Tuesday, January 12, 2010

Importance of a Paper Trail

Well "Cool V" & "Money Mike", decided to follow-up this week's show on their own, it was about time, that we get listen to these experienced professionals follow-up on last week's show, with some serious insight. We want to first thank all of you that have been following and supporting the movement, giving "Cool V" and "Money Mike" more reason to keep on giving. If you missed this week's show and want to get your notepads out, it's time to increase the bottomline!!!

MONEY & MUSIC SHOW - GET YOUR FINANCIAL TIPS RIGHT HERE!

Click on the Money & Music Show & Enjoy the Information

Take a look below as "Cool V" sheds light on what he said during the show from the Marketing side of your business, while "Money Mike" as always focused on the financial importance of a Paper Trail for a variety of reasons. If you were not able to spend the time listening to the show above, the basics are here below:

Importance of a Paper Trail

Is not only for your accountant, your banker, your attorney, financial advisor, but most importantly YOURSELF. A basic business question to any business owner besides showing your Tax Returns, can you provide your P&L? What is a P&L?

Definition of a Profit & Loss Statement
An official quarterly or annual financial document published by a public company, showing earnings, expenses, and net profit. Net income is determined from this financial report by subtracting total expenses from total revenue. The profit and loss statement and the balance sheet are the two major financial reports that every public company publishes. The difference between this statement and the balance sheet deals with the periods of time that each one represents. The profit and loss statement shows transactions over a given period of time (usually quarterly or annually), whereas the balance sheet gives a snapshot holdings on a specific date. also called income statement or earnings report.



The point here is, yes this is the definition, but how can you expect any bank, loan officer, investor, etc...provide you a loan or investment when there is no Paper Trail of Proof when showing your Profit & Losses for the year. It's like buying car, but yet have no Deed/Title to show for it, who owns it? If so, prove it!!!

As a business owner, the belief many times is it's safer to take Cash, because someone can't Default on Cash, or like the saying goes Cash is King. The reality is, how many times does someone give you cash, and by the end of the week, you have nothing to Show for it, don't even know where it went or how it was spent. This is the Reality of Cash, imagine you run your business like this. Do you really think because it's Cash, it's better than a check, money order, or wire/paypal? If your answer is I can do more with Cash, then you've already shown that you are not Serious about your Business, and so why should anyone be serious in Doing Business with You.

Please do not take what's written here out of context, we understand there are businesses that only deal with cash, just make sure at the end of the day, you can show a paper trail or account for what came in and what went out, like they say clear the register. So before any of that cash is spent, a Deposit with Receipt and Logged into your Daily Cash Log is accounted for.

"Cool V" talked about Reputation, what kind of reputation does someone really have if they can't provide a Business Check, with a Business Name on it, or Personal with their Real Name & Address? Are we suppose to take your business seriously, with alias names or only able to do business in Cash. You may even want to rethink is that business or person someone you want to be doing business with if they don't have a business checking/personal checking account, and only accepts CASH. If anything, you portray an image of having to HIDE something. If you do a 100 shows and receive $500, that's $50,000, ask yourself, with Cash for each show, can you prove it? Forget anyone else, can you prove it to yourself? Do you know if you are profitable?

So at the end of the day, begin to change your Business Model, and accept Recordable Transactions Only.. ie...Check, Money Order, Paypal, anything that can be recorded & saved for your accountant or tax time, most importantly for YOURSELF and your Business.

Remember, "If you have to pay more Taxes, that is a Good thing, it means you Made that much more Money". 2010, start the year off on a new foot, hold your self and business accountable & at the end of the year, pull out your Paper Trail, and do your P&L, at least you will know if you were or weren't Profitable, most importantly what you need to FIX in your own operations.

...till next week
have questions? need answers?
email: moneyandmusic@gmail.com
Serious Inquiries Only

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