Managing Cash Flow - Easier Than You Think

Did you know that the most common cause of failure is taken by small businesses, lack of cash operating costs? This happens because of poor cash management. Let not this happen to you. Apply minimize the control and manage your cash effectively to the risk of failure. To do this, you have two bases of the Cash Management: Cash and cash flow to understand.

o Cash - In this context, what is meant in the actual amount of cash available funds in the bank or is> Company. It does not include inventory, it is also not included demands such as real estate or investments. Although this potential to make money, they are not liquid, and therefore can not be called money. In other words, cash is what you use now to pay the bills and run your business can.

o Cash Flow - This refers to the movement of cash within and outside a company. rubles roll is what you want from customers, lenders and receiveInvestors. Entertainment refers to the cash payments you make each month for salaries, supplies and interest payments to creditors. If the cash inflow exceeds the outflow, a company has a positive cash flow. A positive cash flow is a sign of good financial health. In the opposite situation, a company will say in a negative cash flow, a problem for the least to have!

How do you beat that? To begin with, developing a cash flow projection. This should be a dual project - short term (with a weekly ormonthly periodicity) cash flow projections to help manage daily cash needs, and long-term (between one and five years) to fund the cash-flow forecasts higher on your business needs.

For small businesses, the need for a cash-flow management is to be avoided in the first place, extended cash shortages, a common occurrence in expenses for the purchase of materials, payment of license or permit fees and wages may have to be made before the company paid by the customer is.

How canClose this gap cash flow and keep your business solvent? Shorten your cash flow conversion period of the following 5 easy steps that can help to accelerate their money:

1. Collect payments without delay - send your invoices goods are shipped the same day, not one or two weeks later. Enter on your account if the payment is due, and enter the penalty interest for late payment.
2. Track accounts that are overdue - active unpaid bills. Call the company and sendMemories let them know that their account is overdue and the steps that they should not follow are going to pay.
3. Cut costs as much as possible - Take a close look at the cost of the column on the cash flow chart. If all costs are included in this column really necessary? Are there things you can do without? Is there anything you can find a cheaper offer? Answers to these questions will probably end up saving quite a few dollars.
4. Not account for people to pay on time --Remember not to pay people on time. In fact, they have more than once that the payment is to be remembered. In preparing the cash flow forecasts taking into account the fact that it usually takes people to pay more than you think. If you're a long period with credit cards, communications with the company for at least four weeks before the bill is due to make sure it will be paid on time. You can even your customers a discount for paying their bills early.
5. Project, a"Underestimate the worst-case-scenario, exaggerate" - Always your expenses and your income. This way you can be prepared in the planning and liquidity constraints.

To keep your business up and running, you have money coming in regular intervals. All of your cash flow so you can accurately predict potential problems and take steps to remedy the situation.

Ex Dividend Date and Dividend Investing

Many companies reward their shareholders for holding the stock, by the payment of dividends. This is especially true for blue-chip faithful. These often generate large profits, and select that distribute the wealth of the company owner. Smaller outfits often pay no dividends, since they make money for various purposes including the need:

- Expansion through mergers and / or purchase

- Balance sheet consolidation (land capital so that the financial statements) look good.

But it isnot the exclusive domain of smaller companies to withhold payments. Behemoth may also decide that the dividend payments do not suit their business model or simply is not appropriate because other variables (such as input costs). An example is Warren Buffet's Berkshire Hathaway. Mr. Buffett is considered one of the greatest investors ever, and he takes most of its activity by this company. Berkshire is in the game of investing in or swallowing other companies in terms ofTurn them into lean and mean machine money making. Thus buffets logic that shareholder value comes from adding value through out-performance of the company. Fair enough.

When you invest like the idea of investing in dividend paying companies - a form of income - there is a date that you need to look out for. It's called the ex-dividend date. Decision-makers regularly gather to prepare or sign off on accounts and decides on the appropriate dividend payments. DependingCompany performance and economic conditions will be announced that will pay a dividend to all shareholders on the books at the Big Day, which is the ex-dividend date. If you buy stocks, a day after that date, you will not lead to a dividend payment in respect of these. When you buy shares before the day, you are entitled.

The practice of buying shares a few days before the ex-dividend date and selling the same shares for about the same price a few days after theDate will invest as a "dividend. The Company is obligated to pay dividends, even though the shares, how to sell the Company held on the day. This activity can sometimes explain why a stock (no messages on the back) came on The ex-dividend date, and then set again to climb down. Such shares transactions are legitimate, and I am sure that many investors make money. But there are risks.'s stock price, which the investor tries to the shares after the salehas expired, may be lower than that obtained in the shares. Therefore boom is far better than bears. In addition, exchange rate movements and transaction costs (eg commissions) must be taken into account at further risk the possibility of missing positive share price movements.

The investment style, those who do not want to commit to long-term capital to buy suit-and-hold kind of transactions. There are also sure to satisfy the specific time with the network feeds and other sources RNSCompanies collect information, including all major ex-dividend date list. Whatever your personal preference is there another variable must be careful when investing in the stock market.

Agency Valuation is an Art, Not Science

Estimation, benchmarking, or an agency in the value is typically one of the three main reasons:
(1) determine the market value, in preparation for a takeover or merger;
(2) for the solution of true ownership value for purposes of changing equity positions, whether they imagine for a buyout, succession planning, ownership disputes, or a new partner, or
(3) for the edification of the owners of what may be the current market value of his farm.

Certainly, there are otherTo receive reasons for a review, but to those set forth in touch on the primary objectives and to understand, value beyond the agency.

In general, the evaluations, a careful mix of actuarial science, micro-and macro-economics, the core financial and business entities should also rolled up in an analysis. Often, many of the above principles are omitted and not carefully evaluated during the assessment of the value of the agency. There have many experts, the assessment, but fewto understand clearly that the momentum must be included if within the insurance industry.

Agents and agencies, as service providers offer countless intangible value. Intangible assets are almost always far from the assets of an agency, is to determine why this value is an art form. Valuation of intangible value is more subjective and requires insights from professionals who know well the variables and dynamics of the insurance industry. Generalists whoValue is everything from car dealerships and manufacturers to hospitals and retailers, sometimes lack a correct understanding of a niche business, which is continually developing. They just want the science aspect of the evaluation of the agency without any real idea of what our industry concerns deal.

Valuation experts generally employ one or two different methods in the assessment of many companies. The most common are: (1) conversion of income,which is determined by applying the rule several times to normalized earnings, figure, to develop the value, and (2) discounted future earnings, which have a present value of future profits-nineties. Many times, the evaluation will be both professional methods used to identify areas. You will usually receive data from an industry publication, for its own use and inflationary indices, think of the future growth rates, and put their numbers into a spreadsheet that spits out an evaluationTo report. This type of reporting seems to be no real understanding of the industry, specific market trends, to do and not to bring true value of the Agency to the forefront. The owners are lead astray, and sometimes, in the negotiations on the sale of their life's work, are wrong. They can not and should not always trust your agency's value by only a calculation engine that measures risk-free rate, the U.S. Treasury rates, or any other publication of indexes to serve as the underlying value of the computer. This reducesTheir hard work into a commodity. This is not to say that the published indices are important, but that it must be much more considered in an assessment. Agency owner should always be suspicious Web sites or valuation firm that the most important figures in their tables drop, which in turn allow for follow-on the spot. According to this view, the value of your agency, as if in a large pool of homogeneous firms. Each agency is different and should be assessed in arecognized that the unique properties. The quick and dirty reviews always cost less money, but in the long run, they can be misinformed, the agency owner. If this type of evaluation is used as a bargaining tool or a partner for guidance, it may possibly result in the owner (s) to leave money on the table in some way.

We should expand our understanding of the true value of indicators for the Agency's current owner. Value can be broken into two separate categories of economic value andintangible value.

The true economic value used quantifiable dollars into the assessment. The result is that there is always attributed to a specific dollar value on a certain revenue, contracts or property. . Goodwill and intangible value is therefore more subjective, but still critical value of the agency. Outlined are some examples of the primary economic and business goodwill value of the key indicators of an agency:

Recurring Revenue - This is a critical element involved, and should be createdas part of the assessment. An evaluation of the estimated power business by political year, retention or persistence, and future Commission creeks are a must. They show clearly liquidation value of the pension agency owner (s).

Distribution relationships - This refers generally to exclusive, long-term sales contracts to cover the production of a particular regional or national source. While this can also be as a goodwill value indicator, economicvalue is a value that can be attributed to the contract. Note that buyers usually pay a higher multiple for an exclusive distribution relationship, because it puts potential synergy value to them and they should show more consideration to serve on the mission. The longer the duration of the contract, the greater the benefit to the agency owner.

Production and aggregation of agency compensation agreements - The ability of an organization to the highest level of production to achieve basicCompensation Commission or contingent, will surely value. From an economic perspective, this could be a possible improvement acquirer portfolio of carrier relationships, especially if the agency has a unique relationship, the institution regulates top-level compensation. This can sometimes be taken into account to create a huge synergy value in the market and needs.

Operating Proficiency and profitability - The ability of an organization to provide the scalability, operational knowledge,and total return on revenue is an important economic value creator. An evaluation of the pending inventory, cases, or the allowance provided by the staff reductions are key metrics that can add value if the result is reflected in line expertise. Even a company that ability, fluent with the ebb and flow of traffic through the use of appropriate case processing staff can really increase value-added work shows. It is equally important for experienced personnel who can work in a potentially corrosiveEnvironment. If an agency has the ability to grow quickly in a position to efficiently manage its work processes, profitability and returns on a per unit, is significant, it is worth the added business. Finally, an agency that has been above the industry average loss experience, and has a well-drawn book of business "presents itself as a much more attractive on the market. This is a key element to economic benefits to many stakeholders and should be addedbe taken into consideration in the analysis.

Technology - The use of technology can be a double-edged sword. Value is created when an agency is capable of an efficient, cost-effective delivery, systematic approach to its operations. The value will be further strengthened if proprietary or unique applications such as Web technology application, to taking, status, rating or underwriting is used. These improvements add to the company. It is important to note that companies that pour money down a hole for technology andDevelopment serious burn rates and no return on their investment is extremely difficult to assess added. Many companies in the dot-com parade and built their own IT infrastructure can not add value, without any clear idea that they are something unique, it provides economic value and / or that it is strengthening its business in any way. Unfortunately, many homeowners fall prey to the "no hire purchase" and "technology and are still paying theprice.

Internal Growth Rate - Historical growth rates are also important at adding value. If the agency management can navigate through market cycles and demonstrate the ability to continuously add new business through new products, carriers and distribution, this adds significant value to the company. Trending is very important and if an agency can weather the storms of the market, they reap the additional value.

Product margins - Another key issue is the net retention of the agency on a per unit. What is the Agency's receipt of gross income and what is it paid to acquire its distribution to the revenue? This is an assessment that is a big difference, especially to make if an acquirer may perform the evaluation of the company. If the agency quickly new sales and demonstrate top-line growth by aggressively adding the payment of compensation, it can actually be subtracted value. This represents a scenario in which a buyer will be forced to lower compensation,paid to producers for the pitch on a net commission, post-transaction level. The buyer will certainly see this as a high risk move. The buyers are generally suspicious of agencies that the lion's share of compensation from the producer and survive thin margins and inferior service. The best model is that a good liquid growth shows an unbeatable service.

Company structure - whether you believe it or not, this is also a crucial factor. Sub Chapter SAcquiring corporations, partnerships and limited partnerships, present a greater financial benefit to the market. Traditional Company C can buy because of the tax implications of stock that may adversely affect the market value of an agency. Essentially, buyers have a rule to the deduction of depreciation on a C-Corporation, so that Seller may waive capital gains treatment to win. There are numerous tax provisions that this question can be better determined by a control surroundSpecialists.

Size and diversity or niche - first this may be contradictory, economic value is added when an agency is found residing in a particular niche. Especially if it's proprietary product offerings or they have a form of exclusive rights to certain distribution channels or carriers. Even an agency that can offer a wide range of products to show the ability to counter-cyclical or at least has the opportunity to ride the market downturn because of its diversity. This allowsthem to market risks through a variety of products and carrier relationships. Agencies to complete raw material base and stay in easily accessible markets generally hold the least value.

Operating Model - An agency, which shows a boutique environment, or one that provides "high touch" service and get more and more considered evaluation. This apparently means that customers greater penetration among producers, better product filings and Awardsof airlines and other industry professionals. The translation is always lower marketing costs, better technical results and improved financial metrics within the agency.

Concentration of production - This is always a great value deflator and also depends on the size of the facility. Price is discounted agency, if the production heavily weighted to a particular carrier or from a few sources. This poses a risk that the agency may suffer significant economic damageExtract from a production by source or by the cancellation of a support contract. A single production or source should never be more than 25 percent of operating an agency revenue.

Brand Name Recognition - An agency that has a name the industry provides a great deal of goodwill value. If the agency is slightly in the industry on the name on fixed or their clients, it really solidified its presence as a stalwart. Agency, owner orAdministration, which is regarded as industry luminaries and recognized throughout the industry further strengthens intangible value.

Management depth within an agency is another important factor value. All major areas of agency operations, which are represented by industry professionals is still very significant value. All these translate intangible to an important point: The agency is well grounded, stable and has genuine concern about going value.

These indicators are a part of this landBe produced which, if you need the value of an agency. Never trust a Web site to calculate the engine or spreadsheet template won the reasoned value of your company. An insurance company can be a gold mine of value that should not to the level of an automobile appraisal will be reduced. Agency owner and principles, many of whom spent a lifetime building their businesses, should only experienced industry professionals who rely on the time to understand clearly onall facets of operations, and can take off, or you can optimize the value of the company.

Believe it Or Not You Have Been Had!

The impact of fraud can be felt in our economy. Tax fraud can mean higher tax rates and \ or reduced quantities of services for the citizens receive. Business fraud can lead to higher prices for consumers to call value destruction for shareholders, lower profits and low quality of products and services, to name just a few examples .

Fraud can also affect small firms by funneling cash and assets from the business and possibly the increase in liabilities (income taxFraud). Just as a small business owner can spot a potential fraud cases? A red flag for small businesses is a series of circumstances that are rare in nature and varies from "normal" activity of the workers. Business owners should understand what is normal activity in order for their employees, what un-normal activity understand is. In addition, each operator should investigate red flags to identify the reason for the unusual circumstances. Too oftenEntrepreneurs get too busy to investigate the red flags, or one on the dependence of trust. During the investigation should understand the business, if the abnormal transaction was a mistake, or if the intention was to cheat. As explained Dennis Dycus, CPA (an expert in fraud): "Fraud and stupid often exactly the same."

According to Dennis Dycus, CPA, fraud occurs when three ingredients are added. The ingredients are necessary to rationalize and opportunity.Small business owners) can control the environment (opportunity. Small business owners tend to have low internal controls, based primarily on trust. The number one reason fraud occurs, is a blind trust. Trust is good, but as the old saying goes: "Trust, but verify."

As stated in the article "What Is Your Fraud IQ?" by Andi NcNeal, CPA, CFE: "Placing a considerable amount of trust in employees is part of the cost of doing business. Trusting employees to accessInformation that is, products, suppliers and resources for the implementation of an effective and efficient operations. But some people, when confronted with enough pressure, a perceived opportunity, and the ability to rationalize a crime, the advantage that confidence to take and deceive their employers. "Good and ethical people can be a criminal offense in the words to rationalize itself is ok (I work hard, I'm underpaid, I will repay the loan, etc.)

If trust is the only (or one of the few) internalMonitoring, employers should remind employees of the internal controls to avoid it, because in order to facilitate their task, but here is the opportunity for fraud is available. An employer could not put a stop not on internal controls, since the Employees listed are the new efficiency, or that they are too busy to make the correction. This can be a dangerous door to open.

The man is a man. Sooner or later the people will have to be a need, and they will rationalize the reason for the fraud (the firstand second ingredients fraud). Please note that overtime and weekend work, which they have not been paid? Remember how they are underpaid?

Good and ethical people can rationalize cheating. An employee of the demand is usually financially motivated (spouse work, medical expenses, debt pressures, etc., laid off). The employee typically will rationalize the fraud by stating that they pay the money back or they will deserve it because they are poorly paid, etc.

What kind ofEmployees should have red flags, the employer? Some red flags should make the employer an employee include changes in lifestyle, an official with personal debt and credit problems, changes in behavior (drugs, alcohol, gambling, affairs, afraid to lose their job, etc.), a high turnover, refusal , vacation or eating sick, lack of separation of responsibilities and duties, low or inadequate levels, difficulties in obtaining audit evidence, severe disciplinary action, lack ofRespect and appreciation by superiors and resentment for not treated fairly. I think it is fair to assume that employers employees with at least one of these red flags.

The employer finds a red flag or three, now what? The employer should analyze the flag. If the transaction caused by error or fraud? Is there a history of similar transactions? Does the employer understand the transaction? If the employee understand the transaction? If the right internal controls inPlace? Trust is enough? If there is no fraud, the employer should understand the warning?

How can an employer create an environment hostile to fraud? Management must set the tone for the organization. These actions speak louder than words in a manual (especially if the words and diagrams) are not followed, that is, management must be preceded by example. Management should follow the internal controls, not to circumvent the work done faster. Management should walk, talk and listen,Employees. Management should take the floor and you see your people in action. Are they really following the rules? Management should talk with the staff to find out what is really behind their backs and get information about employees personal lives. Management should be on the lookout for action from the normal work of an employee's lifestyle of their employees, dress code, privacy, personality, etc.

Small business has created a ripe environment for fraud. They createdan environment based on trust. Combined on the dependence of trust with today's difficult economic environment in which employees more worried about their personal finances, and you have the potential for fraud.

References:

What's Your Fraud IQ? By Andi McNeal, CPA, CFE, Journal of Accountancy September 2009

Recognizing fraud and creating a hostile environment for it by Dennis F. Dycus, CPA, CFE, CGFM 2009 South Eastern Accounting Show, 26 August,2009

How to Start an Errand-Running Service 1-2-3

If you do not have any special skills or experience, you can still make good money running errands for other people. Under a contract running business is not a bad deal, either. Do you like to work "out of the office", since on the move and a constant change of scenery? Errand could be executed the ideal business for you without the headaches of long-haul.

You do not need much funding or equipment-wise to start - a car is ideal, but actually aBicycles may be able to handle jobs too well. If you have a truck or van, you increase your job options, and prices you can charge. By the way care can be executed, a handy part-time business.

Another advantage is not just an errand-runners is that your client actually is growing. People's busy lifestyle with the growing baby boomer group together makes errand runner in high demand. The companies will also save outsourcing, money - running your company can contractalso benefit the company. In fact, you have so many potential customers, it can on where I start overwhelming. Consider a supply service to pharmacies, clinics, shopping assistance for the elderly, take-out service for restaurants, transportation packages for companies and run other errands for parents, to name a few.

From hour to hour, you can charge for your errands, but do not forget to include on your mileage account costs, or add it to your hourly rate. You candecide to offer discounts to attract regular customers, they will rent for more assistance. If you do, you can opt for "emergency" service, or work in the short term, you can also raise prices.

And where do you find your customers? The best way (can not) not to mention cost in network with people you know or print business cards and leave them at the bus stop facilities such as local cleaning, garden centers or nursing homes are older. Meet with entrepreneurs,Restaurant managers and doctors' offices to explain your business, and how to save money. Print out one of the services they offer again, along with your prices, opening times, contact information and references. In this way they can use the information after they meet with you to keep, and the first impression you make is a professional and organized.

Treat your customers with reliable, timely service, and you'll have a hard time getting rid of. To spread word-of-mouth advertisingvery quickly, so this "marketing" strategy to use to your advantage by using the extra mile for your customers.

So how do you actually start your errand running business?

1. Get to know your local community - geographically. Short-Cuts can really help. If you want more detailed start-up instructions, take a favorable start-up guide on how to run business or a job interview with an already successful business or errand runner, you can begin to giveAdvice.

2. Find out who your customers. What tasks have to make people fear in your area? What additional value they offer and how much they are willing to pay you? See what other companies are charging for similar services. Note that you do not have the lowest price to win customers - as long as you provide more value (ie, additional service options, faster service, weekend or evening hours to contact, etc.).

3. Find out what permits or licenses required by your State office. Talk to an accountant, insurance agent and banker (you can get referrals from other local employers or friends) to get helpful tips on financing, taxes, insurance and corporate governance, you save time, money and hassle in the long run.

Get Started!

An errand running business really, you can start small and grow at your own pace. Learn how you and go your own rules - after all it is YOUR> Company.