SOURCE: Accounting Management Solutions

September 20, 2006 12:04 ET

Accounting Management Solutions Suggests Ways to Make Business Less Hectic

WESTBOROUGH, MA -- (MARKET WIRE) -- September 20, 2006 -- With many organizations running lean, people are doing more than ever, and many feel they are constantly tending to urgent matters. To help reduce the pressure, there are many actions everyone can take.

"Most individuals do what is necessary and urgent, which leaves a lot of necessary things undone -- until they become urgent," says Al Faber, executive vice president of Accounting Management Solutions, Inc. (AMS), New England's leading provider of outsourced accounting, financial management, and recruiting services.

"One of the best things to do between now and the end of the year is to take care of necessary tasks that never seem to get done."

Faber notes that in addition to the most common reasons individuals cite for leaving non-urgent items alone -- lack of expertise, time, or resources -- many say "If it isn't broken, don't fix it." But that, he says, only increases the list of issues that eventually need urgent attention.

Faber suggests taking the following actions to help keep the number of end-of-year urgent items under control and improve operating efficiency.

* Review year-to-date profits from a tax perspective. Nothing is worse than being surprised by your accounting firm with a large unplanned tax payment after year end. Conducting a review now will give you enough time to take action.

* Plan for physical inventory. Determine who will participate and when will it be done. This will help give your team time to prepare, whether it means closing down production or taking inventory over a weekend.

* Maintain balance sheet account reconciliations monthly. This will make year end auditing work a nonevent and help ensure that your monthly reporting is accurate.

* Review accounts receivable for bad debt. This provides another check on the business, helps avoid unpleasant situations, and, when done far enough in advance of year end, gives you time to take corrective action. Better yet, do this at least quarterly.

DO THE FOLLOWING AT ANY TIME

* Upgrade your information system. Most organizations want their employees to spend their time doing financial analysis and their IT systems do the reporting. Streamlining your system, at modest cost, can pay big dividends. Start by automating some time-consuming, repetitive processes that eat up staff time, but which don't take advantage of staff expertise.

* Look at the impact of new FASB, SEC, or tax pronouncements. Waiting until the compliance date to quantify the impact of a pronouncement may result in a last minute scramble.

* Review and address the Management Letter. Don't wait until the auditors ask what has been done to address the items outlined in the Management Letter. Review them now and develop a plan to implement positive change.

* Redo your chart of accounts. First, determine who uses financial information. Based on their reporting needs, design your chart of accounts to allow effective reporting.

* Document policies and procedures. This not only provides critical guidance to your team, but also creates an institutional memory.

* Create a financial forecast for the year. Budgets are usually done annually, but assumptions included in those budgets may change throughout the year. Review these assumptions and create a financial forecast encompassing these changes. A clearer financial picture can reduce the possibility of an unpleasant surprise at year end.

* Set recurring transactions and journal entries to automatically post. Memorizing these transactions in your system will save time and create more accurate financial reports.

* Customize financial reports from your accounting system. Many individuals tend to create the same report each month in Excel. This will reduce errors and eliminate the need to format, saving potentially significant amount of staff time.

ABOUT ACCOUNTING MANAGEMENT SOLUTIONS

Accounting Management Solutions, Inc. (www.amsolutions.net), based in Westborough, Mass., is the leading provider of outsourced accounting, financial management, and recruiting services to emerging companies and public, private, and nonprofit organizations throughout New England. Services include interim and part-time accounting and financial management professionals, Sarbanes-Oxley compliance support, and financial consulting.

Contact Information

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