◦Yo u r suc c e ss in b u sin e ss will re st o n g o o d re c o rd

ke e p in g p ra c tic e s a n d so lid c a sh flo w. With o ut

g o o d re c o rd s it is sim p ly im p o ssib le to d e te rm in e
the fin a nc ia l c o nd itio n o r p ro fita b ility o f yo ur

KEEPING GOOD
b usine ss. As a sm a ll b u sin e ss o wn e r yo u sh o uld b e
fa m ilia r with a n d re c o g n ize th e im p o rta n c e o f
FINANCIAL RECORDS p ro p e r re c o rd ke e p in g re q uire m e n ts a n d c a sh
flo w p la nn ing .

◦Whe n se ttin g u p a c o m p a n y, re g a rd le ss o f
th e size , th e re a re re q u ire m e n ts u n d e r th e
G o ve rn m e n t Re g u la to ry Ac t re g a rd in g th e
m a in te n a n c e o f b o o ks a n d re c o rd s. It is
im p o rta nt th a t yo u a re a w a re o f th e le g a l KEEPING RECORDS
re q u ire m e n ts a n d e n su re th a t yo u a re
a b le to p ro d u c e the re q u ire d in fo rm a tio n .

Ac c u ra te fin a nc ia l re c o rd ke e p in g w ill b e
c ru c ia l to yo u r b u sin e ss fo r th e fo llo w in g The specific records your business will
re a so n s: need depends on a number of factors,
◦ To p ro vid e fina nc ia l d a ta tha t h e lp yo u o p e ra te m o re e ffic ie n tly,
th us inc re a sing yo ur p ro fita b ility. such as:
◦ To id e ntify a ll yo ur b u sin e ss a sse ts, lia b ilitie s, in c o m e a n d e xp e nse s.
Th is info rm a tio n c a n the n b e use d to c o m p a re with yo ur se c to r’s
a ve ra g e s a nd h ig hlig ht yo ur stre ng ths a nd we a kne sse s. 1. the type of enterprise,
◦ G o o d re c o rd s a re e sse n tia l fo r the p re p a ra tio n o f yo ur e nd o f ye a r
re turns a nd fin a nc ia l sta te m e n ts. The se sta te m e nts a re c ritic a l fo r 2. the company goals and
m a inta ining g o o d re la tio ns w ith yo ur b a n k.
3. your management needs.

Yo u r re c o rd ke e p in g syste m , w h e th e r
o n p a p e r o r o n a c o m p u te r, sh o u ld b e :
1. sim p le to use

BASIC REC O RD 2.
3.
e a sy to un d e rsta n d
re lia b le
KEEPING SYSTEMS 4. Ac c ura te
5. c o n siste n t a n d
6. d e sig n e d to p ro vid e in fo rm a tio n o n a tim e ly b a sis.

Th e fo llo w in g a re a list o f b a sic 3. Sa le s Bo o k - Th is is a list o f a ll sa le s in vo ic e s.

re q u ire m e n ts fo r a n y a c c o u n tin g syste m :
1. C h e c k Jo u rn a l - Th is is a list o f a ll p a ym e n ts m a d e fro m yo u r
b a n k a c c o u n t. Th is w ill b e re q u ire d fo r e a c h b a n k a c c o u n t.
2. C a sh Re c e ip ts Bo o k - Th is is a list o f a ll c a sh re c e ive d a n d a n
e xp la n a tio n o f w h e re th e fu n d s h a ve c o m e fro m , fo r
e xa m p le d e b to rs, lo a n , e tc . Ag a in , th is is re q u ire d fo r e a c h
b a n k a c c o u n t.
Th e Sa le s Bo o k sh o u ld sp lit th e sa le s b e tw e e n
th e VAT e le m e n t a n d th e d iffe re n t typ e s o f
p ro d u c t th a t yo u se ll.
4. Pu rc h a se s Bo o k - Th is is a list fo r a ll p u rc h a se s
in vo ic e s. Th e se a g a in n e e d to b e a n a lyze d in to
th e c o st o f sa le s e xp e n se s a n d a d m in istra tio n
e xp e n se s. In a d d itio n th e VAT e le m e n t m u st b e
sh o w n se p a ra te ly
 5. De b to rs Re c o rd s
Th e se b o o ks w ill sh o w a t a n y tim e
w h a t yo u a re o w e d fro m yo u r c u sto m e rs.
6. C re d ito rs Re c o rd s
Th e se b o o ks w ill sh o w w h a t m o n e y is
o w e d to yo u r su p p lie rs a t a n y g ive n tim e .
7. Sa le s In vo ic e s
◦A c o p y o f a ll sa le s in vo ic e s m u st b e
m a in ta in e d .
8. Pu rc h a se In vo ic e s
◦A c o p y o f a ll p u rc h a se in vo ic e s liste d in
yo u r d a ily b o o ks m u st b e re ta in e d .
◦Bo th a p p ro a c h e s h a ve th e ir p ro s a n d c o n s.
C o m p u te r o r Ma n u a l Syste m s
◦Th e d iffe re n c e b e twe e n ke e p in g m a nu a l re c o rd s
a n d u sing a c c o u n tin g so ftwa re is in fo rm a tio n
m a n a g e m e n t. Da ta sh o u ld b e e n te re d in to th e
a c c o u n ts p a c ka g e o n ly o n c e ; it sh o u ld th e n
e m e rg e in the fo rm o f Pro fit a nd Lo ss Ac c o u n ts,
Ba la nc e Sh e e ts a n d VAT Re tu rn s e tc .
Th e m a in a d va n ta g e s o f
c o m p u te rize d a c c o u n tin g
◦in c lu d e h ig h sp e e d a nd fle xib ility o f re p o rtin g ,
re lia b ility, n o ro utine wo rk, in c re a se d a c c u ra c y,
in te rn a l c o n tro l syste m o f in c re a se d p ro d uc tivity
a n d e a sy b a c k-u p a n d re sto ra tio n o f re c o rd s.
C a sh Flo w
◦To b e c o m p e titive yo u w ill h a ve to p re p a re
fo r a ll fu tu re e ve n ts a n d m a rke t c h a n g e s.
Th is p re p a ra tio n is c a rrie d o u t th ro u g h c a sh
flo w p la n n in g . Fa ilu re to p ro p e rly p la n c a sh
flo w is o n e o f th e le a d in g c a u se s fo r sm a ll
b u sin e ss fa ilu re s.
6. Pa yro ll
◦Re c o rd s m u st a lso b e ke p t re g a rd in g th e
sa la rie s yo u a re p a yin g to yo u r sta ff.
In fo rm a tio n m u st b e m a in ta in e d o n h o w
th e ta x is c a lc u la te d a n d a n y a d d itio n a l
re fu n d s o f e xp e n se s. Se p a ra te e xp e n se s
c la im fo rm s m u st a lso b e re ta in e d fo r th e se
p a ym e n ts.
9. Sto c k Re c o rd
◦ Th e typ e o f re c o rd s re ta in e d he re d e p e n d s o n yo u r b u sin e ss.
Th is m a y b e a n a re a th a t sho uld b e d isc usse d with yo u r
a c c o u nta n t.
10. Ba n k Sta te m e nts
◦ All b a n k sta te m e nts fro m a ll yo u r a c c o un ts sho u ld b e
m a in ta in e d .
◦ All o f th e a b o ve re c o rd s m u st b e ke p t fo r se ve n ye a rs un d e r
C o m p a n y la w a n d b e a va ila b le fo r insp e c tio n b y th e
re ve n ue c o m m issio n e rs.
Th e a d va n ta g e s o f m a n u a l a c c o u n tin g :
 th e in d e p e n d e n c e fro m m a c h in e s.
Th e d isa d va n ta g e s in c lu d e :
re d u c e d sp e e d
in c re a se d e ffo rt o f a c c o u n ta n ts,
re la tive ly slo we r in te rn a l c o n tro l re p o rtin g
th e re p e titive n a tu re o f th e wo rk.
Th e d isa d va n ta g e s c o m p u te rize d
a c c o u n tin g
1. re la tive ly h ig h c o sts o f in tro d u c ing
a n d u sing th e syste m ,
2. sp e c ia l tra in ing fo r p e rso nn e l,
in c re a se d p e rso n ne l c o sts a nd a
d e p e nd e nc e o n m a c h in e s
◦C a sh flo w a n a lysis sh o u ld sh o w w h e th e r
yo u r d a ily o p e ra tio n g e n e ra te s e n o u g h
c a sh to m e e t yo u r o b lig a tio n s a n d h o w
yo u r m a jo r o u tflo w s o f c a sh to p a y yo u r
o b lig a tio n s re la te to m a jo r in flo w s o f c a sh
fro m sa le s.

CONTENTS OF THE BUSINESS PLAN
A. The Business Concept and the Business Model
4 AREAS OF MONEYMAKING WHICH THE BUSINESS MODEL MUST ADDRESS:
1.How will the business raise revenues?
What critical factors will cause the
revenues to materialize?
4 AREAS OF MONEYMAKING WHICH THE BUSINESS MODEL MUST ADDRESS:
3. What will be the major
investments of the enterprise? Why
will these investments give the
enterprise a competitive edge?
B. The Business Goals: Vision, Mission,
Objectives, and Performance Targets
• VISION – something that you see or dream
• MISSION – a task or job that someone is
given to do
• OBJECTIVES – a goal or purpose
• PERFORMANCE TARGET – something that you
are trying to do or achieve
The Executive Summary should then introduce
and highlight the good qualities of:
1. the business proponents and their partners;
2. the enterprise organization and its
capabilities;
3. the technology providers and their expertise
and experience; and
4. the suppliers and all the major service
providers.
I. INTRODUCTION
A.The Business Concept and the Business
Model
B.The Business Goals: Vision, Mission,
Objectives, and Performance Targets
C.The Business Offering and Justification
4 AREAS OF MONEYMAKING WHICH THE BUSINESS MODEL MUST ADDRESS:
2. What will be the costs of the enterprise
products and other costs of doing business?
How will these costs be managed to ensure
comfortable profits? What critical factors
will drive the costs? How can these factors
be controlled?
4 AREAS OF MONEYMAKING WHICH THE BUSINESS MODEL MUST ADDRESS:
4. How will the enterprise finance
the investments? How will the
enterprise fund its growth?
II. THE EXECUTIVE SUMMARY
• it contains everything that is relevant and important
to the business audience.
• a synthesis of the entire plan
• it must contain the major argumentations of the
business proponents on why the business will work
and succed
• it should provide the business plan audience all the
arguments on why they should participate in the
business venture
• ENTERPRISE STRATEGY – builds and
develops the game plan for attaining
competitiveness
• ENTERPRISE DELIVERY SYSTEM – is the
entire process of converting input
(resources)into output and these output
into outcomes
Investment requirements should be presented Executive Summary should..

• Summaries of the projected income statements

• Balance sheets
•contains section on the environmental
• Cash flows and regulatory compliance of the
• Fund flows proposed business
• Analyses
• Conclusions •As well as the more proactive programs
to become a more responsible
Yields and returns, along with risks and contingency measure should round up this
section corporate citizen

ES should… III. THE BUSINESS PROPONENTS

• present the capital structure of the proposed
business and show how this structure will respond
to the investment programs and financial forecasts
of the enterprise.
• only be written last in order to capture the
findings and insights of the other parts, but for
presentation purposes, it is placed in the first
part of the business plan
• The third section of the business plan contains
information about the business proponents or
stakeholders. There are four types of stakeholders:
1.Resource mobilizers and financial backers
2.Technology providers and applicators
3.Governance and top management
4.Operating and support team.

IV. THE TARGET CUSTOMERS AND THE MAIN

VALUE PROPOSITION TO THE CUSTOMER
• The business proponent must be very precise • Knowing where the target customers are exactly concentrated, the
business plan should then pinpoint
about the target audience.
1. What the customers buy
• Target customer must be of sufficient size, 2. How they buy
sufficient paying capacity, and have sufficient 3. When they buy
interest to purchase the products being offered by 4. Where they buy
the enterprise
5. What convinces them to buy
• It is the unique selling proposition of the These information should then be used to justify the exact locations
enterprise and marketing channels to be employed by the enterprise

MONEY MANPOWER
Big organizations maintain As many organizations have
THE 4 M's OF significant funds which they
can easily tap when
pointed out, their employees
are their most valuable
OPERATIONS business.opportunities arise. resource.

MACHINE MATERIALS MANAGEMENT

State-of-the-art machines and a steady and sufficient supply A reputable management
equipment facilitate the of quality raw materials promotes good governance
processing of raw matetials ensures the.continous within the organization,
into finished ptoducts. production of goods and adheres to ethical standards,
eventually, their sale to end and practices social
users responsibility.
 MARKETS METHODS MINUTES
The marketing plan must The use of superior technology Stevenson (2012) states that many
firms focus on reducing the minutes
include the number og or methods in processing or or time needed to conduct various
competitors, both local and producing goods can give an activities such as developing new
foreign; the prices and quality enterprise a competitive products or services, responding to
a change in customer's demands or
of goods; anf potential end edge. delivering a product or performing
users a service

Preparing a business model is The business model must contain at

important for the following reasons: leasts the following:
The business model serves as an Forecasts of business revenues
extension of the feasibility study.
DEVELOPING A It combines all the factors in the business
plan to produce a complete picture of
Calculation of costs
Estimation of profits
BUSINESS MODEL the proposed enterprise
It conveys the vision, mission, and
Projection of its five-year
objective of the enterprise to internal financial statements
and external parties

Below are examples of some

Forecasting taxpayers and their source of income
means estimating or predicting TAXPAYER INCOME SOURCE
future business performance. A Furniture maker
Bakery owner
Sale of furniture
Sale of breads, cakes
FORECASTING revenue forecast includes the Convenience store owner
Physician, lawyer,
Sale of grocery items
income source such as sales, Professional Fee
BUSINESS REVENUES services, interest on bank
Depositor
Stockholder
Int on savings dep
Cash Dividends
Salesperson
deposits, dividends, and Apartment owner
Salaries, Commission
Rental Income
commissions.

In the manufacturing business the

PROJECTED Revenue from Sales ●FORECASTING COSTS cost of goods sold is computed as
follows:
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEARB5
Costs refer to expenditures incurred in
generating revenues.
1. Add the cost of raw
Forecasting Costs incurred in materials, direct labor (salaries
440,400.00 566,925.00 658,418. 00 763,307.00 932,080
manufacturing and trading business and wages), and indirect
have two components: materials (items needed in the
1. Cost of goods sold manufacture of goods, such as
2. Selling and Administrative expenses
nails and paint) to arrive at the
cost of goods manufactured.

2. Deduct ending inventories of ADMINISTRATIVE

raw materials, work-in-process, SELLING EXPENSES
EXPENSES
and finished goods from the
cost of goods manufactured to include the salaries, usually consist of taxes;
arrive at the cost of goods commissions, and licenses and fees; electricity,
manufcatured and sold. Note entertainment expenses of water, and telephone
that ending inventories for the salespeople and expenses, salaries/wages of
current year becomes the representatives Accountants,clerks, janitors,
beginning inventories for the and transportation expenses
incoming year.