New Mexico Broadband ProgramInternet Tools for Small Business Success Module 3 Accounting and Finance
Internet Tools for Small Business Success Class Series • Terminology & Planning • Communication & Collaboration • Accounting & Finance • Intro to Online Marketing • E-Newsletters • Websites & Blogs • Search Engine Optimization • E-Commerce • Intro to Social Media Marketing • Facebook & Twitter • Social Media Administration • Linked In
Primary Business Components • Planning • Operations • Accounting & Finance • Sales & Marketing • Hiring Accounting & Finance Operations Planning Management & Hiring Marketing & Sales
How This Class Works Terminology Discussion & Demonstrations Hands-on Exercises
Class Framework • Divided into Core Business Elements • Internet Tools for each Element • Terminology • Realm of tools • Choosing the right tool for your business • Getting Started
Today’s Class Goals • Understand the terms bookkeeping, • accounting, and finance • Learn ways to finance your business • Understand the benefits using online • accounting tools • Explore local resources for financing
Terminology Accounting The systematic recording, reporting, and analysis of financial transactions of a business.
Terminology Bookkeeping Keeping records of what is bought, sold, owed, and owned; what money comes in, what goes out, and what is left.
Bookkeeping versus Accounting • Bookkeeping - systematic recording of the amounts, dates and sources of each revenue and expense transaction • Accounting - the bigger picture. It is the system that tracks data, including people, and records the transaction's history. It also uses bookkeeping information to analyze the business’s financial circumstances.
Other Terminology • Start-up capital – resources needed to launch a business • Break-even – when revenues equal costs • Cash flow – the movement of money in and out of your business. • Profit and Loss Statement – adds the revenues and subtracts the operating expenses, leaving the profits. A profit and loss statement measures the results of operations over a given period of time.
Why use Online Accounting Tools? • The software is always current • No need for IT support • Data automatically backed up • Ability to access from numerous locations • Ability to access from any computer, Smartphone, or iPad
Types of Online Accounting Software • Simple Electronic check book www.quicken.com , www.outright.comhttp://www.youtube.com/watch?v=By6Zhk5IGoA • Basic Payroll, receivables, basic inventory system www.quickbooksonline.com • Standard Audit trail, multiple users www.Peachtree.com, www.quickbooksonline.com (Quick Books Pro) • Advanced Purchased in modules, financial reporting, job costing www.greatplains.com
How do I choose the right one? • Determine your needs • Be financially literate • Talk to your accountant or CPA • Know your Budget • Talk to your IT Department • Find out what similar businesses are using • Determine your projected growth • Create a wish list of features
Terminology Finance A discipline concerned with determining value and making decisions.
Financial Information Helps you to: • Price your product • Know if you are making or losing money • Know your cash flow • Work with bankers and investors • Make informed business decisions
Resources for Financing your Business • Personal savings • Family and Friends • Bank line of credit • Commercial loan / Small Business loan • Strategic Partners and Customers
Resources for Financing your Business Local and Regional organizations that can help: • www.accionnm.org • www.wesst.org • www.financenewmexico.org • www.nmsbdc.org
Financing Planning To start a business you need to understand what your business’s initial cash requirements will be. Calculate: • one-time start-up costs • working capital 12-24 months • a reserve
Calculate Start-Up Costs Use your handout and follow the directions to begin calculating the initial start up costs of your small business.
Today’s Class Goals • Understand bookkeeping, • accounting, and finance • Financing your business • Benefits of using online accounting tools • Local resources for financing
We appreciate the time you spent with us.We hope to see you at the next training! These materials were created collaboratively by the New Mexico Department of Information Technology, Fast Forward New Mexico, and the New Mexico State Library, under grants provided by the National Telecommunications and Information Administration. These materials are not to be used for profit. Connecting you to a world of opportunities