Monthly Archives: March 2022

For an accounting firm like us, it is of utmost importance to follow procedures, guidelines and best case practices to serve our clients the best way possible so that the client will be able to focus on their own business growth.

For a business to be successful, managing the businesses’ accounting & finances are the most important pillars to make profits and to be sustainable for the long run. Most businesses don’t give a proper focus on their accounting processes which directly affect failed business decision making which transcends to stagnation or failure of their business overall.

1.We assign a dedicated Finance manager

As the initial with the client, we take a good amount of time to understand the client requirements and needs as well as expectations. We understand that each client is different and each client has their own set of problems to solve and we take that customized approach for all of the clients so that we can give the best service possible.

2.We assign a dedicated Finance manager

Once, we understand your business, requirements and needs. We provide you with a dedicated Finance manager to carry out all the support needed as well as to communicate among both parties.

3.Setup the accounting system

According to the business and the best possible solution, we provide and setup the accounting system for your business with the most up to date world’s leading accounting software and tools.

4.We will assign a dedicated Accountant

We provide our experienced and talented and dedicated accountant to start processing and updating your business transactions as per your requirements, it can be live, daily, weekly or monthly.

5.We setup the chart of accounts

We take pride in setting our tailor made chart of accounts as per the business requirement and the relevant processes required.

6.We implement the report layout setup

Monthly reporting is a must for any business and we create monthly management reports in the best possible way for the business owners and the decision makers to understand the business and to make better business decisions based on the analysis and facts. We customize and implement the necessary reporting layout for your business.

7.We will do the reconciliations

We will be supporting you to reconcile your bank statements, customer statements, supplier statements, VAT returns and compliance requirements and many more.

8.Finance meeting

During the finance meeting the Finance Manager will review your business performance and will communicate to you to understand what has happened, where it is gone good or bad and what should you do next while guiding you all the way to make your next strategic plan for the upcoming month.

KLOUDAC Global

KLOUDAC Global is a dedicated expansion of KLOUDAC, a recognized accounting firm with branches in Dubai, London & Colombo with 15 years of service experience. KLOUDAC Global mainly focuses on back office accounting with a whole package of services such as Financial Consultancy, Business setup, Audit and assurance services, Taxation services, Recognized accounting software, and more.

Improving cash flow can be a challenge for businesses, but fixing the missing links can help you take out the stress and gain some financial breathing room. Without money on hand, you can’t make payroll, cover your bills, or pay your taxes. 

When we talk about cash flow, major focus should go to accounts receivable and accounts payable as these two areas can give serious blows to your working capital potential. It needed a proper focus and an action plan to be dealt by the business.

Accounts receivable

Accounts Receivable is the proceeds or payment which the company will receive from its customers who have purchased its goods or services on credit. Usually the credit period is short ranging from a few days to months or in some cases maybe a year.

So many small and medium businesses must always be wary of raising Accounts Receivable which can inevitably come to create cash flow problems. So if you are a business that is looking to improve your cash flow and optimize the working capital, the first step any business can take is to get rid of suboptimal Accounts Receivable practices that usually lead to mismanagement of Accounts Receivable.

Accounts Payable

When a company purchases goods on credit which needs to be paid back in a short period of time, it is known as Accounts Payable. It is treated as a liability and comes under the heading ‘current liabilities’. Accounts Payable is a short-term debt payment which needs to be paid to avoid default.

Main bad practices to avoid when managing cash flow

1. Adopting an inefficient customer credit approval process which ignores payment terms and conditions.
2. Lack of standard invoice/billing process such as price, units, purchase quantities, customer accounts to be some of the common areas where mistakes can happen.
3. Lacking a master database of customer data due to lack of updated information or misinformation is a most common Accounts Receivable problem. 

Good practices for optimal cash flow improvement

1. Study your cash flow patterns to identify trends and create a plan to best prepare for the future.
2. Maintain a cash flow forecast document or a visualization.
3. Businesses must set out clear and concise policies on credit approvals and extensions. Separation of duties between finance and sales personnel must be established.
4. Negotiate quick payment terms with other parties as suitable.
5. Reduce the risk of unpaid invoices by adding late payment fees. Be sure to clearly highlight the late payment penalty in the initial customer contract and again when you first invoice, explaining what the fee is and when it applies.
6. Check your accounts payable terms (cash outflows) and see how long you can wait on payment
7. Assess credit limits regularly and establish timelines for credit applications.
8. Review the credit approval process and make necessary tweaks based on the market conditions, and risk profiles. Consider options to grant credit approvals for limited time periods if necessary.
9. Automate the invoicing or billing process to reduce human errors and time costs.
10. Centralize all the data on one standard platform with all the customer information – addresses, payment information, purchase limits, payment terms, discounts, credit terms and more.
11. Cut unnecessary spending such as extra office space, unsold inventory, costly employee phone plans.
12. Consider leasing instead of buying to make smaller payments that don’t eat your cash reserves.

By creating a standard credit approval process, businesses can handpick the right clients to reduce Accounts Receivable problems by a mile. Having a standard customer master database helps Accounts Receivable resources to reduce errors and follow-up the client better to further improve the cash flow performance.

KLOUDAC Global

KLOUDAC Global is a dedicated expansion of KLOUDAC, a recognized accounting firm with branches in Dubai, London & Colombo with 15 years of service experience. KLOUDAC Global mainly focuses on back office accounting with a whole package of services such as Financial Consultancy, Business setup, Audit and assurance services, Taxation services, Recognized accounting software, and more.

The back office of a business represents any administrative or financial services that support a company to run on a daily basis to manage its operations.

What is back office accounting?

All companies need some form of financial management to support their normal business operations. Back office accounting is the financial management of a company that essentially works behind the scenes. The accounting tasks are the same as other companies which normally include accounts payable, accounts receivable, payroll, and inventory management as such. 

Like all accounting systems, back office accounting needs to have logical processes in place. This includes a process to capture specific information for financial management, activities in place to record transactions into ledgers, and a manner into which a company puts together financial reports. Without these processes in place, a company may wind up not knowing anything meaningful about its financial activities. Monthly reporting is often a goal for all accounting systems in a company.

Why should a business outsource back office accounting?

Companies may be able to outsource back office accounting to a third party in order to focus on their main business goals. Hiring accountants or bookkeepers on behalf of the company for basic back office accounting tasks can be a way forward and a one solved problem for small and medium scale business owners as they can focus on managing operations and creating shareholder value for their business.

Areas to consider when outsourcing back office accounting

Your accounting tasks rob a major share of your time

Most of the time businesses end up having so much to do with operations, sales and other front office activities with  so little time while they forget about managing the finances right.

You encounter delays in accounting

When the entire accounting work is dependent on a specific group of resources, then there is a high chance of encountering delays.

You face consistent accounting errors and mistakes

Overworked resources, multiple roles and responsibilities and lack of solid segregation of duties are common causes of consistent mistakes in accounting and bookkeeping.

You run into frequent audit problems

More often than not small and medium businesses do not completely leverage the available tax breaks and opportunities due to lack of time, expertise or both, which is understandable. However, if your business is facing problems with right tax documentation for an IRS audit, then it is a sign of problem and also an area of improvement.

You are scaling your business

Simplest sign of potential accounting errors or problems is a business that is scaling. It is a relentless hassle that requires more focus and preparation for the volume of work it demands. Accounting tasks are sure to pile up and without adequate resources, a business may not reach its full potential and worse, may screech to a halt.

Outsourcing accounting services as a whole or seeking assistance for specific accounting services surely free up time, resources and help the business focus more on growth. So if you are a business that is encountering any of the signs above then it is high time to hire an expert remote accounting firm like Back Office Accountants.

How to outsource back office accounting?

When a small or medium business cannot continue its accounting in house, an option may be to outsource back office accounting practices to a third party. Hiring a local bookkeeping company can fulfill this service. Larger organizations may be able to outsource accounting services to international companies. This is not only inexpensive, but it also removes the need for maintaining offices in its main location. Outsourcing needs to be significantly cheaper than hiring and maintaining accounting staff in the local area.

KLOUDAC Global

KLOUDAC Global is a dedicated expansion of KLOUDAC, a recognized accounting firm with branches in Dubai, London & Colombo with 15 years of service experience. KLOUDAC Global mainly focuses on back office accounting with a whole package of services such as Financial Consultancy, Business setup, Audit and assurance services, Taxation services, Recognized accounting software, and more.