Information on this page was gleaned from: The Business of Graphic Design, A Professional's Handbook
Hilary Ashworth, Supervising Editor
2001, The Associtation of Registered Graphic Designers of Ontario
ISBN: 0-9688734-2-1
Contact the R.G.D.
372 Richmond Street West, Suite 303
Toronto ON M5V 1X6 Canada
Telephone: 1.888.ARGDONT (274.3668)
in Toronto: 416.367.8819
facsimile: 416.367.9150
e-mail:info@rgdontario.com
Business statements information and templates courtesy of:
CCH Business Owner's Toolkit.
Other Financial Documents:
Income Statement
Loan Application, Bank Review Form
Managing Your Business
Accounting Records
"The basis of business taxation is all income minus all expenses spent generating that income. Obviously, the higher the expenses, the lower the amount on which your tax is determined and the lower your taxes. If you do not record your expenses, you will pay more taxes."[ R.G.D. ]
As graphic designers, we learn how to practice our craft with years of education and real-world experience. We are experts at what we do. For the same reason, we should let accounting experts do their thing. Trust no one but a pro with control of your accounts.
Financial Statements
Financial statements can be prepared by a Chartered Accountant under one of the following engagements. [...]
Compilation— Notice to Reader Report
The accountant receives information from you and arranges it in the form of a financial statement. No attempt is made to verify the accuracy or completeness of the information provided.
Review— A Review Engagement Report
A Review Engagement Report provides some assurance of the accuracy of the financial statements.
Audit— Auditor's Report
An Auditor's Report provides a higher degree of assurance.
Cash Flow Projections
A cash flow projection identifies your anticipated income, the amount of money that will be needed to pay bills, and the cash surplus or shortage which will result. Based on this projection, you can plan to invest the excess or fund the deficit. A reliable cash-flow projection can bring order to your business and provide you with peace of mind.
The Balance Sheet
Also called the statement of financial condition, it is a summary of a company's assets, liabilities, and owners' equity.
Cash Flow Budget Worksheet
The Cash Flow Budget Worksheet is used to project your business's cash inflows and outflows over a six-month period of time. It has many important uses. It can predict the ability of your business to create the cash necessary for expansion or to support you. It can project your business's cash inflows and outflows and predict your business's cash flow gaps — periods when cash outflows exceed cash inflows. It can also be used to prepare a formal cash flow budget for your lender to help assure the lender that you will have the cash available to pay back the loan.
The Cash Flow Budget Worksheet template in the attached file was designed to make it easy for you to prepare a cash flow budget. The worksheet has been set up and formatted for budgeting your cash flow for six months and contains most of the cash inflow and outflow categories. Just plug in your numbers and print the worksheet. You can modify it to fit your own needs.
Customer Statement of Account
Do you extend credit to your customers? If you do, two things are essential to maintaining control of your receivables. First, you need to maintain an accurate accounts receivable ledger for each customer — in other words, an up-to-date record of each customer's charges, payments, and balance due. Second, you also need to be able to send an accurate monthly statement to every customer who owes you money.
The template file combines the accounts receivable ledger and customer statement of account. You can use it to keep track of charges and payments on each customer's account and then, at the end of the month, send the same form to your customers, reminding them of their balance due.
Monthly Bank Reconciliation
You may find yourself spending lots of time every month reconciling your bank statement and still aren't able to nail it down to the penny. This form can help make the process far less painful and much more accurate, and will even do some of the clerical work for you. Just plug in the account balance shown on your bank statement, your deposits in transit, your outstanding checks, and your account balance according to your books in the spaces provided. The reconciliation will add up all the amounts, and immediately tell you if your books agree with your bank balance. If they don't agree, you can get right to the business of finding your errors (sorry, the spreadsheet can't do that for you)!
New Business Cash Needs Estimate
This set of worksheets will enable you to compute the amount of cash you will need to start your new business and keep it, as well as your personal expenses, going for the first 90 days. The worksheet is broken down into three parts. The first part computes the amount of cash you will need from day one of planning your business to day one of opening the business for customers. The second part of the worksheet computes the business's cash needs for the first three months. The third part covers your personal living expense cash needs for that same period.
This worksheet set lists all the descriptions of the cash needs of the new business. If you need additional categories of expenses, you can quickly modify it.
Sample Collection Letters
Personal visits, telephone calls, and letters are the three most common collection approaches that small business owners use to collect past due accounts. Since many small business owners simply don't have the time or opportunity for personal visits or telephone calls, a letter is often the method of choice. The provided template file contains three sample collection letters, each designed with a different purpose. Each succeeding letter is slightly more strongly worded than the previous one — ranging from a friendly reminder to notification that you are turning over the matter to a lawyer or collection agency. You can easily modify any of these letters to fit your situation or your personal style.
Trial Balance Worksheet
Whatever kind of business you run, you have to close your books at least once a year to prepare an income tax return — or more frequently, if you want to get a better handle on how your business is doing. An important part of closing your books is preparing a trial balance — in other words, a list of all of your bookkeeping accounts and the balance of each at the end of the period — to see if your books are still in balance. If you are already doing this, you know that it is tedious and time-consuming; if your accountant is doing it, you know that it is an added expense.
The trial balance spreadsheet contained in the supplied template is designed to save you time and money in preparing the trial balance yourself. The spreadsheet contains over 80 common account titles in a trial balance format. Simply plug in your balance for each account and the spreadsheet will automatically add up the debits and credits, and tell you if your books are out of balance (and by how much). Since it is a spreadsheet template, you can add or delete accounts or otherwise modify it to suit your needs and preferences.