A colleague of mine recently brought this to my attention. The early snowstorm in the Northeast a few weeks ago reminded her of the city of Yekaterinburg, a large city two hours east of Moscow by air that often sees snow in October all the way through May. The western border of Siberia is a few hundred miles to the east. In Yekaterinburg, there are many small businesses whose owners need to keep their accounting books just like you do. However there are a couple of twists as you might imagine.
The old Russian accounting system was built for one purpose: to calculate taxes. And the tax system is complicated, expensive, and volatile. In the 1990s, about 600 new laws were published every year (just in case we think U.S is the only country that has a crazy tax system). The Russian government has broad powers to garnish business accounts, and many transactions are handled in cash to avoid this capability. As a matter of fact, it was quite common for small businesses to maintain three sets of books:
- One “official” set of books for the government.
- One for payroll which was mostly done in cash.
- One for management to see what was really going on.
It’s interesting to see whether QuickBooks could handle such data requirements. At any rate, it would need to be QuickBooks in Cyrillic to support the Russian alphabet. Microsoft Excel is definitely available in Cyrillic; I’m not sure Intuit has any plans for a Cyrillic version any time soon, which brings up another challenge: there are not too many plug and play accounting systems available in Russian.
Another challenge in the new, turbulent post-perestroika economy — inflation. Lending rates ranged between 130% and 200%. That’s pretty brutal to profit margins. What’s worse, a loan has to be paid back in three months. A company needing cash for several months is forced to find a new bank every three months to pay off the old loan and lend it the money for the next three months.
Until 1992, Yekaterinburg was a closed city: No foreigners were allowed to visit for reasons of national security. Concepts that we take for granted in America, such as profit and efficiency, are relatively unknown in Russia. There is no Russian word for “efficiency.” Imagine describing efficiency to an employee who has never heard of the concept or the word.
The chief accountant, who is often a company officer, is usually educated as an economist, which is the closest profession that Russia has to accounting until recently. There is a great hunger for management accounting and reporting because there wasn’t anything like it.
Sometimes it’s a breath of fresh air to experience a new perspective. In the U.S. we don’t have to keep three sets of books; one is quite enough for most of us. It’s illegal to make payroll in cash in most states. We have about half a million CPAs and far more bookkeepers to help us with anything we don’t understand. Most of them are quite efficient, and that’s a lot to be grateful for.
If we can help you with anything that feels foreign to you in your accounting system, please call on us anytime.
If your accounts receivable balances are edging up and getting older and older each month, then it might be a good time to bring out the aging reports. But what if we looked earlier in the cycle to see what we could do to collect the sales even sooner? Let’s take a look at five potential changes you can consider making that will speed up your cash flow, reduce aging receivables, and possibly reduce lending costs in your business.
Do your prospects sometimes balk when you quote your prices? Do you feel you’re losing business because your fees are too high? The problem might not be your prices; it might be the way you’re presenting them to potential clients. Many business owners blame a lost sale on price, but only a small percentage of customers are truly price-sensitive and will make a decision based on price alone. That means the majority of the market buys on value, not price, and that’s what we need to move the focus to when we present prices.
Does it seem like you need to accomplish more in less time than ever before? Just about every small business owner I know is overwhelmed with everything they need to do. Many factors are contributing to this feeling: new technologies, increased government regulation, a need to market harder, and less access to capital are just a few examples.
You might have routines and systems to help a new employee settle in, such as payroll forms and training manuals. You might also have some procedures set up for when you start doing business with new vendors, such as asking them for their tax ID paperwork and having them submit invoices to your standards. But what about onboarding new clients? Most entrepreneurs don’t think about systematizing that process.
Is finding enough time to do everything you need to do one of your top five small business challenges? If so, you’re not alone; just about every entrepreneur lists “time” as a challenge they face today in running their businesses. It’s not uncommon to feel stressed and overwhelmed at everything you need to do.
Restaurants do it beautifully. “Did you leave any room for dessert or coffee?”
The fall months are a great time to rev up your business revenue. Many business owners are freshly back from retreat or vacation, and they’ve had time to refresh and rejuvenate themselves and their staff. Now it’s time to benefit from all that creativity that’s been unleashed and put those ideas to work.
Many of my clients that had been to my old office are aware of the extensive library of personal, professional and spiritual books, tapes, CDs and videos that I have accumulated over the last 20 years. The audio programs tend to be the most useful for me since they are so easy to listen to while I’m driving, cooking or cleaning. Okay, it’s true. Watching The Secret with other enthusiasts and a big bowl of popcorn would be my idea of a great evening, but I’m a little passionate. Since I was recently asked the question, I thought I would share with you five of my favorite leaders in the personal development realm. 
Summer is a great time for new projects that revitalize our lives. If your spouse or family is creative, you may have a lot of those summer projects that require your time and attention at your home this season. But what about a summer project for your business? It could be just the thing to spice up your business and help you rejuvenate your staff and your energy at work.
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