLL SERVICES

Processing payroll can be a complex and time-consuming task for any manager or human resources representative. It requires meticulous record-keeping, comprehensive tax knowledge, extreme attention to detail and efficient work habits. However, payroll services reduce the amount of manual responsibility and time needed to process payroll. In this article, we discuss what payroll services are, how payroll companies work and the benefits of payroll services.

What is a payroll service?
A payroll service is a third-party company or organization that assists with payroll processing. They simplify many things associated with timely and accurate payment, such as:

• Employee time and attendance
• Workers' compensation
• Payroll taxes
• Direct deposit information

Modern payroll services offer more than standard payment delivery. They act as a complete payroll management option for businesses of all sizes across all industries. Here are some things a payroll service can help with:

• Tracking employee attendance
• Collecting wage and time information
• Calculating wages
• Monitoring workers' compensation premiums
• Keeping electronic payroll records
• Following federal and state laws for payroll
• Calculating payroll taxes
• Preparing and mailing employee tax forms
• Setting up, adjusting and making direct deposits
• Integrating third-party benefits into payroll

Some payroll services also provide additional human resources support for employers. However, the overall goal of using a payroll service is to guarantee that every employee receives the correct payment amount on time, every time.

FINANCIAL STATEMENTS PREPARTION

Business executives, shareholders, potential investors, and auditors all have good reasons to continually evaluate the financial position and performance of a company, but how do they do it? The answer is by reviewing financial statements. The income statement or profit and loss statement, the statement of retained earnings, and the balance sheet comprise the "big three" financial statements. A company's accounting professional typically prepares financial statements to give a clear picture of the company's financial position at a specific time. It is important to understand the framework for the preparation of financial statements through reviewing samples and an explanation of the steps of how to prepare financial statements.

Financial Statements Overview

Financial statements are the business world's equivalent of a medical check-up. They offer a comprehensive overview of an organization's financial condition, including details about its profitability, cash flow, and overall worth.

There are four types of financial statements, each with a unique purpose:

• Income statement: An income statement is a summary of your company’s financial performance. It shows the revenue, expenses (including taxes), and profit your company generated over a specific accounting period.

• Statement of changes in equity: The statement of changes in equity (SOCE) - also known as the statement of retained earnings or statement of owners’ equity - gives a detailed account of how shareholders’ equity has changed over time. Equity can change for various reasons, such as adding or withdrawing capital and paying dividends.

• Balance sheet: The balance sheet shows what the company owns (assets), owes (liabilities), and the stake held by shareholders (equity). Think of it as a snapshot of your company’s financial condition on a given day.

• Cash flow statement: The cash flow statement summarizes cash inflow and outflow. This statement is especially important for startups since many of them go out of business due to their inability to manage cash effectively. Even if you’re profitable, you can run out of cash — profit generated during a year does not equal cash generated during a year.

Each one of these documents gives stakeholders such as investors, creditors, employees — even competitors — valuable insights about where a business stands financially.

INTERNAL AUDITING

It is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.

Performed by professionals with an in-depth understanding of the business culture, systems, and processes, the internal audit activity provides assurance that internal controls in place are adequate to mitigate the risks, governance processes are effective and efficient, and organizational goals and objectives are met.

Evaluating emerging technologies. Analyzing opportunities. Examining global issues. Assessing risks, controls, ethics, quality, economy, and efficiency. Assuring that controls in place are adequate to mitigate the risks. Communicating information and opinions with clarity and accuracy. Such diversity gives internal auditors a broad perspective on the organization. And that, in turn, makes internal auditors a valuable resource to executive management and boards of directors in accomplishing overall goals and objectives, as well as in strengthening internal controls and organizational governance.

TYPES OF INTERNAL AUDITS

Compliance Audit

A company may be required to adhere to local laws, compliance needs, government regulations, external policies, or other restrictions. To demonstrate compliance with these rules, a company may task an internal audit committee to review, compile appropriate information, and provide an overall opinion on the status of the compliance requirement.

Internal Financial Audit

Public companies are required to perform certain levels of external financial auditing where a completely independent third party provides an opinion on the company's financial records. Companies may want to dive further into audit findings or perform an internal financial audit in preparation for an external audit. Many of the tests between an internal or external auditor may be similar; the nature of independence separates the two types of audits for financial audits.

Environmental Audit

As companies become continually more environmentally conscious, some take the steps of reviewing the business' impact on the planet. This results in an internal audit covering how a company safely sources raw materials, minimizes greenhouse gases during production, utilizes eco-friendly distribution methods, and reduces energy consumption. Companies leveraging triple bottom line reporting may perform internal environmental audits as part of annual reporting.

Technology/IT Audit

An IT audit may have different objectives. The internal audit may be the result of an external lawsuit, a company complaint, or a target to become more efficient. An internal audit focused on technology reviews the controls, hardware, software, security, documentation, and backup/recovery of systems. The goal is likely to assess general IT accuracy and processing capabilities.

Performance Audit

An internal audit focused on performance pays less attention to the processes and more on the final result. The company will have likely have set performance objectives or metrics that may be tied to performance bonuses or other incentives. As a result, an internal auditor assesses the outcome of an objective that may not be easily quantifiable.

For example, a company may wish to have expanded its use of diverse suppliers; the internal auditor, independent of any purchasing process, will be tasked with analyzing how the company's spending patterns have changed since this goal was set.

Operational Audit

An operational audit is most likely to occur when key personnel leaves or when new management takes over an entity. The company may want to assess how things are done and whether resources are being used more efficiently. During an operational internal audit, the auditor will review whether current staff and processes fulfil the mission statement, value, and objectives of a company.

Construction Audit

Development, operating, real estate, or construction companies may perform construction audits to ensure not only appropriate physical development of a building but appropriate project billing along the life of the project. This mostly includes adherence to contract terms with the general contractor, sub-contractors, or standalone vendors as necessary.

This may also include ensuring the company has remit the appropriate payments, collected the appropriate payments, and internal project reports regarding project completion are correct.

Special Investigations

Many of the audits above may be recurring and performed each year. In some cases, it might make sense for an internal audit committee to evaluate a special circumstance that will occur only once. This may entail gathering a report on the efficiency on a recent merger, the hiring of a key employee, or a complaint from staff. When selecting the individuals for the special investigation audit, a company must be especially mindful to select members with appropriate expertise and independence.