Why Is Accounting So Important?

Starting a business often requires entrepreneurs to understand and complete a variety of business functions. An important business function when starting a small business is accounting. Although many entrepreneurs may be fearful of dredging through endless stacks of financial documents, accounting often provides entrepreneurs with the clearest picture of their business' success. Entrepreneurs must also keep copious amounts of records regarding the small business startup for tax and legal purposes.

Asking that question of an accountant is like asking a farmer why we need rain.  We need accounting because it’s the only way for business to grow and flourish.  Accounting is the backbone of the business financial world.   After all, accounting was created in response to the development of trade and commerce during the medieval times.
 

Italy is our first recorded source for accounting entries, and the first published accounting work in 1494 was by a Venetian monk.  So you see accounting as an organized method for record-keeping has been around almost as long as the trade and business industries.  Another interesting fact is the knowledge and principles upon which the first accounting practices were established, have changed very little in the many hundreds of years that accounting has been in use.  The concepts of assets, liabilities, and income and the need to reconcile these areas is still the basis for all accounting functions today.

Benefits & Problems With Franchising

The decision to sell franchises of a business is one that should not be taken lightly. Although there are many benefits to franchising, there are also many problems that can develop. Before deciding to take on franchisees, it is vital to understand the benefits and potential problems associated with franchising a business.

Benefit: Expansion and Growth

• Perhaps the main benefit of franchising a business is the growth potential. The business can grow quickly with lower capital requirements. The franchisees are typically responsible for rent, construction costs and other expenses necessary to open a business. The company benefits from new stores without the associated costs.

Licensing Vs. Franchising

There are two type of business you can choose either franchising or licensing but both of it mostly are similar in term of royalty and fees.  Choosing between franchising and licensing depends on the type of business, available start-up capital and the amount of creative control desired by a business owner. Also, how close a relationship an owner wants with a parent company should be considered.

Franchise Systems Definition

Franchise, some people know but not well-know and some have heard about it but not much know about it. So, we will talk about this business system. Franchise systems are the protocols and processes that a franchiser makes available to franchisees as part of their franchising agreement. According to Scott Shane of the Sloan School of Management in Massachussetts, franchise systems are most successful when they make economical use of an organization's resources. In other words, franchising systems should enable a franchisee to operate his company cost effectively.

Company Secretary in Malaysia

Secretary, what you know about secretary??? It is a women with skirt and sexy???What i want to tell you now is a company secretary. Every company is required by statute to have at least one company secretary or more in Malaysia. Who can be company secretary??? The person which are a members of professional bodies such as:
1. The Malaysian Association of the Institute of Chartered Secretaries and Administrators (MAICSA)
2. The Malaysian Institute of Accountants (MIA)
3. The Malaysian Institute of Certified Public Accountants (MICPA)
4. The Malaysian Bar
5. The Sabah Law Association
6. The Advocates' Association of Sarawak
7. The Malaysian Association of Company Secretaries (MACS)
and also the person licensed by Commissioner of Company Malaysia (CCM) under Section 139 Companies Act 1965.

The secretary is to be appointed by the board of directors and either himself or his agent or clerk is required to be present at the registered office of the company on the days and at the hours which the registered office is to be accessible to the public.In most cases it is not practical for most small medium enterprises to engage full time secretaries. Instead, the service of an external secretary of a professional secretarial firm is engaged.

What are the general duties and responsibilities of company secretaries?
The duties and responsibilities of company secretaries depend mainly on the expectations of the board of directors. In most cases, the company secretary is responsible to ensure compliance with the disclosure and information requirements of the Companies Act.

These are some of the main duties of a company secretary:

1. Organise meetings

2. Send out notices for meetings

3. Take down minutes of board and general meetings

4. File statutory returns (in the prescribed forms) required by the Companies Act 1965 with the Companies Commision of Malaysia

5. Keep and maintain the various registers at the registered office of the company.

Duties of Directors

A company is a separate legal entity, separate and distinct from its individual members/shareholders.  For small company normally members of the company become the Director. Members of the company will appoint directors (members or outsider) who will be entrusted with the power and authority to make decisions for the running of the company and manage the company's affairs.

For many small businesses, members of the company who have come up with their own capital to fund their businesses are often involved in the day-to-day management of the company. These members usually appoint themselves to be the directors of the company.

For larger businesses such as public listed companies, it is practically impossible for the shareholders to manage the company's affairs and therefore directors are empowered to operate the company.

What are the requirements of directors of a company?

There must be at least 2 directors who each have his/her principal or only place of residence within Malaysia, whether he/she are Malaysian or not.

To qualify to become a director of a company, he must be:

1. A natural person
2. Of full age (18 years old and above)
3. Of sound mind
4. Not disqualified under the Companies Act 1965

Directors are not required by law to have special knowledge, or experience to act in that capacity.

Start Up Business in Malaysia

Do you need to set up a company to start up business in Malaysia?

Businesses in Malaysia are required to be carried out by either these two types of business organisations:

1. Business firms (governed under Registrar of Business Act 1956)

2. Registered companies (governed under Companies Act 1965)

Start up Business in Malaysia - What is a business firm?

Business firms can be either of these two types:

1. Sole proprietor/ Sole trader - Sole proprietor is a business carried out in the name of an individual.

2. Partnerships (governed by Partnership Act 1961) - Partnership is a business owned by two or more individuals.

Both these types of business firms have no separate legal existence apart from the persons who owns the business and properties cannot be held under the name of the business firms. All contracts are signed in the name of the individuals who own the business and their liability is unlimited.