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Wouldn’t you love to pay lots of bill at once?

Saasu has released our Direct-to-Bank File (DTB) payment feature. Simply (a) tick all the unpaid purchases you would like to pay in your Saasu Purchase List, (b) create and save your payment and (c) click the icon/link that becomes available to create the direct to Bank File and save it to your desktop.

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Here’s a purchase we no longer need to enter in our business. We just tick it off during reconciliation each month. You can see how it’s entered and automated from the screen shot. So let’s keep this post short and simple, Saasu style!

We recently posted on this topic and the head of InterimCFO, Martyn Dominy commented on his personal experience which really deserves re-posting here in it’s own right…

I have personally been involved in running and operating four factoring facilities and thought some of my experience might be interesting for others.

Issues to consider are: (more…)

Bulk ‘Big Company’ Salary Handling For The Rest Of Us

This blog entry has been two years in preparation, we think we have solved a major issue for most businesses in a very elegant way.

Interested? You should be - we decided to make a system that normally costs tens of thousands of dollars free for all our clients, at least for now.

Paying salaries and time based reward-for-effort in any size business is a time consuming task.

We have this need here at Saasu.com for our own team and pretty much all of our clients face the same issues - it is a long wish list but if you are a business owner I am sure most of the items on it will resonate with you.

We think the most important point is doing all of the things on the list while keeping it simplified for the average business to setup and use in minutes so it pays for itself today not next year in reduced time, hassles, training costs, errors and in so many other ways including a happy team that gets paid correctly and on time.

That is the hardest thing to do, the reason we are blogging about it is we have just released Saasu Advanced Payroll.

Top 12 Payroll Tips - Making The Right Decision

These are our tips - consider them a check list when deciding on your next system -they represent what a good scalable but simplified payroll service must cover at a minimum.

1. Standard Payments Should Take No Extra Time - Setting up standard payments each week, fortnight or month, additional staff one an existing scheme or in an existing group should add no extra time to the regular pay run.
2. One Off Exception Payments Should Be Easy - Handling all those exceptions from the standard pays with minimal fuss for just the next pay but not other pays
3. Entitlement Tracking Should Be Automatic - Tracking and accumulating holiday leave entitlements and other entitlements depending on where/when/how they are working
4. Time Based Pay - Tracking time and paying employees based on time worked as well as invoicing based on time
5. Groups (Also Called Batches or Runs) - Minimising effort for similar categories of employees by grouping them together for processing by type or location or grade or something else
6. Payslips & Tax - Distributing payslips or salary confirmation sheets to individual employees who are often geographically dispersed - email is best for payslips. At end of year the production of taxation certificates (also called group certificates in many countries) is also essential
7. Banking - Getting the instructions to the bank with the right employee account details (often at other banks) - an automated bulk transaction file is best.
8. Approvals & Controls - Making sure it all happens without errors - so you need some sort of draft approval process
9. Fast - Making sure it all happens in a timely way so the money hits employee accounts when they need or expect it - must be highly automated
10. Zones - Handling the vast variety of different conditions and calculations around the world in different jurisdictions (we call them zones) - must be configurable (we are just supporting Australia for now but other countries will be rolled out progressively based on demand).
11. Integrated - No duplicate information - it must share records with existing HR or employee tracking systems and timesheets and expense handling systems.
12. Self Service - Your team must be learn the system themselves without paying for training and be able to enter their own time or see their own payslips - online via the web when ever they want

We didn’t add ‘Make sure it is software-as-a-service not old-style-on-premise-software’ because it goes without saying

The Best Bit

• Get It Now - You can have efficient payroll in your business in just minutes with Saasu Advanced Payroll
• Free - We are providing this service free to existing business subscribers and new clients who join before Christmas on our standard business plan - just tell us and we will turn it on for your business.
• Already Proven - we have already processed thousand of salaries this way (paying tens of millions of dollars) and it has been a very smooth experience.
• It Is Unique - There are a few other services like this out there but we believe there are no others at this price point and none as simple to use.

Update From Service Team - After One Week Of Free Offer…

Advanced Payroll Is A VERY Popular New Feature, we have had a rush from clients looking for access and using it in their business. Thanks. It is nice to know people like our stuff!

Just to repeat -as a reward for existing business clients (and new business clients who join before Xmas) we are offering this new module free.

The offer of free access will run until at least March 2008, thereafter advanced payroll will be part of a higher subscription plan (probably called business plus although we are still deciding plans and their names).

Pricing has not been determined but we expect the difference won’t be very large at all, it will depend amongst other things on the service/support costs we incur for an average client using the new module.

This price setting is part of a complete plan review to introduce lower plans with reduced price and functionality for entry level and higher plans for corporates - all of which is part our ongoing efforts to deliver great value software as a service to simplify your business life.

By using plans we can stage complexity (and hence simplify use for you) according to the scale of your business.

Payroll entries made via standard payroll and advanced payroll will be accessible for all payroll users (business or business plus if you will). So if you decide not to use advanced payroll later that is fine, you can still see all payroll the in the same consistent way, you just can not process them in bulk.

And of course we always ensure you are protected with the saasu.com satisfaction guarantee.

What Is Factoring?

Factoring is when you sell your accounts receivables (unpaid/outstanding sale invoices) to a finance company so you have working capital now instead of waiting.

Sometimes it is also called Discounting, Debtor Finance or Supplier Finance.

In short it’s like monetizing your “Money Owed To Me” list by selling it. The buyer/lender gets the invoices at a discount because they have risk of some people not paying them and they have labour and collection expenses to cover. Factor Co’s will buy/lend up to 85-90% of the value of your outstanding invoices. No doubt as you get bigger and if your customers are better credits you get to keep more of the invoice value.

What Is So Special About Factoring & SaaS?

There are some unique advantages to Software-as-a-Service, especially with Saasu.com in the factoring world -

1. Up To Date - Saasu.com users are in a very good position to provide live access to Factoring companies should they wish to finance or sell their receivables.
2. Reduced Risk Means More Cash - Factoring Finance Companies can get read only access directly into their client’s records with their permission or even use us to up load invoices via our API from other older style software packages allowing online reporting back to their customers.
3. Easy To Setup - Business owners looking to get quotes from Factors can provide the Factor with a temporary shadow ledger user access in minutes.

Rationale & Useful Resources

The logistics of how Factoring works is different with each Factoring Co. you deal with.

Factoring can be very handy but it does come with mixed emotions as you lose some control over customer relationships. In many cases the Factoring Co’s issue invoices to your customers which leads to risk that customers can start to receive duplicate information if the data between you and you Factor Co. isn’t matching. This is a problem for accounting software which isn’t live like an online SaaS accounting service is.

With Saasu you are both looking at the same data set or using the API to keep the Factor’s records up to date.

If you do need to use Factoring then consider that the larger reputable banks and large finance companies like GE Commercial Finance have retail reputation to maintain so they aren’t as likely to do the wrong thing with your precious customers. Many investment banks are getting into this area because these debts can be securitised in receivable Asset Backed Securities. Barclays is getting involved online which is great because it will bring ease and technical credibility to the Factoring Industry as bigger players step up and improve access.

Credit officers in the banking and finance industry may be able to provide more finance and sometimes at better rates when live financial accounting information is available. This particularly suits the Factoring industry. Out of date accounting files are a problem when it comes to establishing exactly what is owed and when to a business. Accuracy of records that the Factor has is another problem they face that you will no doubt pay for if the information you give them isn’t accurate. Giving them live access can help with this issue.

The Federation of international Trade associations has a good article on International Factoring for those in the import/export business.

Institutes for Factors and Discounters

UK - Asset Based Finance Association (ABFA)

AU - Institute for Factors and Discounters of Australia and New Zealand Inc.

INTL - International Factors Group

With around 2 million small businesses in Australasia it is no surprise that proven models are being sold as franchises. Nor is it a surprise that the franchise segment is a huge growth area for Saasu at the moment.

The key driver is flexibility and scalability- the ability to work across one or one thousand small businesses easily.

Franchise owners typically don’t want to waste time setting up financial systems that might be incompatible with the umbrella/parent franchisor network. Similarly the umbrella network managers don’t want hundreds of franchisees running their businesses on different systems so collating management information is difficult or nearly impossible.

This is where Saasu has found our sweet spot in Australia and increasingly in New Zealand and other countries.

There are no other systems on the market we are aware of that have the same level of multi-user, multi-business, single login, flexibility as we offer for franchise owners and franchisors to co-operate at different levels and get real-time business information across one or one thousand businesses.

One login can access multiple businesses and the business owner can set varying levels of access for different users. Each business can be configured differently for chart of accounts etc yet still roll up consistently formatted reports for the franchisor in PDFs or spreadsheets to email or even better with online login direct access.

Franchisees should just try it by logging in for the free version and if they like it sign up.

Franchisors should contact us or one of our partners to discuss strategies for migration, co-branding and lots more.

Franchise advisors and lenders (capital providers) can also benefit immensely from the ease with which they can monitor business performance remotely and even benchmark across businesses.

There are many methods for reducing input errors in your online accounting file. Accountants use many tricks and work processes to ensure accuracy. Learning about some of these and adopting them in your accounting routine is a good investment in time that will reward you for many years to come. Some of these methods are discussed below, however there are many more:

Basic review of your transaction listings

As you create transactions they will appear in your transaction list for the date period applicable. The process is usually to “add” a new transaction to the list, “save and close” the transaction and then check the transaction for correctness. You cannot check all the detail for transaction but the main items such as Date, Amount and Contact can be verified. This is the most basic and quickest, but least thorough, of checks you can do.

Review of your Categorised Summary report

This is a good report for checking you have used correct tax codes and ensuring you have chosen the correct transaction category for you transactions. You might scan the report to ensure that (for example) all your sales appearing in a transaction category for “Income: light fittings” would have the same tax code. You might also check that there aren’t any stray transactions in this category that shouldn’t be there.

Use the duplicate function for adding transactions

When you use the Duplicate button on any Add/Edit Transaction screen you are creating an exact copy of the transaction you are viewing with a few fields cleared like the Date for example. This helps produce consistency in your transaction adding over time as you will be using the same transaction categories, tax codes, summary information and so on as you are duplicating the information not entering it.

Use the Categorised Summary report to help in adding transactions

A good example of this is when you have regular periodical payments you make for things such as subscriptions, rent, bank fees that are often the same each month except for the transaction date.

1. Load the Categorised Summary report for the previous month (or period) and click on the transaction you want to duplicate in the new month.
2. When the transactions loads you can then click on the duplicate button and the new transaction will load.
3. Then you can include the date for this new transaction and amend any other differences (eg. Summary..”Jul02 rent” to “Aug02 Rent”) and then save the transaction.
4. You will then be viewing the Categorised Summary report again where you can then repeat the process until all your regular payments have been entered.

Use the Transaction Lists to help in adding transactions

As in the above example you can create a list of transaction for the previous month (or period). Use the same process to create new transactions for the new month (or period).

Additional

Make sure you have paperwork, invoices, and bank statements to back up you data entry. Just assuming these things will happen each month (or period) doesn’t mean they actually do!

Internet banking template technologies for processing payroll

Internet banking can speed up you payroll processing and vendor payments. See Internet Banking Templates For Payment Processing

Fixed bank fee arrangement (annual)

Many banks will offer an annual bank fee as one payment instead of the usual monthly fees plus all those intra-month fees for ATM and Internet Banking usage. Paying one annual fee will shorten your bank statements, reduce your data entry work and make reconciliation’s easier.

Pay multiple bills from one vendor all at once

This is possible with vendors who have longer payment terms. If you can get vendors to stretch their terms to 3 months from the usual 7 to 30 days then at least you reduce the payment processing work when you write one cheque, or process one payment, for a set of invoices.

Dealing with vendors who insist on onerous paperwork

If you receive an excessive number of documents from a vendor, which may include; statements, invoices, reminders and other forms of vendor communication. Consider this time cost they are imposing on your business. One major courier company I know springs to mind. They insist on billing weekly.

Underestimating the cost of processing a transaction

If processing payment early saves you time, and that time value in dollars outweighs the funding cost of spending your cash early then it may pay to clear the payment paperwork earlier.

Buying multiple services/products from one vendor

If you can obtain a discount for buying more products from one source, receive less paperwork, reduce your payment processing work and obtain more lenient terms then this may work for you. Again there are many flow-on advantages like shorter bank statements and less reconciliation’s work results in time cost savings. A classic example is with stationary suppliers. Many businesses deal with 3 or more stationary companies. If this saves you lots of money then excellent! If not why put up with the extra paperwork?

Generally employee expenses are time expensive

Setting up a Motor Vehicle fuel account may be easier than managing those payments as reimbursements through salary or organising lots of paper receipts every month. There’s a huge list that can go here but you get the idea.

Many small business use the Just-In-Time approach to payment processing and invoice issuing. This means writing cheques, using a credit card or paying online when vendors start demanding payment or when a bill reminder comes in. This can work when your cashflow is tight. A method that may appeal to some small businesses or investors (but not all) is a Payment Centric method. In a nutshell you choose a frequency that you plan to make payments (or issue invoices), you then write your cheques or process your Bpays, and book the transactions in your accounting system, all on one day. Let’s call this the ‘accounts day’. Then you don’t touch the accounts until the next assigned ‘accounts day’.

With any business system or procedure it’s a case of what works best for your specific needs. Who are the experts at processing and doing accounts efficiently? Accountants must be on this list. They are not just there for tax advice.

We have a listed a few pro’s and con’s that you might like to consider.

Why does this work?

• Get all your cheques prepared and then signed in one session by the cheque writer or cheque signatory.
• Allows you to use Internet banking templates to process multiple payments on that day.
• It may help to manage you cashflow in a more predictable way. e.g. If you know that the 5th of each month is payment processing day and you have $X dollars to make your payments then cashflow becomes more predictable.
• Doing a task 20 times in one sitting is nearly always more efficient than doing 1 task over 20 sittings.
• When you do everything on one day, filing is a lot easier.
• Your vendors and customers will find your organisation more predictable and professional.
• Your work colleagues and employees will know that its the ‘accounts’ day. You can deal with it on that day rather than interrupting work.
• If you have a bookkeeper or a bookkeeping company to do this work, it will nearly always be cheaper to have them in for one full day, rather than have them in spasmodically over time.
• Your Profit and Loss and Cash Flow reports (and others), may end up cleaner and clearer.

When doesn’t it work?

• When the gaps between ‘accounting days’ are set too far apart your management information may get out of date, your vendors may get impatient and you might hate the idea of spending a whole day just doing ‘accounts’. Select a frequency that suits your business model from a holistic perspective.
• When your customer insists on invoices immediately or very regularly. Note that there are legislated requirements for invoices to be issued within a certain time after services have been provided.
• When vendors insist on getting cash on delivery
• When you forget to pay a vendor then they have to wait until your next ‘accounts day’. This can really upset vendors. Then they might charge you more. Ouch!