Starting a new business and acquiring business licenses and permits is no joke. A start-up with a unique idea may be exciting since it may be your first business adventure, but procuring licenses and permits is one of the least exciting parts of the journey. For legal operations, virtually every business needs licenses. However, knowing which is right for your business can be tricky. It all depends on the rules and regulations of the local government and policies set by the federal government to ensure safe and healthy business operations.
Since we must abide by specific rules and regulations for operating a business legally, we must involve state agencies and legal authorities to learn the legal obligations of a new business start-up. Small businesses usually face many difficulties setting up a business from scratch since they lack awareness regarding licenses and permits. More often than not, it is better to hire the expertise of legal experts to get the job done right—the very first time!
Lack Of Awareness Can Be Troublesome
Entirely too often, small businesses overlook the need to procure licenses and permits as they may be unaware of the requirements. Entrepreneurs can face heavy penalties and jail time if they fail to pay and register their businesses with the relevant departments. This may be extremely costly to companies because start-ups can’t afford to pay anything extra for a fine since they already have scarce resources to run their business operations. However, the good news is that now you can acquire the right license and permit without paying an arm and a leg, assuming you know which permits to register for.
Why Do Businesses Need Licenses and Permits?
Licenses and permits allow businesses to fall under the government’s legal protection. Registering with various government entities, such as the Chamber of Commerce and the Ministry of Trading, will help create more business growth and expansion opportunities. These government entities promote and support businesses by exposing them to international markets. The legal relationship with the government also allows subsidies (if announced by the government for the specific sector), which is huge for a start-up’s potential growth and success. It also eases the government, allowing them to track a business’s revenues for tax purposes.
Licenses and Permits—Done Right
Certain types of businesses cannot be initiated without acquiring licenses and permits from the specific departments that come under the direct control of the federal government. By certain types, we refer to businesses involving international trading, alcohol, aviation, and agriculture. This is why finding an experienced legal expert to execute certain important tasks like licensing and permits for specific industries is critical. Experts can trace and contact federal departments better than we ever could. It’s safe to hire them for the legal affairs of a business and will allow the start-up to get the footing it needs to begin.
Managing and Maintaining Licenses and Permits
According to studies, even registered businesses must pay fines and heavy penalties because they fail to manage and maintain their licenses and permits. Acquiring a license is easy, but maintaining it by keeping track of renewal dates is difficult. You should maintain and produce a copy of the licensing application to avoid penalties. Display the licenses and permits so that customers can see them. You may need additional business licenses if you plan to expand your business operations locally or internationally.
Initially, most businesses used to manage and maintain their licenses independently. However, this responsibility has often been transferred to legal experts who further have professional accountants in the loop for ideal bookkeeping and accounting records to know the exact status of taxes and finances.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Jennifer is the author of From Cubicle to Cloud and Founder/CEO of Complete Controller, a pioneering financial services firm that helps entrepreneurs break free of traditional constraints and scale their businesses to new heights.
Accounting isn’t just changing—it’s transforming at unprecedented speed. What was once a profession focused on number-crunching is now a technology-driven, strategy-centered field reshaping how businesses operate. The global accounting services market tells the story clearly: projected to reach $735.94 billion by the end of 2025, up from $544.06 billion in 2020. This explosive growth mirrors what we saw with internet adoption in the 1990s—revolutionary and unstoppable. If you’re still limiting your accounting function to bookkeeping and tax prep, you’re missing massive opportunities to drive your business forward.
Here are the five game-changing trends you need to know about—and how to use them to gain a competitive edge.
Leveraging AI in Accounting
Let’s face it—manual data entry belongs in the past. Today’s accounting demands more, and AI delivers. By 2027, AI investment in accounting is predicted to grow at a stunning 42.5% compound annual rate, with the market expanding from $6.68 billion in 2025 to $37.6 billion by 2030.
What does this mean for you? AI tools now automate routine tasks like bank reconciliations, invoice scanning, and risk pattern detection. Instead of spending hours on data entry, you can focus on analysis and strategy—where the real value lies.
Firms using AI tools have cut processing time by up to 40%. These systems don’t just work faster—they’re also more accurate, ensuring better compliance and enabling predictive analytics that help you spot trends before they become problems.
For small businesses, AI simplifiestax preparation for small businesses through automated categorization and document processing. The technology flags potential deductions and helps maintain audit-ready records with minimal effort.
Quick AI applications to consider:
Automate expense reporting with intelligent categorization
Implement machine learning models that detect unusual transactions
Use AI-backed systems to forecast tax liabilities
Cloud Accounting — The Future of Finance Management
If you’re still using desktop accounting software, you’re putting your business at a serious disadvantage. Cloud-based accounting systems like Xero, QuickBooks Online, and FreshBooks offer anytime, anywhereaccess to your financial data—a game-changer in today’s remote-first world.
The benefits are clear and immediate:
For accounting firms:
Manage multiple client portfolios from anywhere
Update records in real-time with seamless team collaboration
Maintain stronger compliance with automatic audit trails
For businesses:
Access easy-to-understand financial dashboards on demand
Share financial data securely with investors or advisors
Scale your financial systems without painful migrations
Modern online accounting software for startups offers features specifically designed for growing businesses, including customizable reporting, integrated payment processing, and automated bank feeds. These tools eliminate the data silos that plague traditional accounting setups.
CFOs and controllers increasingly list cloud accounting as their top operational priority—and with good reason. In a business environment where remote work is the norm, cloud-based systems ensure continuity and enable faster decision-making.
ESG Metrics — A New Frontier in Financial Reporting
Environmental, Social, and Governance (ESG) reporting has moved from a nice-to-have to a business essential—and not just for large corporations. Investors, customers, and regulators now expect businesses of all sizes to demonstrate their impact beyond financial returns.
This represents a massive shift in financial reporting through ESG metrics. Forward-thinking accountants are integrating sustainability metrics directly into financial statements and reports. The benefits go far beyond compliance:
Attract investors who prioritize sustainable businesses
Build stronger customer loyalty based on shared values
Reduce regulatory risks through proactive reporting
Smart businesses are getting ahead of this trend by implementing systems to track and report their ESG performance. Tools like Persefoni and Envizi help capture sustainability data, while frameworks from the International Sustainability Standards Board (ISSB) provide standardized reporting formats.
Practical ESG implementation steps:
Start with a baseline assessment of your environmental impact
Create simple ESG dashboards aligned with industry standards
Integrate sustainability metrics into your regular financial reviews
The Power of Data Analytics in Accounting
Imagine having the ability to predict cash flow issues before they happen, or to identify spending patterns that drain your resources. That’s the power of data analytics in finance management.
Modern accounting isn’t just about recording what happened—it’s about using that data to shape what happens next. When I began integrating analytics into client budgeting and forecasting, the impact was immediate: better decisions, faster responses to market changes, and more strategic resource allocation.
For small businesses, analytics tools help:
Spot spending inefficiencies that eat into profits
Predict revenue fluctuations based on historical patterns
Create visual dashboards that make financial data accessible to non-financial team members
You don’t need a data science degree to get started. Today’s accounting platforms include built-in analytics tools that transform raw numbers into actionable insights. The key is knowing which questions to ask of your data.
Expanding Client Advisory Services in Accounting
The accountant’s role has evolved far beyond tax preparation and compliance. Today, 80% of accounting firms report increasing client demand for financial planning, business strategy, and technology consulting services.
This trend is amplified by a looming talent shortage—75% of CPAs are set to retire within the next decade, with the accounting unemployment rate already at just 2.0%. Firms that expand into advisory services aren’t just meeting client needs; they’re positioning themselves for long-term sustainability.
For business owners, this means you should expect more from your accounting relationship. The right accountant should help you:
Develop strategic growth plans based on financial insights
Navigate technology decisions that impact your financial systems
Create proactive tax strategies, not just annual compliance
Knowing how to choose an accountant for your business has never been more important. Look for professionals who offer quarterly strategic reviews, technology guidance, and ROI-focused planning—not just basic bookkeeping.
Building Trust in Digital Accounting: Challenges and Opportunities
The shift to digital accounting brings significant benefits but also raises important questions about trust and security. Your financial data is among your most sensitive business assets, so concerns about digital security are valid.
Building trust in digital accounting systems requires:
Implementing strong security protocols like multi-factor authentication
Maintaining clear data privacy policies that clients can easily understand
Creating transparent processes for handling sensitive information
The most successful accounting professionals recognize that technology should enhance human relationships, not replace them. Regular video calls, clear communication about system changes, and personal attention to client concerns help maintain trust during digital transformations.
Case Study: How AI and Cloud Accounting Transformed a Small Business
Consider a mid-sized design agency that struggled with inefficient accounting processes. They spent hours on manual data entry, used outdated desktop software, and lacked real-time visibility into their financial position.
By implementing AI tools for receipt capture (using Dext) and cloud accounting software with custom dashboards (via Xero), they transformed their finance function. Monthly advisory sessions focused on forecasting and KPI analysis completed the picture.
The results were dramatic:
Administrative tasks reduced by 60%
Annual costs cut by $15,000
Decision-making speed doubled
Team morale significantly improved
This transformation didn’t happen overnight, but through a strategic, step-by-step approach that prioritized bothtechnology adoption and human factors. The key lesson: meaningful change comes from combining the right tools with the right expertise.
Conclusion
Accounting is no longer just about keeping score—it’s about driving business strategy. The five trends we’ve explored—AI automation, cloud accounting, ESG reporting, data analytics, and advisory services—represent bothchallenges and opportunities for businesses of all sizes.
The accounting firms that thrive in this new landscape will be those thatembrace technology while deepening their advisory capabilities. And the businesses that partner with these forward-thinking firms will gain significant competitive advantages.
I’ve witnessed firsthand how these transformationscreate better outcomes for business owners. You don’t have to tackle all five trends at once—start with the areas that address your most pressing challenges, and build from there.
Ready to transform your financial management approach? Visit CompleteController.com to learn how our bookkeeping, controller, and financial management services can help you leverage these trends for business success.
FAQ
How quickly can I expect to see ROI from implementing AI in my accounting processes?
Most businesses see measurable returns within 3-6 months of implementing AI accounting tools. Initial benefits typically include time savings on routine tasks (20-40% reduction), while strategic benefits like improved forecasting accuracy develop over 6-12 months as the system learns your patterns.
What are the security risks of moving to cloud accounting?
Cloud accounting actually offers better security than desktop software for most businesses. The main risks include unauthorized access (mitigated by strong password policies and multi-factor authentication) and data transfer vulnerabilities (addressed by encrypted connections). Choose cloud providers that offer SOC compliance and regular security audits.
Is ESG reporting only relevant for large corporations?
No, businesses of all sizes increasingly benefit from ESG reporting. While requirements are more formalized for public companies, small businesses gain advantages through improved customer loyalty, better financing terms from ESG-focused lenders, and operational efficiencies from sustainability initiatives. Start with simple metrics relevant to your industry.
What’s the first step in implementing data analytics in my accounting process?
Begin by identifying 2-3 key business questions you want to answer with your financial data. Examples include “Which product lines have the highest profit margins?” or “What factors most affect our monthly cash flow?” Then work with your accounting team to ensure you’re capturing the right data points and using appropriate visualization tools.
How do I evaluate if my current accountant provides adequate advisory services?
Your accountant should proactively offer insights beyond compliance work. They should provide regular business reviews (at least quarterly), suggest tax planning strategies before year-end, and demonstrate understanding of your industry metrics. Follow tax preparation best practices and ensure they discuss both immediate tax implications and long-term financial strategy.
LinkMyBooks. (April 21, 2025). “Accounting Industry Statistics 2025 (Trends & New Data).” https://linkmybooks.com/blog/accounting-industry-statistics
Smith, A. (2020). “Digital Revolutions: From Internet to Social Media.” Digital Journal.
Complete Controller. “Startup Accounting: Top 7 Sites.” https://www.completecontroller.com/startup-accounting-top-7-sites/
Complete Controller. “When Working with an Accountant: Ask These 6 Questions.” https://www.completecontroller.com/when-working-with-an-accountant-ask-these-6-questions/
IRS.gov. “Tax Information for Small Businesses & Self-Employed.” https://www.irs.gov/businesses/small-businesses-self-employed/tax-information-for-small-businesses-self-employed
Investopedia. “ESG (Environmental, Social, and Governance).” https://www.investopedia.com/terms/e/esg.asp
International Financial Reporting Standards. “International Sustainability Standards Board.” https://www.ifrs.org/groups/international-sustainability-standards-board/
Vic.ai. https://www.vic.ai/
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Jennifer is the author of From Cubicle to Cloud and Founder/CEO of Complete Controller, a pioneering financial services firm that helps entrepreneurs break free of traditional constraints and scale their businesses to new heights.
Cloud Computing Best Practices for Optimal Performance
Cloud computing best practices focus on strategic architecture design, proactive security measures, and continuous resource optimization to maximize performance and value. When implemented properly, these practices create resilient, cost-effective systems that scale with your business needs while maintaining security.
I’ve spent over 20 years building Complete Controller into a cloud-first financial services provider, and I’ve seen firsthand how proper cloud strategy transforms business operations. Worldwide public cloud spending is projected to grow 20.4% to $675.4 billion in 2024, driven largely by AI adoption and application modernization. In this article, I’ll share practical cloud computing strategies that reduce costs, enhance security, and improve performance based on what actually works for businesses across industries.
What are cloud computing best practices for optimal performance?
Cloud computing best practices involve cloud-native architecture, zero-trust security, resource optimization, multi-cloud strategies, and governance frameworks
Cloud-native design breaks applications into microservices for better scalability and resilience
Zero-trust security verifies every access request, regardless of source location
Cost optimization combines spot instances, reserved capacity, and automated monitoring
Multi-cloud approaches prevent vendor lock-in while maintaining consistent performance
Creating Cloud-Native Architecture for Maximum Scalability
Cloud-native architecture represents a fundamental shift in how applications are designed, built, and deployed. Rather than simply lifting and shifting traditional monolithic applications to the cloud, cloud-native approaches rebuild systems from the ground up to leverage cloud capabilities.
By 2025, over 95% of new workloads will use cloud-native technologies like microservices, containers, and declarative APIs. This massive shift happens because cloud-native design delivers tangible business benefits: faster deployment cycles, improved resilience, and superior scalability compared to traditional architectures.
Implementing microservices architecture
Microservices break monolithic applications into smaller, independently deployable components that communicate through well-defined APIs. This approach delivers several key advantages:
Independent scaling: Resources allocate only where needed instead of scaling the entire application
Improved resilience: Failures in one service don’t necessarily bring down the entire system
Technology flexibility: Different services can use different programming languages and frameworks
Parallel development: Teams can work simultaneously on different services
Netflix exemplifies successful microservices implementation, using AWS for 100,000+ server instances to stream content globally. Their architecture allows individual components to scale independently during traffic spikes while maintaining consistent performance.
Leveraging AI-Driven Cloud Optimization
Artificial intelligence and machine learning have revolutionized how we manage cloud resources by automating optimization tasks that previously required constant human attention.
Modern AI tools analyze historical usage patterns, predict future resource needs, and automatically adjust configurations to maintain performance while minimizing costs. These systems detect anomalies faster than human operators and often resolve issues before users notice any impact.
Predictive scaling and resource allocation
AI-powered predictive scaling represents a significant improvement over traditional reactive auto-scaling:
Anticipatory scaling: Systems scale up resources before traffic spikes occur
Workload pattern analysis: AI identifies recurring patterns and seasonal trends
Automated resource balancing: Workloads shift to regions with better pricing or performance
Anomaly detection: Unusual patterns trigger alerts before becoming problems
A fintech company implemented AI-driven load balancing that reduced compute costs by 40% by dynamically shifting traffic to lower-cost regions during off-peak hours while maintaining response times below 100ms.
Implementing Zero-Trust Security Frameworks
The distributed nature of cloud computing requires a fundamentally different security approach than traditional perimeter defenses. Zero-trust security operates on the principle of “never trust, always verify” regardless of whether access requests originate inside or outside network boundaries.
By 2025, 60% of companies will adopt zero-trust security models to counter rising cloud threats. This shift happens because traditional perimeter security simply doesn’t work in environments where resources are distributed across multiple clouds and accessed from countless locations.
Core zero-trust security components
A comprehensive zero-trust strategy incorporates multiple layers of protection:
Identity verification: Strong authentication for all users and services
Least privilege access: Users receive only the minimum permissions needed
Micro-segmentation: Network segmentation limits lateral movement
Continuous monitoring: All activities undergo constant scrutiny
Automated responses: Systems automatically react to suspicious behaviors
For encrypted data, implement these best practices:
Use AES-256 encryption for data at rest in storage
Deploy TLS 1.3 for all data in transit between services
Rotate encryption keys quarterly using automated systems
Store encryption keys in hardware security modules (HSMs)
Implement encrypted backup systems with separate key management
Optimizing Cloud Costs Through Strategic Resource Management
Cloud costs can quickly spiral without proper management practices. The flexibility that makes cloud computing powerful also creates opportunities for waste when resources remain underutilized or overprovisioned.
Effective cloud cost management strategies combine procurement techniques, usage optimization, and continuous monitoring to reduce expenses without sacrificing performance.
Cost-saving procurement strategies
Strategy
Description
Potential Savings
Spot Instances
Use spare capacity for non-critical workloads
Up to 90% vs. on-demand
Reserved Instances
Pre-commit to 1-3 year contracts
Up to 72% vs. on-demand
Savings Plans
Commit to consistent usage levels
Up to 66% vs. on-demand
Tiered Storage
Move infrequently accessed data to lower-cost tiers
Up to 80% for cold storage
Capital One’s cloud migration to AWS demonstrates the long-term value of strategic cost management. Their eight-year migration of 2,000 applications not only reduced transaction errors by 50% but also delivered substantial cost savings through rightsizing and reserved capacity purchases.
Forecast monthly spending based on current patterns
Recommend optimization opportunities based on usage analysis
Developing Multi-Cloud and Hybrid Cloud Strategies
Multi-cloud and hybrid cloud approaches have become standard practice for enterprises seeking flexibility, reliability, and negotiating leverage. According to Flexera research, 89% of enterprises now use multi-cloud strategies to optimize costs and prevent dependency on a single provider.
The right multi-cloud strategy balances the benefits of provider diversity against the additional complexity of managing multiple environments.
When to choose multi-cloud vs. hybrid cloud
Different business scenarios call for different deployment models:
Multi-Cloud Best For:
Avoiding vendor lock-in
Optimizing costs across providers
Accessing unique services from different vendors
Geographic distribution requirements
Hybrid Cloud Best For:
Meeting specific compliance requirements
Gradually migrating from legacy systems
Specialized workloads with unique hardware needs
Maintaining control over sensitive data
Whether implementing multi-cloud or hybrid approaches, standardization becomes critical. Choose management tools that work consistently across environments and establish unified monitoring systems that provide visibility across all cloud providers.
Establishing Robust Governance and Compliance Frameworks
Cloud governance provides the structure, policies, and processes that ensure cloud resources align with business objectives while meeting regulatory requirements. Implementing cloud governance frameworks should balance control with the agility that makes cloud computing valuable.
A comprehensive governance framework addresses several key areas:
Financial governance: Budgeting, cost allocation, and spending limits
Security governance: Access controls, data protection, and threat management
Operational governance: Performance monitoring, SLA management, and disaster recovery
Compliance governance: Regulatory requirements, audit procedures, and documentation
Building resilient cloud infrastructure
Resilience requires both technical measures and organizational processes:
Disaster recovery planning: Document recovery procedures and test them regularly
Multi-region deployment: Distribute workloads across geographic regions
Chaos engineering: Deliberately introduce failures to test system resilience
Incident response protocols: Establish clear procedures for handling outages
When we transitioned our bookkeeping platform at Complete Controller to a multi-cloud strategy, implementing strict governance prevented configuration drift between environments. Our governance framework includes automated compliance checks that run daily, ensuring our systems maintain the 99.9% uptime our clients depend on for their financial operations.
Final Thoughts: Implementing Cloud Best Practices Strategically
Cloud computing best practices aren’t just technical considerations—they’re business strategies that directly impact operational efficiency, security posture, and financial performance. The most successful implementations align cloud practices with specific business objectives and adapt as those objectives evolve.
Start with clear business goals, then select and implement the practices that deliver the most value for your specific situation. Whether you’re focused on scalability, security, cost optimization, or a combination of priorities, a methodical approach yields better results than attempting to implement everything simultaneously.
Remember that cloud optimization is an ongoing process, not a one-time project. As your business grows and cloud providers introduce new capabilities, continuously reassess your approach to cloud computing strategies and adjust accordingly.
Need expert guidance on implementing these cloud best practices for your financial systems? Visit completecontroller.com to learn how our team can help you build secure, scalable financial infrastructure in the cloud.
FAQ
What is the most important cloud computing best practice for small businesses?
Cost optimization through right-sizing resources is typically most important for small businesses. Start by implementing reserved instances for predictable workloads and automated monitoring to identify waste. This approach can reduce cloud spending by 20-30% without compromising performance, freeing up capital for other business needs.
How do I implement zero-trust security in my cloud environment?
Begin with identity and access management by requiring MFA for all users and implementing role-based access controls. Next, segment your network to limit lateral movement, encrypt all data both at rest and in transit, and deploy continuous monitoring tools that flag unusual activities. Implement these changes incrementally rather than attempting a complete overhaul at once.
What’s the difference between multi-cloud and hybrid cloud strategies?
Multi-cloud uses services from multiple public cloud providers (like AWS, Azure, and Google Cloud) simultaneously, while hybrid cloud combines public cloud services with private cloud or on-premises infrastructure. Multi-cloud strategies provide flexibility and prevent vendor lock-in, while hybrid approaches often better serve organizations with strict compliance requirements or legacy systems.
How can AI improve cloud performance?
AI enhances cloud performance through predictive scaling that provisions resources before demand spikes occur, intelligent load balancing that distributes workloads optimally, automated performance tuning that adjusts configurations based on workload patterns, and anomaly detection that identifies potential issues before they impact users.
What metrics should I track to measure cloud performance?
Track infrastructure metrics like CPU utilization, memory usage, and network throughput; application metrics such as response time, error rates, and throughput; cost metrics including spend by service and utilization rates; and business metrics that connect cloud performance to actual business outcomes like conversion rates or transaction processing speeds.
Sources
All Covered. (2025). “Top 5 Cloud Computing Trends to Watch.”
AWS. (2025). “Netflix Case Study.” aws.amazon.com/solutions/case-studies/netflix-case-study/
Cloud Security Alliance. (2025). “Top Threats to Cloud Computing 2025.”
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
The following are the top facts and figures related to the cyber security industry over the previous year and demonstrate what’s to come in the following years.
Top 5 Cyber Security Facts and Figures
Cyber Crime Costs
The expense is expected to hit $6 trillion a year by 2021. Everything starts and closes with digital wrongdoings. Without it, there’s nothing to protect in the digital world. Cyber security experts and significant media channels have widely agreed on the expectation that digital wrongdoing harms will cost people around the world an estimated $6 trillion annually by 2021, up from $3 trillion in 2015.
This speaks to the best exchange of monetary riches ever, dangers the motivators for development and speculation, and will be more productive than the worldwide exchange of all significant unlawful medications joined.
Rising Cyber Security Spending
Cyber security spending is to surpass $1 trillion from 2017 to 2021. According to Gartner, the ever-rising tide of digital wrongdoing has pushed data security (a subsidiary of cyber security) spending to more than $86.4 billion in 2017. That does exclude the Internet of Things (IoT), modern IoT, mechanical control frameworks (ICS) security, car security, and other cyber security classifications. Worldwide spending on cyber security items and administrations is anticipated to surpass $1 trillion in more than five years, from 2017 to 2021.
Cyber Security Workforce Shortage
Digital wrongdoing will dramatically multiply the number of unfilled cybersecurity employees, which is anticipated to reach 3.5 million by 2021. Each IT position is additionally a cyber security position now. Each IT employee and innovation specialist should be included in securing and guarding applications, information, gadgets, frameworks, and individuals. The cyber security workforce deficiency is surprisingly more terrible than the employment numbers recommend. Therefore, cyber security unemployment rates have dropped to almost zero percent.
The Growing Target for Cybercriminals
Human assault surface is expected to reach around 6 billion individuals by 2022. As the world advances, people have pushed machines forward as the best focus for digital crooks. There were 3.8 billion web clients in 2017 (51% of the total 7 billion population), up from 2 billion in 2015.
Cyber security experts predict that there will be 6 billion web clients by 2022 (75% of the anticipated population of 8 billion) — and over 7.5 billion web clients by 2030 (90% of the expected population of 8.5 million, six years old and more established). The programmers notice blood now, not silicon.
Rising Ransomware Threat
Worldwide ransomware harm costs are anticipated to surpass $5 billion. That is around $325 million more than 2015 — a 15X increment in two years and anticipated that would compound. Ransomware assaults on social insurance associations — the No. 1 digitally assaulted industry — will be fourfold by 2020. Cyber security experts expect ransomware harm expenses will ascend to $11.5 billion in 2019 and that a business will succumb to a ransomware assault at regular intervals at that point.
What does everything mean? In 2015, Ginni Rometty, IBM’s executive, President, and CEO, stated, “Digital wrongdoing is the best danger to each organization on the planet.“
Top 5 Cyber Security Insights
By 2021, annual cybercrime damage costs could soar to nearly $6 trillion.
From 2017 to 2021, cyber security spending is projected to surpass $1 trillion.
Cybersecurity is anticipated to create 1.5 million jobs by 2019.
The human attack surface is expected to encompass 4 billion individuals by 2020.
Approximately 200 billion IoT devices will demand online protection by 2020.
Conclusion
In summary, the cyber security landscape presents a daunting yet evolving reality. As digital crime costs escalate to unprecedented levels and global spending on cyber security skyrockets, the shortage of skilled professionals in the field becomes increasingly acute. With the rapidly expanding human attack surface and ransomware threats rising, the urgency to fortify defenses and adapt to the evolving threat landscape has never been greater.
These top 5 cyber security insights underscore the critical need for proactive measures and strategic investments to safeguard individuals, organizations, and the ever-expanding digitalecosystem against cyber threats in the years to come.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
The millennial era has caused rapid changes in the manufacturing processes of almost all industries operating worldwide. To keep up with these changes and improve the custom assembly process, entrepreneurs must spend vast amounts of money to stay updated with the ever-changing market and ensure that their product or service is the latest and greatest.
These are five effective ways to optimize your manufacturing while saving costs.
Taking the Production Process Up a Notch
Entrepreneurs should look at their entire business and not limit their focus to the custom assembly line, manufacturing costs, or their products. This will enable entrepreneurs to focus on process optimization, essential in improving overall efficiency.
Consider even the slightest factors involved in your production process. Point out all the big or small characteristics that affect your business in the bigger picture. Optimizing only one aspect of the business will cause other processes to deteriorate or slow down, increasing your costs rather than cutting down on costs.
Entrepreneurs should ask themselves what effect changing a single machine in the assembly line or replacing a production task would have on the entire business.
Enhancing Your Workforce
Decisions related to the production of a business are mostly based upon the capacity-utilization approach. Instead, achieve lower labor costs and requirements by switching to a demand-calibrated approach. Workforce optimization will help you cut down on overtime expenses. A hyper-productive team of employees can be established through a labor-management system that includes:
Visibility of the current and future earnings of a company
Performance Accountability: The division of work among employees by the manager
Self-initiated incentive pay: Employees driving the work productivity
Managing and monitoring energy consumption
Optimizing your production process and creating a more efficient workforce will enable you to work slowly, cutting down one of the biggest expenses in the custom assembly process: energy consumption.
Make decisions related to production based on the demands of the customer. This will increase customer satisfaction and improve production by reducing excessive energy costs, such as the electricity used to manufacture your products. Focus on these areas to cut down the costs of energy used in the production process:
Installing lighting in your business premises that is energy efficient.
Optimizing the air compressors and repairing leakages.
Overhauling or repairing the HVAC systems that have grown old makes them use more electricity.
Establishing a team that only works on managing energy costs.
Rescheduling the usage of electric machinery that uses high amounts of electricity.
Continuous assessment of energy
Lowering Costs of Regulatory Compliance
Once the production processes are managed, the costs in manufacturing regulatory compliance should decrease. Alongside this, the number of mistakes that might be made in the production process will decline, reducing the costs of correcting the errors. Investing in technology will benefit from keeping your compliance up to date with the help of your automation technologies.
Effective employee training will enable your team to stay updated with any technologies you introduce in the manufacturing process, reducing the cost of any damage the new machinery may cause.
Consider the Carrying Costs of Your Inventory
Storing inventories for more extended periods can prove to be highly cost-effective. Consider the following points, if applicable, as a manufacturer.
Cost of storage
Maintenance of the inventory
Disposal of useless or worn-out products in the inventory
Be careful that overproduction does not take place, as it will lead to an increase in the costs of your production process. Furthermore, reduce storage costs by disposing of useless products from your inventory. An effective way is to plan the production process so that your operations respond directly to the customer’s demands. Within a short period, if you apply the above steps, your bookkeeping records will prove that these cost-cutting methods were effective in a huge way.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Essential Financial Ratios Lenders Assess for Credit Worthiness
Financial ratios lenders review encompass four critical categories that determine your creditworthiness: liquidity ratios like current and quick ratios that measure short-term payment ability, leverage ratios including debt-to-equity and debt service coverage that assess financial risk, profitability ratios that demonstrate earning power, and coverage ratios that show your capacity to meet ongoing financial obligations.
After two decades as CEO of Complete Controller, I’ve witnessed countless qualified borrowers get denied simply because they didn’t understand what lenders were truly evaluating. The DSCR lending market has experienced explosive growth from a niche product to a mainstream financing tool, with originators like RCN Capital and A&D Mortgage producing billions in DSCR volume annually by 2023, compared to minimal market presence just a decade earlier. This article reveals the exact metrics that separate approval from rejection, giving you the roadmap to optimize your financial profile before applying for credit.
What are the financial ratios lenders review, and why do they matter?
Financial ratios lenders review are quantitative measures derived from financial statements that assess liquidity, leverage, profitability, and debt coverage capacity
Liquidity ratios evaluate your ability to meet short-term obligations using current assets like cash and receivables
Leverage ratios measure your debt burden relative to assets or equity, indicating financial risk and stability
Coverage ratios assess your capacity to service debt payments through operating cash flow and earnings
Profitability ratios demonstrate your ability to generate consistent income and sustain long-term growth
The Foundation of Creditworthiness Assessment
Lenders operate within razor-thin margins and face strict regulatory requirements, making comprehensive risk assessment absolutely essential for their survival. Financial institutions cannot rely solely on credit scores or collateral—they must dive deep into the quantitative story your financial statements tell through ratio analysis.
This systematic approach transforms raw financial data into actionable insights about your business’s operational efficiency, financial stability, and repayment capacity. The credit analysis process combines both qualitative factors, like management experience and market conditions, with quantitative metrics that provide objective measurements of financial health.
The four pillars of financial ratio analysis
Credit analysts organize financial ratios into four distinct categories, each serving a specific purpose in the overall creditworthiness evaluation:
Liquidity ratios focus on short-term financial health and your ability to convert assets into cash when needed
Leverage ratios examine how much debt you’re carrying relative to your assets or equity, providing insight into long-term financial sustainability
Coverage ratios measure your capacity to service existing debt obligations through operational cash flow
Profitability ratios assess your ability to generate consistent returns and sustain business operations over time
Liquidity Ratios That Determine Short-Term Viability
Liquidity ratios serve as the first line of defense in credit analysis, measuring your business’s ability to meet immediate financial obligations without selling long-term assets. These ratios are particularly crucial for lenders because they indicate whether you can maintain operations during temporary cash flow disruptions or unexpected expenses.
The importance of liquidity extends beyond simple bill-paying capacity—it reflects your ability to take advantage of growth opportunities, weather economic downturns, and maintain supplier relationships. A strong liquidity position demonstrates financial discipline and reduces the risk of default during challenging periods.
Current ratio analysis and benchmarks
The current ratio represents the most fundamental liquidity measure, calculated by dividing current assets by current liabilities. This ratio reveals whether your business has sufficient short-term resources to cover obligations due within the next twelve months.
Lenders typically prefer seeing current ratios between 1.5 and 2.0, though acceptable ranges vary significantly by industry. A current ratio below 1.0 signals potential liquidity problems, as it indicates that current liabilities exceed current assets. However, ratios significantly above 3.0 may suggest inefficient capital allocation, as excess cash could be invested in growth opportunities rather than sitting idle.
Quick ratio for conservative assessment
The quick ratio provides a more stringent liquidity test by excluding inventory and prepaid expenses from current assets. This “acid test” ratio focuses exclusively on the most liquid assets—cash, marketable securities, and accounts receivable—that can be converted to cash within 90 days.
Quick ratios of 1.0 or higher indicate strong liquidity positioning, suggesting your business can meet short-term obligations without relying on inventory sales. Companies in service industries often show higher quick ratios since they carry minimal inventory, while manufacturing and retail businesses typically show lower ratios due to significant inventory investments.
Leverage Ratios That Reveal Financial Risk
Leverage ratios form the cornerstone of credit risk assessment, providing lenders with critical insights into how your business finances its operations and the sustainability of your capital structure. These metrics reveal the balance between debt and equity financing, helping lenders understand your financial flexibility and ability to weather economic challenges.
High leverage ratios indicate greater financial risk, as excessive debt obligations can strain cash flow and limit operational flexibility during difficult periods. The relationship between leverage and creditworthiness extends beyond simple debt levels to encompass debt servicing capacity and financial stability over time.
Debt-to-equity ratio standards
The debt-to-equity ratio measures the proportion of debt financing relative to equity investment in your business. This fundamental leverage metric helps lenders assess your financial risk profile and commitment to the business through equity investment.
Industry standards for acceptable debt-to-equity ratios vary considerably, but most lenders prefer ratios below 2.0 for traditional businesses. Technology and service companies often operate successfully with higher ratios due to lower asset requirements, while capital-intensive industries typically require more conservative leverage levels.
Debt service coverage ratio requirements
The debt service coverage ratio (DSCR) represents perhaps the most critical metric in commercial lending, measuring your ability to service debt payments through operating cash flow. In 2025, most lenders require a minimum DSCR of 1.25, meaning rental income must be at least 125% of debt obligations, though some aggressive lenders accept ratios as low as 0.95 for high-yield properties.
Real estate investor Sarah successfully qualified for a $200,000 DSCR loan in Tampa, Florida, by demonstrating strong cash flow metrics. Her property generated $2,000 monthly rent ($24,000 annually), with operating expenses of $9,600 (40% of gross income), resulting in a Net Operating Income of $14,400. With an annual debt service of $12,000, her DSCR is calculated to be 1.2 ($14,400 ÷ $12,000), meeting lender requirements and qualifying for financing without traditional income documentation.
Coverage Ratios That Measure Payment Capacity
Coverage ratios provide lenders with specific insights into your ability to meet ongoing financial obligations through operational performance. These metrics focus on the relationship between earnings and fixed charges, helping lenders assess whether your business generates sufficient cash flow to support additional debt service.
According to S&P Global Ratings, DSCR loans showed remarkably low delinquency rates of only 2% for loans 60 days past due as of early 2023, even as interest rates increased, demonstrating that borrowers focused on cash flow metrics tend to be financially disciplined.
Interest coverage analysis
The interest coverage ratio measures your ability to meet interest payment obligations through operating earnings. Calculated by dividing EBIT (earnings before interest and taxes) by interest expense, this ratio indicates how many times your earnings can cover required interest payments.
Lenders typically seek interest coverage ratios exceeding 1.5, though preferred levels vary based on industry characteristics and business stability. Strong interest coverage ratios provide confidence that your business can maintain interest payments even during periods of reduced profitability.
Fixed charge coverage considerations
Fixed charge coverage ratios expand beyond interest payments to include other fixed obligations like lease payments, principal amortization, and essential capital expenditures. This comprehensive approach provides lenders with a more complete picture of your fixed cost obligations and available cash flow after meeting all essential requirements.
This broader coverage measure becomes particularly relevant for businesses with significant lease obligations or equipment financing arrangements. Strong fixed charge coverage ratios indicate robust operational performance and sufficient cash generation to support additional borrowing.
Profitability Ratios That Demonstrate Earning Power
Profitability ratios provide essential insights into your business’s ability to generate consistent returns and sustain long-term operations. These metrics help lenders assess whether your business model produces sufficient earnings to support debt service while maintaining operational viability.
The relationship between profitability and creditworthiness extends beyond simple earnings levels to encompass consistency, sustainability, and growth potential. Profitable businesses are more likely to survive economic challenges and continue making debt payments even during difficult periods.
Profit margin benchmarks
Profit margins measure your business’s efficiency in converting revenue into profit, providing lenders with insights into operational effectiveness and pricing power. Net profit margins reveal the percentage of revenue that remains after all expenses, while gross profit margins focus on core operational efficiency before overhead costs.
Lenders evaluate profit margin trends over time to assess business trajectory and sustainability. The ability to maintain or improve profit margins during economic uncertainty particularly impresses lenders, as it demonstrates operational resilience and effective management.
Return on assets performance
Return on assets (ROA) measures how effectively your business utilizes its asset base to generate profits. This ratio provides lenders with insights into management efficiency and asset utilization, helping assess whether your business generates appropriate returns relative to its investment base.
ROA analysis becomes particularly important when evaluating asset-based lending opportunities or assessing collateral values. Consistent ROA performance over multiple periods provides additional confidence in management capabilities and business sustainability.
Strategic Approaches to Ratio Improvement
Improving your financial ratios requires a comprehensive strategy that addresses both short-term liquidity concerns and long-term financial health. The average credit score for DSCR loan borrowers is 732, though lenders can work with scores as low as 620. Borrowers above 720 typically qualify for interest rates as low as 7%, compared to 8-10% for those at minimum DSCR levels.
Liquidity enhancement strategies include accelerating receivables collection, optimizing inventory levels, and negotiating extended payment terms with suppliers. These operational improvements directly impact current and quick ratios while improving overall cash flow management.
Operational efficiency improvements
Operational efficiency directly impacts multiple financial ratios simultaneously, making it a powerful tool for comprehensive creditworthiness improvement. Revenue enhancement through pricing optimization, cost reduction through process improvements, and working capital management through inventory and receivables optimization all contribute to stronger financial metrics.
Focus areas include:
Automation opportunities that reduce costs
Pricing strategies that improve margins
Process improvements that accelerate cash conversion cycles
Systematic implementation of best practices across operations
Conclusion
Understanding the financial ratios lenders review provides a clear roadmap for improving your creditworthiness and securing favorable lending terms. The four categories—liquidity, leverage, coverage, and profitability ratios—work together to paint a comprehensive picture of your business’s financial health and repayment capacity.
As I’ve learned through decades of helping businesses navigate the lending landscape, success comes from understanding not just what ratios to track, but how to improve them systematically over time. When you’re ready to optimize your financial ratios and position your business for lending success, visit Complete Controller to discover how our expert team can help transform your financial profile and accelerate your growth objectives.
Frequently Asked Questions About Financial Ratios: Lenders Review
What are the most important financial ratios lenders look at?
Lenders prioritize debt service coverage ratio (DSCR), current ratio, debt-to-equity ratio, and interest coverage ratio as the most critical metrics for credit decisions.
What is a good debt service coverage ratio for loan approval?
Most lenders require a minimum DSCR of 1.25, meaning your cash flow should exceed debt payments by at least 25 percent to provide adequate payment security.
How can I improve my current ratio quickly?
Accelerate accounts receivable collection, reduce short-term debt payments, delay non-essential capital purchases, and optimize inventory levels to improve current ratio rapidly.
What debt-to-equity ratio do lenders prefer?
Most lenders prefer debt-to-equity ratios below 2.0 for traditional businesses, though technology and service companies may operate successfully with higher ratios.
How does profit margin affect loan approval?
Consistent profit margins demonstrate business stability and management competence, with improving margins suggesting effective cost management that impresses lenders.
Sources
Baseline Software. (2025, June 3). “A Brief History of DSCR Loans.” https://www.baselinesoftware.com/resources/a-brief-history-of-dscr-loans
Complete Controller. “5 Reasons Why Borrowing Money is Better Than Giving Up the Equity.” https://www.completecontroller.com/5-reasons-why-borrowing-money-is-better-than-giving-up-the-equity/
Complete Controller. “Net Profit Margin Business Essential.” https://www.completecontroller.com/net-profit-margin-business-essential/
Griffin Funding. (2025, June 27). “DSCR Loans: What it is, Expert Advice & How to Apply (2025).” https://griffinfunding.com/non-qm-mortgages/debt-service-coverage-ratio-investor-loans/
LendingGig. (2024, December 18). “Why DSCR Lending is a Game-Changer for Real Estate Investor.” https://lendinggig.com/blog/why-dscr-lending-is-a-game-changer-for-real-estate-investor
Longleaf Lending. (2025, March 26). “DSCR Loan Approval Rates: What Lenders Are Looking For in 2025.” https://longleaflending.com/DSCR-loan-approval-rates-2025
Wikipedia. “Debt Service Coverage Ratio.” https://en.wikipedia.org/wiki/Debtservicecoverage_ratio
Wikipedia. “Return on Assets.” https://en.wikipedia.org/wiki/Return
onassets
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Jennifer BrazerFounder/CEO
Jennifer is the author of From Cubicle to Cloud and Founder/CEO of Complete Controller, a pioneering financial services firm that helps entrepreneurs break free of traditional constraints and scale their businesses to new heights.
Brittany McMillen is a seasoned Marketing Manager with a sharp eye for strategy and storytelling. With a background in digital marketing, brand development, and customer engagement, she brings a results-driven mindset to every project. Brittany specializes in crafting compelling content and optimizing user experiences that convert. When she’s not reviewing content, she’s exploring the latest marketing trends or championing small business success.
Every associate’s needs differ based on factors such as firm size, years of practice, geographical region, and available resources. Any organization should be clear about its goals and objectives regardless of size or nature. A simple personal sales and marketing plan can help businesses determine what to focus on and where to spend their time and money.
Drafting Your Personal Sales and Marketing Plan
When you draft your personalsales and marketing plan, know it cannot be a “universal” plan. You must keep your ultimate goal in mind, which is to succeed. At the same time, don’t overdo it by pushing yourself too far in a short period. Remember, you are in for a marathon, not just a sprint.
Having planned your activities, take a calendar and lock in essential dates and deadlines. All resources, including executives, associates, and admins, should work together to create an effective personal sales and marketing plan.
Setting Goals: The SMART
Your personal sales and marketing plan should not be formally documented but well-defined and communicable. It should identify goals so that it can convey your business objective to every team member.
When making a plan, formal or informal, choosing a SMART goal is the way to go. SMART is a widely used concept in management and planning. SMART goals are acronyms for Specific, Measurable, Attainable, Realistic, and Timely. Many marketing experts use an additional ‘T’ to add tangible to the equation.
Identifying Your Prospects
Identifying where to start and who to target can be quite challenging. To begin, when making your personal sales and marketing plan, you must analyze your existing contacts or customer lists. The effectiveness of your marketing and sales efforts is based on a good contact list. Your contact list should include people you have known, met, or plan to meet. Everyone can be a prospect, from an existing client to a referral source.
You should aim to get as much information as possible. It is a good idea to include how you know the contact, i.e., where you met the contact, mainly when you were introduced to another source. It is advisable to categorize your contacts as a referral source, client, or prospect. Investing your time in maintaining a well-organized contact list will save you time, effort, and energy in the future.
The next step in preparing a personal sales and marketing plan is to use your contact list to identify prospects. Determine who directly or indirectly influences organizations and people who may need the services you offer.
Proper prioritization is necessary to be successful in making a plan that assists in business development.
Measurements of Success
Several metrics can help you keep track of your progress. These metrics vary from firm to firm, but the general purpose of any marketing plan is to maximize your outreach. Generally, you must monitor your conversion rate, number of qualified leads, referral rates, etc. These metrics make a plan more tangible and allow you to identify your areas of weakness, if any. The best strategy is to review your plan every six months and make changes as needed.
Making a plan is your first step toward success. Your personal sales and marketing plan can be vital in building your credibility and clientele. Remember, the plan should serve as a guideline. Keep it simple, and focus on the substance rather than form. With the right plan, you can identify and capture opportunities.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
A fine financial management structure depicts how an entrepreneurship business is doing and why. A well-organized system for bookkeeping is critical to establishing procedures to manage and control finances. Financial management is the system that places digits to work for a successful business. Financial management is used to formulate decisions that improve business operations and make them more successful.
Advantages of Financial Management
Financial management makes you a better macro manager. These are the advantages gained if you ace financial management.
Turning your business around requires proactive management. This entails swiftly securing business debts, devising an efficient financial plan for investor presentations, and accessing quality tools for informed financial decisions. Wise investment in fixed assets, streamlined inventory and accounts receivable management, and bolstering working capital are key.
Additionally, setting clear growth goals, optimizing gross profit margins through strategic pricing, and trimming direct labor and supplier costs are vital. You ensure more efficient business management by reducing administrative and overhead expenses and planning for taxes and worker settlements. Lastly, executing sensitivity analysis on fiscal variables ensures preparedness for various scenarios.
Developing a System for Financial Management
The first step is to create the financial statements. For proactive management, you need a plan in which a monthly generation of financial statements is done. This statement needs to include:
Income statement
Balance sheet
Cash flow statement
This information can be extracted from bookkeeping, bank statements, and invoice receipts.
Profit Doesn’t Characterize Success
In financial management for entrepreneurs, profitability doesn’t indicate success. Instead, growth indicates that a business is excelling and on the right path. Profit is the ultimate goal for sound entrepreneurs, but business growth is critical to determine how the business is doing.
Identify What Metrics Affect the Business
Identify the financial metrics that are universal and applicable to every business. Closely look into your business and identify specific metrics that affect your company. The universal metrics are revenue, operating expense, money on hand, gross margins, etc.
Don’t Drop Capital on Dumb Mistake
Efficient bookkeeping will help you assess your mistakes and where you are losing money. Identify all areas where money wastage is avoidable because early profits are more worthy in entrepreneurship.
Carry Out a Cost Review
An audit of the business should be done because you can only monitor some of your employees all the time. This should be done at least quarterly to examine your expenses and how to justify them closely. Audits also reduce the risk of fraud.
Make Your Time Count
Entrepreneurs have to do many tasks themselves due to small budgets. They have to maintain bookkeeping, run payrolls, etc. Entrepreneurs do things themselves to save money, but in reality, this time should be spent on the growth of their business. Use technology to save your time.
The monthly financial statement can be generated through the latest automated software package specially designed for accounting. These are to be used with your manual bookkeeping system. You can also employ internal or external bookkeepers to provide monthly financial statements to save time.
Build a Method to Track Success with Time
Every entrepreneur must have a system to assess success over time. This system is used to validate the financial management system and to reset goals if needed.
Conclusion
To grow a successful business as a sound entrepreneur, you must have a deeper understanding of your financial management system. Sabrina Parsons, CEO of Live Plan, believes “budgeting, forecasting, and planning are not just for start-ups. If you do this for an ongoing business, you’re going to grow 30 percent faster, you’re going to be more successful and your numbers are going to mean more.”
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Threats to e-commerce in cyberspace are on the rise. Every day, several websites are hacked, resulting in data theft or complete data loss. Businesses have problems keeping their e-commerce sites safe from hackers and other risks such as ransomware.
Cyber security for e-commerce sites is not an easy task. Managers and business owners often do not have technical training, and the lack of information can discourage even the most cautious and security-conscious business owners. This guide will be helpful for managers to secure their e-commerce websites and overcome security obstacles.
Identify the Most Vulnerable Areas
To protect a business from any threats related to cyber security, the initial precaution to consider is to identify the vulnerabilities of a website and the company it represents. If it is challenging to identify weaknesses, think about how these issues can be fixed. Is there a lack of knowledge about the data type the company stores? Knowing its vulnerabilities, increasing cyber security for E-Commerce sites is challenging without proper information about the data type.
Businesses have crucial data related to the company’s intellectual property, customer relationship management, essential financial information, and inventory management.
Thorough Mapping of the Entire Business
Carry out a comprehensive mapping of all of the processes performed by staff members. Gather, secure, and properly dispose of this data to avoid threats to e-commerce in cyberspace. Information can be stolen from various transit locations. Considering the negative effects of a cyber security breach on the business, employees, and relationships with customers and partners is essential. The next phase is to start putting precautions in place, such as providing adequate protection to the computers and website servers.
Protection for Computers and Web Servers
Virtually all the work that allows a business to operate goes through computers and other devices. However, these devices are always connected to the internet and a local area network, which makes them susceptible to a cyber attack. Hire an I.T. service to provide adequate protection protocols for the computer equipment and servers to enhance the cyber security of your E-Commerce site.
Software Updates
Computer systems used by an e-commerce site are pretty vulnerable to an attack. Ensure their safety by keeping all software updated. Hackers are looking for loopholes in the software, exploiting the flaws to break into the system. Hackers have different motives for hacking into computer networks or websites. The most common reasons behind a cyber attack are that the hackers want to make their political stance clear, they want to make some money, or they are simply hacking because they have the capabilities to do so.
Hacking and ransomware are intrusions that can cause considerable harm to any business. Hence, they are threats to e-commerce in cyberspace. Hackers can steal crucialinformation like credit card numbers, social security numbers, and identities of customers, clients, and employees. The best approach to evading becoming the next victim of hackers is to regularly update the software to improve cyber security for e-commerce sites.
Anti-Virus Programs
Viruses can do many things; they are malicious, and a virus can infect a computer system or an entire network. In general, they access essential data and delete or modify it. The computer virus spreads by making several copies of itself in email messages hidden in attachments.
If a computer on a network receives a virus, it can spread quickly and infect all computers and websites of a business. The virus outbreak results in significant data loss. The two most hazardous forms of viruses currently in circulation are “malware” and “ransomware,” which are significant threats to e-commerce in cyberspace.
Some differences exist between malware and ransomware. The malware prompts the victim to download specific software, thus gaining access to the latter’s computer. It can access the same things as you can on the computer, take confidential information, or spam an email address.
Ransomware is a malware type that, when launched successfully, can deny access to the targeted computer and prevent the user from accessing crucial data until the ransom is paid. Ransomware works by forceful encryption of your data; once the encryption is complete, it requires a special key that the attacker holds. The attacker threatens to destroy or delete the data until the ransom is paid.
The WannaCry cyber attack is an example of ransomware. Paying the ransom is not necessarily the answer. There is no assurance that hackers can unlock the files. Anti-virus programs must be updated regularly to avoid attacks like WannaCry. Businesses need to take precautions to increase cyber security for their E-Commerce sites.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
Each organization requires an inventory to carry out the various activities to achieve its objectives as a successful business. Stock inventory is created when items are in standby mode before they are used or sold. A stock of items can be found at any stage of the process, initially as raw material, then processed stock, and finally, finished stock.
Types of Stock Inventory Management
Businesses rely on different types of inventory to conduct their operations. Some of the most common types are:
Raw Material Inventory – Materials intended for production. This inventory allows the organization’s cost, production time, and priorities to determine continuous production and its size.
Work In Process Inventory – Materials in the production line waiting between different workstations. This inventory includes products that are allotted to different processing times of workstations.
Finished Goods Inventory – Inventory of finished products intended for sale and awaiting customer delivery.
Inventory of Supplementary Materials – Materials that do not directly participate in production but are necessary to complete the process. For example, office supplies, packaging materials, and other products are included in indirect production.
Costs Associated with Inventory Management
Costs associated with inventory management differ depending on the production process and type of finished product. Following are costs related to inventory management for adequate bookkeeping records.
Cost of Labor – Includes all costs associated with those responsible for managing inventory. This cost includes salaries and wages paid to warehouse managers, clerks, and inventory holders.
Cost of IT – Includes purchasing and maintaining computers and software.
Cost of Management – Includes building procedures and approving and assimilating them into the system. For example, storage procedures, handling procedures, and delivery procedures.
Benefits Derived from Inventory Management
There are several benefits taken from effective inventory management for the success of a business and proper bookkeeping. Savings on inventory maintenance help optimize costs associated with inventory maintenance. They also include expenses related to repeat orders on other products.
Meeting supply times assists in proper inventory management. It enables ongoing production and meeting schedules and delivery times to be determined. Timely delivery will lead to additional orders and new customers for the business. This indicates that proper inventory management is effective in helping the company succeed.
Maximum utilization of production factors is another benefit of stock inventory management. Proper inventory management will enable a continuous production process and prevent downtime, delays, and idle time in the production process.
LIFO Method – Last In, First Out
This inventory management method is also known as the stack method. The LIFO method determines that the last product that enters the inventory will be the first to be exported. LIFO is an effective method for products with a long shelf life.
FIFO Method – First In, First Out
According to FIFO stock management, the first product that enters is the last product that leaves the manufacturing facility. It considers the product’s shelf life and the validity of the warranty received from the supplier against the product.
JIT – Just In Time
This is one of the most common inventory management methods for products with high maintenance costs. According to this method, a company will order products from the manufacturer precisely at the time of purchase. According to consumption, inventory management is the most economicalmodel for inventory management but requires a high level of control and analysis for demand forecasting and delivery time management.
Inventory Management and IT Services
Inventory management software allows a business to track every exit and entry from the inventory of items in the various warehouses of the organization. Inventory management software is a system module that includes sales and purchasing modules to enable data integration and greater manageability, control, and analysis for maintaining costs associated with inventory management.
Linking the IT Sector with Warehouse for Effective Management
The warehouse and inventory management software will be essential to the organization’s inventory mechanism. The warehouse ensures proper maintenance of the various materials entering the facility, enables adequate inventory management, and provides exemplary service to the various factory departments. Inventory management software should allow quantitative inventory management and serial numbers for stock inventory management.
When done efficiently and professionally, warehouse management is one of the most essential conditions for successful logistics system management, stock management inventory, and bookkeeping. Both play a decisive role in helping a business succeed. Here are everyday activities that are carried out in a warehouse.
Handling of deliveries from suppliers
Inventory counts and complete control of inventory levels
Preparation of inventory and supply to various departments through transportation systems
Maintenance of physical conditions such as temperature, humidity, and pressure
Proximity restrictions for other materials
Regular maintenance
Receiving finished products from production
Receiving orders from customers
Preparing shipments to customers
Inventory Management with Serial Numbers
Inventory management according to serial numbers enables trackingtransactions of every item and managing responsibility with the supplier and customer. Inventory management software allows a company to analyze inventory movements, such as displaying sales of items according to different periods per business needs. The software must provide information on the dead stock (unsold inventory) to alert the business of missing items when an item falls below a specified minimum level to reduce costs associated with inventory management.
A crucial part of inventory management software should be the ability to manage exchanges and returns of the customer. The inventory management software provider should be able to perform a variety of actions against any return of a customer or return to a supplier. For example, actions such as withdrawing a return certificate for monetary credit, replacing a product, substituting product X with product Y, and exchanging with withdrawal of liability apply if the product is under warranty.
How Can Software Help in Stock Inventory Management?
Inventory management assists with business inventory, tracking the entry and exit of items from stock and noting the speed and profitability of each sale. The inventory management module consists of a price list for each customer. The software can be helpful in the calculation of profit per invoice.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.
