Financial Management

Is It Possible to Have Negative Net Income and Positive Cash Flow?

Have you ever heard of a business losing money but still having cash in the bank and continuing to generate cash monthly? It may sound like a financial impossibility, but it’s actually possible and happens more often than you might think.  While this concept might also seem confusing initially, it’s an important aspect of financial […]

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How Hiring an Interim or Part-time CFO Helps During Times of Growth or Stress

Source: Corey McLellan, Bridgepoint Consulting In today’s volatile economic environment, organizations must react quickly to changing market conditions without compromising their financial health or competitive edge. But all too often, these periods of rapid growth and change introduce financial and organizational chaos, hindering an organization’s ability to forge their path forward – and sometimes, they

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Accounting for Prepaid Expenses – Challenges & Best Practice for Small Companies

From initial recognition on the balance sheet to systematic expense realization, understanding prepaid expenses is key tomaintaining accurate financial records and ensuring fiscal health. This article not only clarifies the concept but also offers insights into the challenges and best practices associated with managing these future-focused expenditures, making it an essential read for anyone involved

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Litigation Financing: Considerations for Small Companies Deciding Whether to File a Complaint

Litigation financing enables individuals and businesses to pursue legal action despite financial constraints. This provides them with the funds needed to challenge bigger opponents. Investors back these cases in return for a portion of future judgments or settlements. This method promotes fairness and accountability while addressing barriers to legal representation. While gaining popularity, understanding the

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Key Supporting Investments Business Owners Should Consider

Running a business is hard work – always and in virtually every case. As a business owner, every decision you make, especially regarding investments, can significantly impact your venture’s success and sustainability. It is important not to overlook some basic supporting investments which can fortify your business for the long term.   We’ll talk about

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Owner Financing of Small Companies – Debt or Equity Considerations

Corporations can generally deduct interest on debts for federal tax purposes. A valid obligation exists if the parties intended to create a debt, and the debt is enforceable and unconditional. In contrast, a capital contribution is a direct or indirect contribution of cash or other property to the capital of a business entity. Generally, a

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Why Business Valuations are Helpful (& What do they Typically Cost)?

During the course of building and operating your small company, you may want to know the value of your business for several reasons. For young, high-growth companies with an inclination to issue incentive management compensation in the form of stock options, the most common reason is compliance with IRS code (409A). This tax compliance requirement

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