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Accounting Advice Is Key to Making the Right Acquisition
So you're looking to expand by acquiring another business. You likely know you need to conduct a thorough investigation of the targeted acquisition as well as your own resources. But you also will need to know exactly how the purchase will be a catalyst for enhanced profitability. In other words, know what you're buying. For this, you need good advice.

Such transactions are typically purchases of the assets of another operation - including intangibles, such as its trade name and customer base, which should play nicely with the brand image of your existing enterprise. In establishing a reasonable purchase price, hard assets like equipment and inventory are much easier to measure; interestingly, it's the intangibles that are the most complex factors in an acquisition.

Purchase price: The general discussion phase of an intended acquisition involves accepting the seller's verbal conveyance of revenue, gross profit, net profit, and asset values. After a purchase price is agreed to, the target business will present its formal financial statements. Note that recent quarterly financial data are especially valuable for assessing trends and seasonal factors.

Synergies and potential issues: In making a final decision, you'll want to blend the historical results of the targeted business with your current operations to identify cost reduction synergies and potential customer attrition under the new ownership. Projected revenue and expenses of the combined businesses should demonstrate sufficient cash flow to repay any debt incurred for the purchase, as well as generate a reasonable return on investment. Your accountant is the best resource for these calculations.

Tech Is Efficient But Human Interactions Make Us Happy
Angel Investor
Once, going to work meant meetings and lots of work-related interactions; today, there's been a huge jump in numbers of traditional (non-self-employed) employees who work remotely and connect to the office with technology.

According to, the percentage of workers telecommuting has risen 103 percent since 2005. And unlike in an office environment where opportunities for elevator chats and chance meetings abound, telecommuters aren't likely to exchange ideas over coffee or lunch.

According to a recent article on, "The more efficient we get, the less we interact."

And that may be making us sad and miserable. In her TechCrunch article titled "Why Increased Efficiency Will Make Us Miserable," Aja Frost has found lots of reasons for concern about technology's impact on our lives.

Research indicates that micro-interactions with "weak ties" - people we don't see often or know well - are connected to feelings of happiness and belonging; "when it comes to our happiness, socialization trumps efficiency," Frost says.

She cites a study by researchers from the University of Chicago in which some subway commuters were asked to talk to the person next to them during their commute. Others were told to "enjoy their solitude." The result: those who interacted with fellow riders found their commute was more pleasant.

It's spontaneous human interaction that makes us happy, not pre-planning a Skype session. But there is still a place for technology.

Frost's solution: balance. Don't work from home, she suggests; instead, download Workfrom and select a spot with great Wi-Fi and lots of opportunities for human interaction.

Sick of Business Travel? There May Be a Good Reason for That
While frequent business travel may look glamorous, if it becomes a nonstop activity it might also be making you sick.

As reported in a recent article in the Economist, researchers at the University of Surrey and Linnaeus University have discovered a host of problems resulting from this "darker side of hypermobility."

The study found that hypermobiles - primarily business travelers - may suffer in three ways: physiologically, psychologically/emotionally, and socially.

Some physiological effects, such as jet lag, are well understood, but others are less obvious, like increased risk of heart attack and stroke. Frequent flyers may also be exposed to higher levels of radiation (not to mention germs), get less exercise, and eat less healthily than their stationary counterparts.

The study also found that business travelers are more prone to stress and loneliness; stress occurs because "time spent traveling will rarely be offset through a reduced workload." And probably the work will keep piling up while they're away. Add to this the time away from family and friends, and it's clear how hypermobility can become a problem.

Business travelers who are apart from their spouses and children for significant periods of time may experience family breakdowns, and/or close friendships may also suffer from extended periods away from home; business travelers often want to spend all their free time with their families after a trip.

But it isn't all doom and gloom. For the most part, the hypermobile individual is also among the "mobile elite": they make more money and have better access to quality health care than the general public. And they're worldly.

Still, the next time you snap another selfie against yet another city skyline, consider its cost. It may be greater than its worth.

Numbers Tell Your Story: Make It a Good One
Love it or hate it, accounting for your results is a necessity for your successful business. But with some creativity, and an effective accounting system, you can make the process much less burdensome.

An effective accounting system drives a shift toward timely and accurate records while minimizing the bookkeeping involved.

Take tax time. If you scramble to piece together financial details at the last minute, you won't be able to give the process of assembling the whole year's figures the time it deserves. That may result in incomplete or inaccurate financial statements for the year gone by, and you won't want to make important decisions based on them.

The key to improving your bookkeeping experience lies in the following suggestions:

Become comfortable

Market conditions and consumer demand constantly shift, and your business plan will always require tweaking. Your financial statements reveal the story of the plan's good and not-so-good elements, so learn to read your story through the numbers. Develop an understanding of what's conveyed by the income statement as well as the balance sheet. Know why those figures are presented in a standardized format and what they mean. Recognize when the numbers are off because they haven't been entered properly.

Stay timely

Good financial records convey immediate information about the recent past, and having accurate information immediately available leads to sound decisions. Mistakes such as incorrectly categorized expenses, unexplained discrepancies, and figures that don't reconcile to outside sources can happen if you don't update your financial records as events unfold. As a result, your books are missing important elements of your business transactions. And these may not be recoverable; your memory of transaction details may fade with time.

Don't procrastinate; ensure you check your financial statements regularly. Accounting may not seem time-sensitive until a crisis occurs. Having your finger on the pulse is crucial to averting emergencies.

If it's broke, fix it

Above all, your business story is incomplete if the accounting system that renders the financial statements is shoddy. When your bookkeeping method consists of a pile of receipts and a pile of invoices, you're ready to move on to a more advanced process. But don't replace the piles with a clunky spreadsheet; it's a poor substitute for standard form financial statements.

Useful and timely financial information is the hallmark of a superior bookkeeping system. You could decide to rely on user-friendly accounting software, which is just as it sounds - easy for the user to get up to speed. The downside of this form of software is that you develop a false sense of security and believe without question that your business transactions are automatically transported with complete accuracy to the software. Sadly, this may not always be the case.

Small-business operators who lack professional bookkeeping support eventually find that going it alone produces results that aren't as sound as expected. Rather than wrestle with recording data and producing financial records, ensure the comprehensiveness of your statements by turning to an accounting pro.

Your story will read well ever after.
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Worth Reading
You Probably Know to Ask Yourself, "What Do I Want?"
By Mark Manson
Mark Manson has a better question. Instead of asking yourself what you want from life (and getting the typical response: happiness, health, respect, and success), ask yourself how much you're willing to suffer to achieve this. Why? "That [question] seems to be a greater determinant of how our lives turn out," Manson says. "If you want the benefits of something in life, you have to accept the costs."

How to Cultivate the Art of Serendipity
By Pagan Kennedy

The New York Times Sunday Review

Serendipity is usually considered "an occasion when someone stumbles upon a discovery or capitalizes on an accident." In other words, dumb luck. But maybe we can become serendipitous. Asks Kennedy: How do we cultivate the art of finding what we're not seeking?

Unicorns vs. Donkeys: Your Handy Guide to Distinguishing Who's Who
By Abhas Gupta

The LTV/CAC ratio is a formula that measures a start-up's revenue trajectory, its capital needs, and the amount of "irrational exuberance" required of investors. The higher the LTV/CAC ratio, the more efficient a company is at deploying capital and creating value. Gupta offers examples of fabled tech unicorns that began with impressive growth metrics but ultimately wound up as donkeys. Find out why.

This Month: Creativity in Business
In today's dynamic marketplace, business owners must possess two key traits: creativity and innovation. Creativity lays the groundwork for business opportunities, and innovation puts ideas into practice. To stimulate these traits, check out the following:

For your business to be creative, you must first be creative. How? Find out here

5 Ways to Boost Creativity in Your Business

Get inspiration from the experts. Four pros provide insight in must-see TED Talks. Watch the videos here.

TED Talks on Creativity in Business

Nurturing creativity can require drastic steps, including shutting out the world. Learn seven ways of avoiding interruptions.

7 Ways To Avoid Interruptions At Work

Many entrepreneurs think they hold the keys to creativity, but find only locked doors. Learn where the keys are hidden and take the quiz to discover if you're using them.

Learn Where The Keys Are Hidden and Take This Quiz
This newsletter and any information contained herein are intended for general informational purposes only and should not be construed as legal, financial or medical advice. The publisher takes great efforts to ensure the accuracy of information contained in this newsletter. However, we will not be responsible at any time for any errors or omissions or any damages, howsoever caused, that result from its use. Seek competent professional advice and/or legal counsel with respect to any matter discussed or published in this newsletter.
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