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ALL IN THE FAMILY

Accounting for entrepreneurs

/ 05:20 AM February 18, 2021

A reader, Kerwin Tiu, says: I run a small family business in Quezon City. Can you recommend an online program teaching financial bookkeeping and accounting to entrepreneurs?

My reply: One way for family business owners to take advantage of downtime in the pandemic is to hone necessary skills, such as bookkeeping and accounting.

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Though often regarded as synonymous, the two are not exactly the same.

As high school juniors in the early 1980s, my classmates and I studied bookkeeping, where we recorded financial transactions such as debit and credit, balanced ledgers, worked on payrolls and familiarized ourselves with the basics of record keeping.

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In small and medium-sized family businesses, family members often perform the bookkeeping role. Bookkeepers are not required to get government certification.

In high school in the late 1990s, my son and his classmates learned business management, including accounting basics. No longer confined to just bookkeeping, they studied financial statements, such as income statements and balance sheets, managed operational costs and did case studies on the impact of financial transactions on companies, big and small.

Several of my son’s friends went on to major in accounting in college, and are currently reviewing for their CPA (licensure) exams. Family businesses need good accountants who can help them make sense of cash flow, including financial forecasting and tax planning.

If you are interested in just bookkeeping, check out Entrepreneurs Accounting Academy’s Tesda-certified “Bookkeeping Made Easy.” (eaa.edu.ph)If you have the time and are willing to expend the effort, I suggest learning accounting rather than just simple bookkeeping.

For those who just need to brush up on certain topics, check out Harvard Business School’s online blog “Accounting for Entrepreneurs: 5 Skills You Need to Know.” (online.hbs.edu/blog/post/accounting-skills-for-entrepreneurs)

For entrepreneurs who are intimidated by math and just want to skim the fundamentals, check out “Guide to Accounting for Entrepreneurs Who Hate Numbers” by US small business owner and marketer Caron Beesley. (fundbox.com/blog/new-guide-accounting-entrepreneurs/)

Nothing beats a solid course offered by top universities, many of which are free (or almost free) of charge. The University of the Philippines Open University runs “Simplified Accounting for Entrepreneurs” (SAfE) on certain dates. (fmds.upou.edu.ph/academics/cep/entrep-cluster/safe/)

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“While the focus is [on] service businesses (as this is the simplest), the concepts and the procedures are almost the same for … the merchandising and manufacturing/processing businesses,” says SAfE. “The course hopes to assist entrepreneurs who do not have accounting background in understanding … accounting … and how it can be used to … [make] financial [daily] decisions.”

The Massachusetts Institute of Technology Sloan School of Management uses several case analyses in “Management Accounting and Control” for small to big businesses. (ocw.mit.edu/courses/sloan-school-of-management/15-521-management-accounting-and-control-spring-2003/index.htm)The University of Pennsylvania’s Wharton School offers “Introduction to Financial Accounting” on Coursera, which can be accessed for free as part of a seven-day trial.

Since you are running your own business, check out Stanford University’s “How to Start a Startup,” including a video on “Legal and Accounting Basics.”

At the heart of Silicon Valley, Stanford is best placed to give suggestions on becoming a great founder, building products that people love, hiring employees that fit the culture. This course is free on iTunes. (itunes.apple.com/us/course/how-to-start-a-startup/id951932247)Happy learning!

Queena N. Lee-Chua is with the board of directors of Ateneo’s Family Business Center. Get her book “All in the Family Business” on Lazada and the ebook version on Amazon, Google Books, Apple Books. Contact the author at [email protected]

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