An Easy Way To Create an Employee Manual -- and Why You Should

There are myriad reasons for a small business to develop policies and procedures. Some of those reasons relate to efficiency and profitability and some have to do with legal issues. The difference between policy and procedure is that policy is the statement of what should be done, and procedure is the doing. For example, the policy may be to report all expenses on the thirtieth of each month, and the procedure may be to file each receipt in a folder throughout the month, then to fill out the expense report using the receipts.

Having policies and procedures in place, usually in the form of an employee manual, means that your company is prepared for growth. The best time to develop official company policies and procedures is before the company grows. Having a basic employee manual in place gives new employees some structure, and expectations are clear. In addition, a statement of policies and procedures can provide some legal protection for your company.

Setting aside the legal ramifications of having an employee manual, consider the efficiency aspect. When procedures are clear and followed, things are done the same time and again, giving you an opportunity to examine the results. Over time, following the same procedures will allow you to create reports and identify trends.

If writing an all-encompassing employee handbook seems like an overwhelming task, take it on in small segments. Start by simply listing what you do, as you do it. For example, the next time you make a bank deposit, write down each step as you do it. Then, the next time, ask someone else to use your list of steps to make the deposit and “test” your written procedure. Obviously, the more complicated the task, the harder this will be, but it is certainly a way to get started. Finally, keep in mind that policies and procedures can (and probably should) change. Your company will grow and change, so it makes sense that your policies and procedures should too. As you develop your employee manual, build in some flexibility, a process for change, and set specific times in advance to review the manual.
 

Tools for Budgeting

Business owners are bombarded with advertisements, introductions, suggestions, and other forms of marketing. Budgeting software is no exception. How do you decide which system will work best for your business?

Budgeting, forecasting, bookkeeping, payroll are all important when it comes to your business’ finances. Manually tracking all of those numbers would be slow and not the best use of time. However, choosing between the many tools available may seem overwhelming, particularly when there is so much marketing noise.

There are a few ways you may be able to make the process of evaluating various options a bit easier:

1. Discuss the issue with your CPA. As an expert, your CPA likely has insights into both what your needs are, and what is available. Ask for recommendations, and you will immediately narrow the list of systems to consider.

2. Decide if you want a web based or installed system. Each has advantages and disadvantages. Your situation will help you determine which is most suitable.

3. Talk to your staff. If the people who must use the software feel that their opinions have been taken into account, it is likely you will have an easier time getting it fully implemented.

As you begin to look at various systems, you will want to consider cost, technology, training and support, and your specific needs. Changing your processes will require an investment of time and effort, so carefully evaluating the options before making a decision could well save you money -- and headaches -- in the long run.

We will be happy to answer any questions you may have regarding budgeting tools.

CPA Meeting Checklist

People dread meeting with their CPA for many reasons, not the least of which is gathering the paperwork necessary for a productive, useful meeting. Here is a quick list of common documents to help you prepare for a meeting with your accountant:

Income Records - Invoices, Bank Statements, and Investment Accounts Your CPA will need all of your receipts, invoices, bank statements and investments. A form 1099-INT, which reflects your savings and interest is also necessary. Performing regular and timely reconciliations of bank statements and having a system for keeping income records easily accessible is helpful.

Schedule K-1 - If your business is classified as a partnership or corporation, you will also need to report any income or loss on a Schedule K-1. This form details individual shares of income within a partnership or corporation.

Expenses - Miscellaneous office expenses could range from supplies to travel, depending on your situation.

Mileage Miles - driven for business purposes can be claimed as a deduction. Save receipts for tolls incurred while driving for business, too!

Payroll - Documentation of employees’ salaries and wages, Forms W-2, W-3, and various forms required by the state will also need to be updated. Up to 20 Form W-2s can be created and printed on the Social Security website. Learn more athttp://www.ssa.gov/bso/bsowelcome.htm. The earnings of people who are hired for specific expertise must be reported separately on a form such as a 1099-MISC. If you are providing retirement plans for your employees, you can claim certain deductions.

Mortgage Interest - If your business operates out of your home you can deduct some mortgage interest, insurance, and some maintenance expenses -- but you must have documentation supporting all of those expenses. People who are self-employed may need to use Form 8829 to claim these deductions.

Office Rent - Expenses related to rental taxes and some utilities may be claimed if your office premises are rented.

Interest - Money that is borrowed for business activities can be deductible, if you have valid documentation showing how it was used.

Insurance - Policies for business coverage may be reported as a tax advantage -- if you have the proper documentation.