Accounting - Small Business

VCE Accounting

What is a service business? List three examples of small service businesses that you know.

Define a small business.

A small business is a usually owned by one or two owner, these owner manage and controls the business. The business usually consists of 20 or less employees.

What is the difference between a sole trader and a partnership? What are two advantages and two disadvantages of a sole trader and a partnership?

Sole trader is a business owned by the one owner whereas a partnership is where two or more owners own the business and the share is spread among the o wners. The advantages of a partnership includes a greater amount of money being used while can help them to increase the quality of services and goods. The flexibility of having one owner and therefore it gives the other owners the chance to take time off, so that he or she won’t have to worry about his or her business as there are other owner helping to look after the business, also the workload is spread.

The letter Pty Ltd stands for Proprietary Limited, this means that the business is a private company. Starting a small business have many advantages and disadvantages. Some advantages included having f ull control of the company with mean that your are able to make your own decisions without having to go through the whole process of having to go thoug h lots of people before making the decision. It is also easier to start with a much lower cost. Disadvantages includes the lack of skills and experienc es, a risk of failure as ypou have no idea if the business will be successful.

Some disadvantages included unlimited liabilities, which can cause company failure. Many disagreements concerning the running of the business.

The advantages of sole trader included the ability to make your own decisions and therefore giving you all the control and decision-making. This also l imits the liabilities. Disadvantages includes the huge amount of responsibilities which the owner holds this enable the owner to have too much flexibility.

Expert PC Repairs Pty Ltd is a local small business that repairs computers. What do the letters Pty Ltd tell you about the business? What are two advantages and two disadvantages of starting your small business as a company?

A service business is where you pay and in exchange they provide you with business. Some examples of service business includes hair dressers, lawyers and electricians.

What is a trading business? List three examples of small trading businesses that you know.

A trading business is where you pay money in exchange you receive goods.

Some example of small trading business includes, milk bars, clothing shops and florist.

What is an e-commerce business? List three examples of e-commerce businesses that you know.

An e-commerce business is where the trading is done on the internet where you pay by card and receive good. Some

Some examples includes, Amazon.com , CDS and DVDs, also Danoz Direct.

Check your knowledge – service and trading businesses.

Trading: DVDs for sale on the internet, butcher, video rental, newsagent, bakery, school canteen, milk bars, mobile phone dealer, book shop.

Service: lawyer, dentist, cleaning business, local bus company, gardener, doctor, tutoring, sporting coach.

What does starting a business from scratch mean? In your own words explain a different advantage and disadvantage.

Starting a business from scratch means that you start off from nothing, you can develop the business the way you are able to develop your own image and reputation.

Advantages includes having the ability to start the business at your own pace as well, you’re also free to develop your own image as well as reputation.

Disadvantages are the capability of a business failure and you have no idea if this business is going to succeed.

What does buying an existing business mean? In your own words explain a different advantage and disadvantage.

Buying a existing business means buying a business which someone else had previously owned ran.

Some advantages includes having the business in a good location as well you’re able to know how successful the business have being.

However having this could also be a disadvantage as the old customers don’t really know you and are not sure if they should continue with the business. Sometimes this business may also have a bad reputation which may cause limited customers as they don’t know what you’re like when running a business.

What does buying a franchise business mean? In your own words explain a different advantage and disadvantage.

Buying a franchise means that your buying business’s name as well as they method of doing things and also their reputation and images.

Advantage of a franchise business includes the image the business has already set to the market and is very successful. Not only did you pay for the bu siness you also pay for advertisement, which means you don’t have to worry about having to plan your own ads.

Disadvantage is not having the rights to change what you sell and the way you do business.

What do you think are the main advantages of buying a McDonalds franchise?

The advantages of buying a McDonalds business are the fame which McDonalds restaurants have already spread around the world everyone knows McDonalds th erefore you don’t have to worry about your business not succeeding due to the limited amount of people knowing what you are. By buying the McDonalds fr anchise you’re eligible to all the ads and promotion for the company.

What do you think are the main advantages of buying a Video Ezy franchise?

Buying a Video Ezy franchise allows you to have your own territory, which means that you’re the only one of the kind in this area, this will bring better business.

What are the benefits of owning a video rental business that you:

Start from scratch: You are free free to develop your own idea and management.

Bought as an existing business: It’s in a good location as well as knowing that the business is should be successful.

Bought as a franchise: Having your own territory set for you in that area. All the ads are done for you.

Check your knowledge so far – Jim’s Mowing

What are the two advantages and disadvantages of buying a Jim’s mowing franchise?

Advantages: A well-known business, which gives you, the advantage of knowing that this business has very good chance of doing well. Also Jim’s mowing offers new businesses training so they can receive a good start. Disadvantages: Not having the ability to sell the products that you want to sell and must depend on the what the business. Why would you want to start your business on the Internet?

Starting a business on the net can bring your many advantages includes the ability to advertise the business online, this helps to spread the information of your business everywhere. Not only that the cost of managing the business is also cheaper than that of other sorts of advertisements.

Analysis on accounting standardization of small and medium-sized enterprises

Robert Hughes, Alan Yue Se.

[Abstract] There are unclear boundaries between accounting subjects in accounting for small and medium-sized enterprises, and the boundaries between enterprise property rights and personal property are not.

Clear; The owner's own quality and tax evasion psychology restrict the standardization of accounting; The establishment of accounting institutions does not comply with relevant regulations;

In order to solve the problems of illegal operation in accounting, relevant measures must be taken to standardize accounting.

[Keywords:] small and medium-sized enterprises; Accounting standardization; accounting

Small and medium-sized enterprises play an important role in perfecting China's market mechanism, promoting the development of national economy, increasing employment and maintaining social stability. However, there are also many problems in the development, especially the nonstandard accounting, which is the bottleneck restricting the further development of small and medium-sized enterprises.

First, the accounting problems of small and medium-sized enterprises

1. The boundaries of accounting entities are unclear, and the boundaries between enterprise property rights and personal property are unclear. The separation of management right and ownership of small and medium-sized enterprises is far less obvious than that of large enterprises, especially for private enterprises in small and medium-sized enterprises, investors are operators, and the property of enterprises and personal family property often occupy each other, which brings difficulties to accounting work.

2. The low quality of the owners themselves and the psychology of evading paying taxes restrict the standardization of accounting for small and medium-sized enterprises. In the process of operation, small and medium-sized enterprises often have the idea of increasing their wealth by evading taxes for their own interests. When their business conditions are not good, their desire to evade taxes is even stronger. When the external supervision is not strong enough, this phenomenon will be widespread.

3. The establishment of accounting institutions does not comply with relevant regulations. Many small and medium-sized enterprises, especially private enterprises, do not set up accounting institutions according to regulations in order to save accounting costs. Even if some enterprises set up accounting institutions, the level is unclear and the division of labor is unclear, and the professional quality of accounting personnel is low. Because small and medium-sized enterprises generally operate in a variety of industries, the scale of operation is quite different, and the quality of financial personnel employed is uneven, which leads to the irregularity of accounting. In the appointment of accounting personnel, the most common practice of small enterprises is to use their relatives as cashiers and hire "experts" as part-time accountants. These personnel work in tax departments, financial managers of state-owned enterprises, and personnel of accounting firms, and generally come to make accounts regularly. Some small and medium-sized enterprise managers are also willing to hire accountants with strong ability to be full-time accountants, but because of their low development prospects and social awareness, coupled with poor job security, they are not attractive to outstanding accountants. There are also many problems in the qualification identification and standardized assessment of accounting practitioners, such as the serious phenomenon of accounting without a license, the endless phenomenon that accounting supervisors do not have professional and technical qualifications, and the follow-up education and training of accounting personnel has hardly been carried out.

5. Accounting is not standardized or not established according to law, and there are often illegal operations in accounting. Some small and medium-sized enterprises do not set up accounts at all, but use tickets to replace accounts; Or set up accounts, but the accounts are chaotic. There are also quite a few small and medium-sized enterprises that set up two or more sets of accounts, which seriously distort accounting information. In accounting, prepaid expenses and accrued expenses are not amortized according to regulations, profits are manipulated artificially, and books are kept by means of reverse accounting. Some accountants' knowledge structure is aging and their professional knowledge is low, which makes many theoretically perfect accounting methods and complex accounting techniques impossible to implement, or greatly reduced when they are implemented.

6. The function of internal accounting supervision has not been brought into play. Internal accounting supervision requires accountants to supervise the economic activities within the enterprise, but managers of small and medium-sized enterprises often interfere in accounting work, and accountants are subject to managers or driven by interests, often acting according to managers' intentions, making the accounting supervision function almost impossible to wield.

7. Original vouchers are costly or difficult to obtain. The cost of obtaining the original voucher is because there are different prices when enterprises buy goods. If they want to invoice, they have to increase the price and the price is higher. Don't ask for a lower invoice price. The difference between the two is tax. Other enterprises can't get invoices after they have incurred expenses, so they can only use illegal receipts to spend in the expenses apportioned by the higher authorities. Enterprises have no choice but not to do this account, or to adjust bills between them. 8. The internal control system of enterprises is not perfect enough, which also hinders the development of accounting standardization in small and medium-sized enterprises. Due to the low level of personnel quality and management in some small and medium-sized enterprises, it is impossible to establish and improve systems such as internal audit, quota management, measurement acceptance and cost accounting, which hinders the process of accounting standardization in small and medium-sized enterprises, resulting in asset loss, serious waste and chaotic management.

Two, standardize the accounting of small and medium-sized enterprises

1. Strengthen the construction and implementation of relevant laws and regulations to promote the all-round and healthy development of small and medium-sized enterprises. To solve small and medium-sized enterprises

The standardization of business accounting is difficult to achieve by the self-improvement of one or two enterprises and the efforts of accountants. Only by promoting the healthy development of small and medium-sized enterprises, solving the financing difficulties of enterprises, realizing scientific management and overcoming their own weaknesses can the problem of accounting standardization be fundamentally solved. The fundamental way to solve this problem is to implement the existing relevant laws and regulations, and formulate and revise the laws and regulations related to small and medium-sized enterprises in a timely manner according to the needs of economic development. Only in this way can we not only promote the accounting standardization of small and medium-sized enterprises, strengthen their management, but also escort their all-round development.

2. Establish an accounting system suitable for small and medium-sized enterprises in China. For a long time in the past, in the process of formulating the accounting standard system, the country rarely considered the differences between the accounting needs of small and medium-sized enterprises and those of large enterprises and listed companies. With the increasingly important role of small and medium-sized enterprises in China's economic development, accounting theorists have paid more and more attention to the accounting standardization of small and medium-sized enterprises. The formulation of accounting system for small and medium-sized enterprises should follow the following principles:

(1) adapt to the characteristics of small and medium-sized enterprises. In the design of accounting system, we should consider the setting of enterprise management organization system and keep consistent with it. Due to the small business volume of small and medium-sized enterprises, accounting can only be carried out in a centralized way, that is, by accounting institutions. Some small and medium-sized enterprises have limited transaction types and simple business activities, generally only need simple data, and there is no need for in-depth analysis of the data. Therefore, some enterprises should be allowed not to set up accounting institutions. Generally, it is advisable to have 2~3 accountants, and appoint one person as the financial supervisor. In the division of responsibilities, attention should be paid to the separation of incompatible responsibilities, such as cashier, general ledger and audit, cashier and general ledger, subsidiary ledger, etc. The accounting work of some enterprises can also be represented by social intermediary agencies. Small and medium-sized enterprises involve a wide range of industries, so universality should be considered in the setting of accounting subjects, and the influence on accounting system should be considered in view of the unlimited liability of small and medium-sized enterprises in the form of sole proprietorship and partnership; For the mutual occupation of enterprise property and individual family expenses, a current account should be set up for accounting; Appropriately relax the identification of credentials to solve the problem that it is difficult for small and medium-sized enterprises to obtain legal credentials. In short, the characteristics of SMEs must be fully considered in the formulation of accounting standards for SMEs. (2) The principle of importance requires that the information provided be focused. Compared with large enterprises, accounting information demanders have changed in small and medium-sized enterprises. First of all, the tax management needs of tax departments become the most important external needs; Secondly, the decision-making needs of investors and the management needs of managers are unified; Finally, there is the demand for bank loan management, but this demand is relatively weak because there are few loans provided by banks. The change of accounting information demand determines that the accounting of small and medium-sized enterprises should focus on the tax needs and internal information needs of these enterprises. (3) The principle of cost-effectiveness. The provision of accounting information is costly, and enterprises should stress the principle of cost-effectiveness in the process of providing accounting information. (4) Simple and easy. Due to the small business volume of small and medium-sized enterprises and the uneven quality of accounting personnel, the design of accounting system should be fully simple and easy to operate.

Strengthen external supervision. Judging from the current situation of small and medium-sized enterprises in China, it is unrealistic to standardize accounting work by relying on the constraints of enterprises themselves. We should rely more on external supervision to help small and medium-sized enterprises realize accounting standardization. The financial department should first guide and urge small and medium-sized enterprises to establish and improve the system of account books according to the requirements of the Basic Accounting Work Standard, and deal with them promptly and seriously if they find that they do not meet the requirements of the Basic Accounting Work Standard; Secondly, the financial department should also urge small and medium-sized enterprises to establish and improve the accounting internal control system and internal accounting system; Finally, the financial department should also do a good job in the follow-up education of financial personnel. The tax authorities should also improve the auditing methods, improve the attitude of tax officials towards small and medium-sized enterprises, and establish a tax agent system to increase the speed of tax declaration and reduce the workload of tax officials, so as to carry out the auditing work wholeheartedly.

We believe that as long as we fully realize the problems existing in the process of accounting standardization of small and medium-sized enterprises in China and fully consider the importance of small and medium-sized enterprises in economic development, relevant parties will make concerted efforts to do this arduous work better.

What do you think? It's 5000 words! ! ! ! very exhuasted