Author Archives: Karl

Confidentiality when it comes to client data

When thinking of your own personal dealings you have with companies, have you ever wondered why some information is asked from you? Or even more so, how they ensure the data doesn’t fall into third party hands? Obviously apart from the info you’ve consented to being shared.

Matter of fact is that some of it is really needed, i.e. e-mail address to send you the invoices, phone number to contact you in case of need and address to ship goods obviously, but why would they need your birthday or how many kids you have. And some could argue if the contact info is always needed in such detail.  Continue reading →

What is “fair value”?

Often times you can hear someone mention “fair value” of this and that. With this “this and that” being an asset of any kind that could be measured in fair value, we’ll focus on the term itself.

The term fair value is used for assets which are measured not at cost or at depreciated value, but precisely at fair value. Fair value by definition is an estimate, an unbiased and rational estimate of a potential market price for the said asset. It does take into consideration the characteristics of the asset in the sense that it’s the price willing parties would buy-sell the asset with. More so the sale should be a regular sale and not something done under abnormal circumstances, i.e. a liquidation sale.  Continue reading →

Bank deposits – accounting for them

Your most liquid asset, money, can be in various forms – physical cash, bank accounts and bank deposits. Even if the deposits have strict rules, i.e. you cannot take the money out until only after the term, it is still “money”. Although, yes, if the “term” is longer than 3 months, it’s accounted as a financial investment rather than “Cash and cash equivalents”.  Continue reading →

Keep in mind the payment dates for due invoices

You receive an invoice, it has a payment date that’s not today, and you put it away. I’m pretty confident that if the invoice had today’s date, it would get your attention for a bit longer, for as long as it takes to pay it. Note that there’s nothing wrong with it being put aside if the date wasn’t today’s.

However, as it happens, often times the invoice doesn’t get any attention apart from “Oh, don’t have to pay it today, I will look into it sometime later” or some similar comment. And that’s that.  Continue reading →

Audit yourself regularly

In essence auditing means checking the accounting data to ensure it’s accurate, meets all relevant standards and regulations. When you think about it, isn’t it something you also could do yourself?

Yes, there’s the compulsory audit, but regardless if you fall into the category of someone who has to have one or not, you can and should audit yourself. By no means should it be to the same extent as the auditor would come and look at your accounting, but in some areas it will probably go into more detail.  Continue reading →

Is the investment really worth it?

Buying something is easy, but is it really worth the money spent? Is the investment really a good investment? You should never make an investment that’s really not doing anything useful for your business.

First thing first, think about the purpose of the investment. What do you really needed it for? Is it for improving something, developing something or just in “I think we may find it useful” category?  Continue reading →