The CFO'S Perspective

Accounts Receivables: Getting Paid

Accounts receivables are a hot topic for business owners because they are the primary driver of cash flowing into the company. Unfortunately, in the US 39% of invoices are paid late and 52% of businesses have been asked by clients to extend their payment terms. This creates a difficult situation for business owners because late payments not only hurt cash flow management but may also serve as an early warning sign that payment is not coming.

Typically, the longer invoices remain outstanding the less likely they are to be paid. When invoices cannot be collected on, they become bad debt and are written off, erasing the revenue they would have generated for the hardworking businesses that earned them. Bad debt hurts short-term cash flow and long-term profitability. In fact, every year an average of 4% of accounts receivable are written off as bad debt, which equates to $400,000 in lost revenue for a company with $10M in sales annually.

So, what can you do to reduce your accounts receivables problems?

Topics: Accounting Planning Cash Flow Accounts Receivable

Certainty in Uncertain Times

In uncertain times businesses need continued access to experienced bookkeepers and accountants to keep cash flowing. Whether the need is part-time, interim, or project-based, a third-party financial professional can offer the information needed to make strategic business decisions. This need does not change when people are working remotely. In fact, with so many businesses temporarily pausing operations, the need for bookkeepers and accountants is likely greater than ever before.

While the future may be uncertain, there is one immutable certainty – businesses still have access to the reputable, qualified bookkeepers and accountants that they need to keep their organizations afloat. These kinds of key personnel aren’t going anywhere and are available to help businesses navigate today’s unique challenges.

Topics: Finance Accounting Hiring Change Management Transition COVID-19

Understanding New Revenue Recognition Guidelines for Nonprofits

For many nonprofit organizations, revenue recognition is one of the most challenging accounting issues they encounter.  The guidelines governing the recognition and classification of revenue are now, however, undergoing significant change.

Topics: Accounting Non Profit Organizations Financial Reports Audit

Accounting and Reporting for Stock Gift Donations to Nonprofits

Last week I shared an overview about recording non-cash gifts and the opportunity for a nonprofit organization to accurately present the types and value of contributions it receives to support its mission. 

Today we review a related topic: Stock gift donations.

The easiest type of donations for nonprofits to accept are unrestricted cash donations. While everyone loves cash, what if you could supercharge your organization’s growth by accepting other types of non-cash gifts—like stocks?

Topics: Accounting Non Profit Organizations Philanthropy Portland

In-Kind Donations Accounting and Reporting for Nonprofits

Most non-profit organizations rely on gifts from other businesses and the public at large to achieve their goals. These come in the form of both tangible property and personal services (collectively nonfinancial gifts), which are referred to as in-kind contributions. 

Recording these non-cash gifts allows a nonprofit organization to accurately present the types and value of contributions it receives to support its mission. Even though in-kind gifts are a major source of support for many nonprofits, recording and reporting them properly can present some unique challenges.

Topics: Accounting Non Profit Organizations Philanthropy Portland