The term “gig economy” describes one-time tasks and services performed for a fee, as opposed to traditional employer-directed jobs performed for a wage. Many people conversationally refer to gig work as “gig jobs,” which can confuse things. Gig work is not a job in the traditional sense. Gig workers are independent contractors, not employees. Most…
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What Is the SBA Guarantee Fee? How It Works & Examples
Small Business Administration (SBA) loans are issued by participating lenders designated by the SBA but are guaranteed by the government in the event of a default. To cover the potential costs of a default, an SBA guarantee fee is often included as part of the costs associated with getting a loan. The amount of this…
What Is Invoice Fraud? Examples & Prevention
Invoice fraud is a business fraud wherein scammers send fake or falsified invoices to businesses.
Discovering invoice fraud is alarming, especially for businesses relying on technology in their operations. Without understanding what invoice fraud is and how to prevent it, you’ll be at a higher risk of falling into these traps. In this article, we’ll discuss the different kinds of invoice fraud and give you some tips on how to…
10 Effective Customer Service Channels for Small Business
As a small or startup business, it’s imperative that you offer customers as many different customer support channels as possible. Not only is it important to reassure them that their investments in your products or services are secure, but it’s vital that you’re able to provide support in case something goes wrong. Thankfully, there are…
What Is Employee Advocacy?
Employee advocacy is when employees promote the brand, products, or services of the company they work for through social media, word-of-mouth, or other personal interactions. However, it’s more than simply sharing content or words; it’s authentic—an effort done because employees genuinely believe and advocate for the company, as they feel valued by it and are…
What Is the Meals & Entertainment Deduction?
If you own a business, you may be able to take the meals and entertainment deduction to lower your tax liability. Generally, you can deduct the cost of business-related meals and meals consumed while traveling overnight. Entertainment costs aren’t deductible. The purpose and beneficiary of the meal are primary factors in determining which expenses you…
What Is an Owner’s Draw and How to Record It?
An owner’s draw is a withdrawal of business funds by a business owner for personal use. It’s recorded as a reduction in the owner’s equity on the balance sheet, not as an expense on the income statement.
To record it, debit the Owner’s Draw account while crediting the Cash or Bank account from which you took the owner’s draw. It’s essential to track all draws throughout the year for accurate financial records and, at the fiscal year’s end, transfer the total in the Owner’s Draw account to the Retained Earnings account. This…
What Is Cash Skimming? Examples, Detection & Prevention
Cash skimming is a business fraud wherein an employee pockets customer payments before recording them in the accounting system.
Businesses with very relaxed or nonexistent internal controls over cash transactions are at a high risk of skimming fraud. The best way to detect and prevent cash skimming is to implement a robust internal control system with a strong emphasis on proper and adequate transaction documentation. In this article, we’ll talk about how cash skimming…