Rick Reed


As we come to the conclusion of 2008, many businesses have lost money in this year. The economy for 2009 looks very volatile and some industries may start to recover in 2009, while others may take a little longer. One positive area to bring to the table is that the price of oil has decreased significantly and regular gas prices have come down below $2.00 or so per gallon depending upon your location.

The question through this difficult year where losses have mounted up, why do you have to tax plan? If you were profitable in year 2006 and/or 2007 and paid business taxes in those years, you may be entitled due a tax refund in 2008 to recover part or all of these monies paid in previous years. This tax recovery is called a net operating loss carryback claim…This situation applies to proprietorships, corporations, limited liability corporations, and so forth.

The first part of this discovery phase is to identify whether you are a qualified individual and/or company to recapture monies paid in from prior years…It would be a good idea to obtain from your accountant, bookkeeper, CPA, or your own in house books an updated balance sheet and profit and loss statement for 2008. Additionally, you may want to locate your 2006 and 2007 either personal and or corporate tax returns and review the past years information. If you have paid business taxes in those past years and are in loss situation for 2008, there is a good chance you will be able to recover either partial or all monies paid to the

government for 2006 and/or 2007.

.If you are a farmer and have losses in 2008, you should locate your 2003, 2004, 2005, 2006, and 2007 prior years tax returns because your eligible carryback years extend back for five years. Everybody else, for the most part, can carry back their business losses two years…

Once you have located your prior years tax returns and reviewed the business taxes paid into those years, compare this to the 2008 Profit and Loss Statement. It is good idea that your 2008 information should be current and accurate because it could have a major effect on your decision making. Assuming you are in a loss situation for 2008, you may want to plan you year end cash flow accordingly. For

this illustration, we will assume everyone is on a cash not accrual basis accounting system. Because of your tax situation and the possibility of recovering a tax refund back in early 2009, you may, if cash flow permits, pay more bills in December 2008 than the normal January 2009 payment cycle. The bottom line here is that a qualified professional should be assisting you at this stage because of the cash flow and tax effect though the period ending December 31, 2008. The professional cost vs tax recovery benefit could be a big plus to you.

This carryback claim process is important because it can generate needed working capital if the economy hasn’t recovered in your niche for 2009. Additionally, with all the available acquisition and financing deals available for commercial vehicles, construction trucks, office equipment, computer systems etc, these monies could be used as a down payment or a combination of working capital and acquisition funds.

These carryback claims can be carried back two years, except for farmers, five for them, and if needed carry forward for twenty years. It doesn’t matter what your business structure is…There are exemptions to these rules and you should consult your tax professional for advise on these carry back and carry forward rules.

For illustration the types of industries that would qualify for these carryback losses include construction, trucking, farming, restaurants, all retail shops, mail centers, franchise operations, consulting firms, manufacturers, wholesalers, service providers, This is obvious a partial list of qualified businesses. In addition, the type of entity doesn’t play a role in these carryback claims. There are a few exceptions to the rules, therefore consult a good tax adviser.

In addition to the carry back rules, there are numerous business and individual tax changes for 2008. It would be a good idea to get a head start at the end of this year to understand them and see if there are any you want to take advantage of before December 31, 2008.

In conclusion, 2008 was a trying year for many, but this recapture of tax monies shouldn’t be ignored. If done properly, you can get a head start on 2009 and have a profitable and less stressful year… … Who says Tax Planning is boring

Victorino Q. Abrugar


income or net profit (the result after all revenues, costs and expenses have been accounted for). This income performance is used to be known as the results of operations of the entity.

Different from common entities, a non-profit organization does not prepare an income statement or a profit and loss statement since it is established not to earn money but to carry out its purpose like charity, environment care, cultural development and other activities to help the society. That’s why they are usually exempted from income tax. The formal statement prepared by these organizations to show their performance is called statement of supports, revenues and expenses. A fund accounting method is usually used on these types of entities. Actually the statement of revenues, support and expenses are the same with the statement of income although the term income or profit is not used.

The information about the performance and profitability of an entity is useful in predicting the capacity of the entity to generate cash flows from its existing resources. It is also useful in forming judgment about the effectiveness of employing additional resources. Owners and investors of the entity use the income statement to determine if the entity made or lost money for a given period of time. In others words it is used to know if the entity is earning or losing. It also tells us if production and employment of products or services for sell will give us additional profit or loss.

The income statement is prepared “for a given period of time”. In other words, a period must expire before the performance of an entity can be properly measured. The income statement covers a period, unlike a balance sheet which is prepared as of given date or particular moment in time. For example a company that prepares financial statements on a calendar year December 31, 2007, its balance sheet should be dated “as of December 31, 2007” and its income statements should be dated “for the year ended December 31, 2007”. If financial statement is prepared only for a six-month from June 1, 2007 to December 31, 2007, its balance sheet should still be dated “as of December 31, 2007” since it is for the point of time, while its income statement will be dated “for the six-month period ended December 31, 2007” which means the statement is a report for the six month period time from June 1, 2007 to December 31, 2007.

The components of income statement are revenues, expenses and net income (the income after deducting all of cost and expenses during the accounting period). Revenues include sales of products or services. It may also be deducted by sales discounts or sales refunds. Revenues are recognized whether they are already collected or not. This is called the accrual basis of accounting. Revenue is recognized as it is earned regardless of being received or not. For example, a company that sells canned goods, the sales from canned goods to customers is recognized as revenue once the ownership of the goods is transferred to the customer regardless of whether the price money is already collected in the form of cash or cash in bank or not collected in the form of an accounts receivable. Revenue or income is defined as “increase in economic benefit during the accounting period in the form of inflow or increase in asset or decrease in liability that results in increase in equity, other than contribution from equity participants”. In other words, it is an inflow of future economic benefit that increases equity or capital, other than contributions by owners, proprietor (single proprietorship), partners (partnership) or stockholders (corporation).

Other sources of revenue includes income from rendering of service (accountant’s fees, lawyer’s fees, insurance agent commissions, talent fees, etc.); use of the company’s resources (interest, rents, royalties and dividend income); and disposals of resources other than products (gains on sale of investments, property and equipment and intangible assets).

An expense is defined as “decrease in economic benefit during the accounting period in the form of outflow or decrease in asset and increase in liability that results in decrease in equity, other than distribution to equity participants”. In simple words, it is an outflow of future economic benefit that decreases equity, other than drawing paid to proprietors and partners or dividend paid to stockholders.

Generally, expenses include cost of sales, selling expenses, administrative expenses, other expenses and income tax expense (if an entity is subject to income tax).The cost of sales is the direct costs attributable to the cost of products or services sold. In an analytical view, it is the sales after deducting your mark-up on the goods or services sold. Cost of sales is used to determine the gross profit amount and ratio of a certain entity. Gross profit is what you get after deducting cost of sales from your total revenues. Gross profit is computed by dividing your gross profit to your total revenues.

The cost of sales of a merchandising company is composed of goods available for sale (beginning inventory plus net purchases) minus ending inventory. While the cost of sales of a manufacturing company consists of raw materials used (beginning raw materials plus net purchases less ending raw materials), plus direct labor, plus factory overhead, plus beginning goods in process, less ending goods in process, plus beginning finish goods, less ending finish goods.

Selling expenses constitute costs which are directly related to selling, advertising and delivery of goods to customers. These include sales commissions, salesman salaries and traveling expenses, marketing expenses, advertising expenses, freight-out, depreciation of delivery equipment and store equipment, and other expenses related directly to selling activities.

Administrative expenses represent cost of administering the business. This includes all operating expenses not related to selling and cost of goods sold. Examples of administrative expenses include salaries of general officers and of administrative staff or employees, office supplies, taxes and licenses, depreciation of administrative building and equipment, insurance, amortization of intangible assets and doubtful account expense.

Other expenses or charges are those expenses which are not directly related to the expenses discussed in the preceding paragraphs. These include charges to income such as loss on sale of property and equipment, loss on sale of long-term investments and other losses.

After recognizing and understanding an entity’s revenues and all its expenses including income tax, we realize that what is left after deducting all expenses from all income is the net income or net profit if the entity is performing efficiently and effectively, and net loss if the entity is ineffectively and inefficiently employing its resources. However a certain entity having net loss for a certain period of time cannot be absolutely judged that it is performing poorly in doing business. A particular company may incur losses because of the fact that it is only in its early years of operations since its establishment. Therefore, it is always a wise move if we read and analyze income statement for a series of years instead of reading it for only a year or two year periods of time. There are also some qualitative factors that we might need to consider like its participation to our society and protection of our environment.

Linda Dawson


The Cash Flow Statement is made up of three sections. The first section is operating activities. Operating activities include your company’s profit or loss and non-cash items that affect your profit without affecting cash. Examples of these types of non-cash expenses are depreciation and bad-debt expense. Also included in this section are changes to your operating assets and liabilities. Operating assets and liabilities include accounts receivable, prepaid expenses, accounts payable and accrued liabilities. A common feature of operating assets and liabilities is these items have been reflected in the Profit & Loss Statement in a period different from the period in which they were paid.

The second section of the Cash Flow Statement is investing activities. Investing activities are items such as property and equipment or loans receivables. An interesting aspect of investing activities assets is that they, unlike operating assets, generally do not affect the company’s profit. In other words, investing assets do not represent revenue or expense items.

The third and final section of the Cash Flow Statement is financing activities. Financing activities are debt and equity items. If you increase or decrease your debt, that change is included in financing activities. Equity changes such a capital contributions or shareholder distributions also are reflected under financing activities. Like investing activities assets, financing activities liabilities and equity do not represent revenue or expense items.

The sum of the three sections: Operating activities, investing activities and financing activities is your cash flow for the period being reported. A positive number indicates an increase in cash and decrease indicates a decrease in cash. Now it’s time to take a closer look at the Cash Flow Statement and see why your cash flow is different from your profit.

Compare your cash flow to your profit. If your cash flow is higher than your profit, you are either liquidating assets or increasing your debt, which is negative for your business. On the other hand, it could be that you are increasing your capital, which is a positive for your business.

If your cash flow is less than your profit, you are increasing your assets, such as purchasing property and equipment for future growth or paying down your debt. These are both positives for your business. But it could mean that your money is being tied up in accounts receivable because collections have deteriorated and your business is weakening. Or it could be that you are decreasing your capital, which is a negative for your business.

Cash flow is an indicator of where you are spending your money and the future strength of your business. Small business owners generally do not realize the importance of comparing their past years Cash Flow Statements to measure their business growth. Some of them are ignorant of the basic rules that one should follow to compare their past Cash Flow Statement with the current one. So now that you are aware of these formulas take a few minutes and review your Cash Flow Statement. Compare it with last year and see how your business is progressing. You will be surprised at how much valuable information is contained in your Cash Flow Statement.

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www.FuneralFuturist.com Funeral expert, Robin Heppell, assists funeral homes and cemeteries by consulting with them on how to be more competitive and more profitable. He also helps them drive more website traffic and convert those visitors into preneed leads and sales. For more information about Funeral Business Management Consulting visit www.funeralfuturist.com

Yamen Shahin


This article teach you how to benefit in the management of the business using your presentation skills.

Before the presentation:

Knowledge of the characteristics of the offeree the most important factors to the success of the presentation, they lead you to determine the style and language to be used, and will it be: Official or friendly. Professional, technical or slang. General information or specialized. Total or in detail

During the presentation:

? Be sure to follow listeners by your eyes fair and balanced.

? Noted the actions of the present and careful interpretation of physical expressions of the audience.

? Understanding of the situation and conditions of the audience: air, as food, stress after the working day, come from travel, and others.

Elements of the presentation:

? Introduction

? Content

? Conclusion

A-Introduction:

Designed to pave the audience and informing them about the elements of the subject.

A good Introduction made clear to the listeners the nature of the subject matter, showing them what to expect from the presentation, and the expectation of the speaker from them.

Elements of the introduction:

? Extended greetings to the audience

? Introduce yourself

? Substance of the presentation (the title)

? Time of the introduction

Content of the introduction:

? Reference to what should not be expected from the presentation

? Reference to training aids, material science, literature ,….. And other

characteristics of successful introduction:

successful Introduction must lead to:

? Attract the attention of listeners

? Break the barriers and melting the ice between the speaker and listeners

? Make listeners feel the importance of the presentation subject

? Make listeners feel of their need to information provided

? Reduction of excess expectations of listeners

? Suspense to engage listeners on presentation.

how to start an Introduction:

There are many models of good beginning, including:

? The issue of Introduction: will speak at the next hour….

? Communication with the audience: I know that the weather today is hot and you are exhausted from traveling.

? A short story related to the subject of the presentation.

? An interesting information

? an interesting question: : How much of you need a good solution for business management?

? Explain the problem and then begin to put alternatives to solutions.

B-Content:

Is the central part and most of the presentation, which aim to:

? Retain the attention of viewers.

? Help them to follow up the ideas raised.

? Directed towards findings the results.

characteristics of successful Content:

To achieve the goals:

? Is planning to build or structure of the subject the way in which to convince the audience.

? Divides the content to points (Headlines) primary and secondary clear and logical sequence.

? Be used to clarify the means of a simple and expressive.

? Use appropriate language structures to link the transition between the parts of the presentation.

Building structure of Content:

There are several methods for dividing the content of the presentation, including:

? The division of time: past, present and future.

? Factional division: finance, human resources, production.

? Comparative division: the old system, the proposed system.

? division of alternatives: the first alternative, the second alternative, the third alternative.

? Division of gradual (upward or downward:)one of the most important factor, followed by …

? Network division: individual, institution, society.

Wait for my next article Business Management and Presentation Skills part 2 about Management in Business.