Finances & Fear – The Two Don’t Have To Go Hand-In-Hand

People generally fear anything to do with finances (unless, of
course, they have won the lottery). In fact, this may be the number one
thing that people AVOID. We can be very good at justifying why we
really don’t need to concern ourselves with our financial state of being
“right now”. These justifications include: “Something is going to
happen really soon that will turn things around”, “My debt isn’t that
bad”, “I’m still so young; I’ll start saving soon”, “I’ll deal with the
bills later.”

So what are the real reasons we don’t want to deal
with our finances? There are four primary reasons for this avoidance
and they tend to stem from what we have learned – or not learned – about
finances and life as we were growing up. Each of these reasons are
presented below, with a solution for how to make the necessary changes
for your benefit.

We are uncomfortable talking about money:

Most
of us simply aren’t raised to be truly comfortable with the topic of
money. It is rarely freely spoken about. Many of us were taught us
that it was rude or otherwise inappropriate to discuss money. Perhaps
you grew up in a home in which your parents did not know how to manage
finances. Of course, it was never appropriate to share what you were
earning or how much things cost and if you had debt you certainly never
told anyone. We are also never taught about money in school. A
remarkably small number of students ever took classes on personal
finance, debt management, investing, building residual income, setting
financial goals, or any other topics that are so obviously critical in
real, day-to-day life.

Solution:

Start talking honestly about money with people you trust. At Abundance Bound ( Financial Education and Planning for Actors and Artists)
we encourage our clients to work with a friend who also wants to make
financial changes, and commit to helping and supporting each other
without any judgment. Start sharing what things cost – how else can we
find the best deals and bargains? Be truthful about your financial
struggles and even your debt. This will bring it out in the open so you
can no longer pretend it doesn’t exist. Make a commitment to learning
about money. Read books, take classes, get help creating a personal
financial plan that will work for you regardless of how desperate your
financial situation may seem.

It is unfamiliar, so we feel like failures:

It
naturally follows that, if we were not taught about financial
management as we grew up and may have even gotten the message that it
was a taboo subject, it is going to feel very unfamiliar. And as
everything that is new, it is going to be difficult at first. As trite
as it may seem to remind you that you didn’t just jump on a bike and
start riding, the same is going to be true when you start learning to
handle your finances. There are going to be things you don’t
understand. When you first start getting yourself financially
organized, setting up filing systems and ways of tracking your income
and expenses, it may take days, even weeks to get it all in place. “I’m
not any good at this,” is a common decision we make, and quitting is
not far behind.

Solution:

Recognize that money management is a game. This isn’t
to imply that money management is not serious. Money impacts your life
in meaningful ways. After all, we all need a roof over our heads, food
to eat, and clothes to wear. But allow yourself the time to learn to
play. Reward yourself for the small wins – the freshly organized filing
cabinet, the new deposits you start making each month into an account
for investments, the debt plan you have put in place… Almost before
you know it, strong financial habits will become your new way of life
and you won’t be able to go back. You wouldn’t be able to stand it!

Fear – it’s out of our control:

Particularly
as artists, we are afraid of really looking at our financial situation
because we don’t think there is anything we can actually do about it.
We frequently live our lives waiting for someone else to give us a
break, an opportunity, rather than believing that very much lies within
our control.

Solution:

Recognize that this is just a
story we’ve been telling ourselves and it simply isn’t true! Artists
are some of the hardest working, most intelligent people in the world.
We have to own that power and stop existing from a place of neediness.
Find mentors. Surround yourself with people who are playing big games
and join in – follow their lead. As long as we are willing to learn, to
take some chances and think outside of the box, we can all find ways to
significantly improve our finances.

Time Management – we feel overwhelmed by the amount of work there is to do:

Time
management is also something many of us were never taught as we were
growing up. We tend to think of managing our finances like it is one
enormous job. “I don’t have time to deal with my finances.” We look at
all of the work involved in getting and keeping our finances in order
and we either say we’ll schedule the time in and never do or we just
decide that we can’t fit it into our lives. After all, we don’t want to
be distracted from our creative careers.

Solution:

Stop
focusing so much on the big picture and start breaking down your
financial goals into small, manageable pieces. You don’t have to get
organized in one fell swoop. Sit down and make a list of what it is
going to take – then attack the list in 15-30 minute segments of time.
If you find yourself with a free afternoon to do financial work, great,
but it isn’t necessary. Pick a financial topic that interests you or
some aspect of your finances that you feel is a priority, take a book
out from the library, and read a chapter a day – even half a chapter!
Yes, you are going to have to decide that this is important enough to
add into your life, but it doesn’t have to take over your whole life.
Far from it! The truth is that handling your finances will actually
create more time and more energy in your life – you just have to begin.

It
is often said that awareness of a situation is half the battle. After
awareness follows acceptance, for only after we truly accept it within
ourselves will we do anything about it. Ask yourself this – Am I
willing to do whatever it takes to change my life? After all, you are
the only one who can change it, for the better – or the worse. Choose
the better.

Reason for Increased Demand for Financial Liability Insurance in India

There has been a big jump in financial liability insurance in
India. The industry is growing about 10-20% every year and is not
expected to slow down. Here are some of the reasons why.

What FLI offers?

There are
different types of FLI. Most are made to guard companies and individuals
against lawsuits and other claims. The three main types are general,
professional, and product. These cover things like credit issues,
problems facing company leaders, and factors about the public. It
reduces the fines that companies and individuals have to pay when they
are named in a suit. Law and third-party suits are rising by 30-40%
every year. This is due to changes to the legal and professional layout
of the financial services industry.

A changing business world


India is seeing a lot change in its business segment. The country is
facing more financial demand. Companies are more tied to foreign
branches. Investors and employees are more active in speaking out about
problems and what they need. These factors mean company officers,
directors, and shareholders are under more stress. They have more people
watching what they do. New laws and truths also mean more room for
making mistakes. Director’s and officer’s insurance is the fastest
growing kind. This covers them for error, workplace misconduct, and
legal fees in case of a lawsuit.

The Satyam Scandal


In 2009, the chairman for the Satyam Computer Services Company admitted
to fraud. He stepped down from his role and faced his crime. This
caused problems for the other top employees at the company. They faced
an uproar as many were sued and suffered big losses. The governing body
PriceWaterhouse Cooper was found to be too relaxed in following
standards. It had to pay big fines to the US Securities and Exchange.
The scandal drew a lot of media interest, which caused public outcry.
This issue had a big effect on the financial services industry. It
sparked legal change that affected the need for insurance.

The Companies Act


In 2012, the government changed the Companies Act. New laws make
business more see-through. They increase the duty to have company
supervision. It also explains the role of independent directors. This is
in the wake of the Satyam Scandal. The act allows mergers with foreign
companies. This puts more focus on international values. It also creates
financial demand in the country. The new act allows class action suits
to be filed against top company members. Other members or clients can
make a claim for errors and fraud. These changes make more charge within
companies, and therefore increase the demand for insurance.

Conclusion


The factors around India’s financial services industry in recent years
have made a need for insurance. It is vital to the ongoing growth of the
sector. Global mixing with big firms means tough regulators. It pushes
India’s top company heads to expand their skills and knowledge. Stricter
management is required. Media scrutiny is much more important. This can
greatly add weight to finger pointing. It creates more personal risk
for solo board members. Coverage is only likely to grow in years to
come. There is both the want and need for more armor.

Know & Avoid the Ten Financial Mistakes People Commonly Make

At times the turbulent waters of finances can be difficult to navigate. Doing it alone, with no help or guide, can be even more challenging. So here are ten of the most common financial mistakes people make and why you need to be mindful of them in your life.

Not Making or Keeping to a Budget

Having and sticking to a budget can do wonders for your financial stability. Some have compared a budget to a road map. Instead of wondering where your money goes each and every month and scratching your head about why you are 200 dollars short for the month, you can know what you need to spend and where it will go. Far too many people do not have a budget or cannot stick to the one they have.

Credit Card Payments

If you pay your credit cards on time and can pay them off each month that is great. If you cannot pay them off fully, you need to try and at least pay more than the minimal payments each month. Many people get into financial trouble because they do not pay their credit bills on time or miss payments all together, which can wreak havoc on your credit score and ruin your financial future.

Not Seeking Help

Money may be a topic most avoid, but there does come a time when you need to talk. When you are drowning in your debt and cannot keep treading water, it is time to call out for help. Unfortunately, many people do not look for help with debt consolidation and negotiating better loan terms until it is too late.

Not Knowing Your Credit Report

Having a bad credit score can also sink you financially. Many people do not check their credit reports to see what is there and are surprised at what is found when a bank or lender checks the report. Being informed about your financial standing will go a long way in helping you out.

Not Planning for Emergencies

No one likes to think about it and at times it can be next to impossible to save anything, but whenever you can you need to squirrel money away for emergencies. The car breaks down, someone needs to go the ER, or something else big happens, and you need to be as prepared as possible so it does not put you that much further behind financially.

Buying Out of Your Means

One of the top reasons people get into debt trouble is that they buy outside of their means. Whether it is a house, car, boat, RV, computer, entertainment system, or anything else, many people spend much more than they can actually afford. They get a loan that they struggle to pay back and end up buried under the debt.

Not Carefully Reading the Terms of a Loan

It is important to keep your finances organized and one of the best ways to do this is to review all of your statements and notices. When you apply for a loan or a line of credit, review everything carefully. Many times people get trapped in a loan with a huge interest rate attached to it and that can be enough to sink them.

Not Being Diverse With Investments

Money can make you more money when it is invested wisely but far too many people stick their money into just one account or investment. Whatever you choose- stocks, savings, CDs, or other investments, it usually is a good idea to divvy your money up between several different options. This can also protect you in case one investment goes sour.

No Plans for Retirement

Whatever your intentions are for retirement, you need to do what you can to save and plan ahead for that time of your life. Get a credit check regularly to know where you stand financially. Get a savings started for when you retire. It may be 40 years down the road, but the time to start planning for it is now.

Not Having Plans for the Family When You Are Gone

Getting a life insurance policy is one of the best things you can do to help protect your family’s financial security when you are gone. Humans do not like to think about death but it is something we need to try our best to plan for, if only for the sake of our family.

Joy Mali is an active blogger who is fond of writing articles on Bad Credit Loans and advising people to get mortgage even with bad credit. Follow her on Twitter to know & avoid the financial mistakes people commonly make.

Solve The Problems Of Solvency Ratios By Online Tutoring

These rates are measured to determine the ability of a firm to pay off its long-term reasonable responsibilities. Some people call them as long- phrase solvency rates. Important solvency rates are (i) reasonable financial obligations value amount (ii) finish sources to reasonable financial obligations amount (iii) unique amount.

(i) Debt value ratio
Meaning: this amount indicated the relationship between long- phrase reasonable responsibilities and the value (or traders fund) as such this amount is worked out by breaking long- phrase reasonable responsibilities by traders financial.

Formula: reasonable financial obligations value amount = reasonable financial obligations / value or long phrase reasonable responsibilities / traders sources or external sources / inner funds
Factors:

(a) Debts are long-term responsibilities having maturity after one year. It is also known as long- phrase sources (or external funds) debentures long-term loans form bank and financial companies and public deposits are examples of long-term reasonable responsibilities.

(b) Investor funds: it denotes the sum of preference talk about reasonable investment value talk about reasonable investment general reserve reasonable investment reserves securities premium balance and credit balance of income and loss A/c etc. by bogus sources (if any) like preliminary costs talk about problem costs discount on problem of share/debentures underwriting commission etc. should be deducted.

Alternatively it can be measured as non-current sources + existing sources existing liabilities

Significance: the reasonable financial obligations value amount of 2: 1 is the norm accepted by financial companies for financing projects it means reasonable financial obligations could be twice the value. This quantity reveals the comparative quantity of economical provided to the company by visitors and by the entrepreneurs. A low reasonable financial obligations value amount implies a greater claim of entrepreneurs on the sources than the loan companies in the organization. It provides security to loan companies on the other hand a high reasonable financial obligations value amount indicated that the claims of the loan companies are greater than those of the owners; it is taken as negative sign.

(ii) Total sources to reasonable financial obligations ratio
Meaning: this amount shows the relationship between finish sources and the long phrase reasonable responsibilities of the organization.
Formula: finish resource to reasonable debts amount = complete resources debt Factors
Factors:
(a) Total sources (tangible) contains all fixed sources, reasonable investment and existing sources but excludes bogus sources (if any). Investment contains business reasonable investment into shares or debentures of another organization for the purpose of promoting its own business or organization.

(b) The reasonable responsibilities (long phrase debts) have already been described in the context of reasonable financial obligations value amount.
Significance: this amount measures the proportion of finish sources borrowed by long-term reasonable financial obligations. The greater amount indicated that the level of inner ownership is more in income generating activates of an organization and versa.

Alternatively, a better way of making the amount is reasonable financial obligations to finish sources. In that case take reasonable investment employed (internal sources + external funds) instead of finish sources. This would give the level f organization belongings to guests. In fact, it will become the reciprocal of unique amount.

(iii) Proprietary ratio
Meaning: this amount indicated the relationship between value (shareholders fund) and finish real sources and is measured by breaking the traders financial (equity) by finish sources.
Formula: unique amount = traders sources or net worth / finish assets
Factors: both terms traders financial and finish sources (tangible) have already been described.

Significance: normally, unique amount attempts to indicate the part of finish sources borrowed through traders financial. A high unique amount is indicative of strong budget of the organization. The greater the amount, the better it is.

On the internet task help has refreshed and innovative the internet knowledge system by providing help in projects to the learners of all age group. These days, projects help solutions are very popular especially among the scholars who want have good chance by sparing more period in research instead of writing projects. They can simple get some additional a chance to study more and also complete their task sometimes that too from the professional task authors. These task help solutions are totally internet based and are easily online for helping learners with task related problems. One can find various major companies involved in making available different personalized task help and can contact them whenever they are in need of task help.

Reduce Your Financial Burdens with the Help of a Bankruptcy Lawyer

When you are facing financial problems in your life and feel that is no end to the mountain of debt you have buried yourself in, it is very common to feel despair and hopelessness. But, it is essential to understand that there are solutions for all types of problems. You are not the first person to find themselves in this situation, nor will you be the last. If you are feeling that you cannot continue to pay your debt obligations, then taking the assistance of a bankruptcy lawyer is the perfect solution to overcome your financial burdens. Once you hire a lawyer, it is the time to claim for bankruptcy.

A professional bankruptcy lawyer has skills, knowledge and experience to help you throughout this trying time. They have proper information about the laws and can make sure that your creditors are not violating your rights. They can get those persistent and annoying phone calls to stop. They offer effective guidance and advice to help you get your finance back in a systematic order. It is important to take some time to pick a good lawyer in your area. You need a professional lawyer who has a lot of experience and knowledge dealing with cases that are similar to yours.

You can do an extensive research with the help of the internet in order to find out the most reliable and experienced bankruptcy lawyer in your area. There is one leading law office that specializes in providing legal services and support. If you are looking for the highly experienced Bankruptcy lawyer Mechanicsburg, then look no further than this law office. They understand the frustration and pain you are experiencing. They have helped many clients through the process of bankruptcy. They have a team of attorneys who have established a strong reputation with a wide range of experience in bankruptcy law.

The main focus of these lawyers is on all levels of bankruptcy. If you are looking for debt relief and structured repayment, you can trust them. They understand the importance of your case and handle it in an effective manner. They reduce your financial distress in an effective manner. They serve the Mechanicsburg, York, Lebanon, Hershey and Harrisburg areas. If you are seeking the Chapter 13 lawyer Harrisburg, then your search ends here as they handle Chapter 7, Chapter 11 and Chapter 13 as well. You can visit their office that is located in very convenient location.

Financial Crisis Causing New Trend In Consumer Spending

The American economic crisis and personal security fears appear to be the driving force behind a recent surge in the sale of a number of consumer items, one of the most surprising of which is household safes.

Safe retailers and manufacturers had been reporting a dramatic increase in sales beginning with the start of the economic crisis, then elevating sales again as the market continued to dive.

Some manufacturers have reported up to a 50% increase in sales over this time last year. Despite the state of the economy and the negative effect on spending in general, there are a few markets that have seen an increase in sales.

Increases in demand for products like household safes, home electronics and firearms appear to be directly linked to the economic crisis. The Consumer Electronic Association has predicted that sales of certain electronics will increase despite the drop in allover consumer spending.

The CEA believes that people will spend a little money on home entertainment such as video games and televisions instead of a lot of money on outside dining and entertainment. Guns are another product that analysts are watching. Historically, the sale of guns rises during economic hardships. This is usually attributed to people’s fears of civil unrest and higher crime rates.

However, the surge in household safes may be unique to this particular economic crisis. The government seizure of Fannie Mae and Freddie Mac as well as the sale of financial heavyweights such as Merrill Lynch, Wachovia and Washington Mutual appear to have consumers fearing for their personal savings and investments more so than in previous economic downturns.

Authority Safes Sales Manager Janel Crisp has spoken with several customers expressing their concern for the economy and personal security. “We’ve had a lot of new customers saying they just want something where they can store their important papers, cash and jewelry, sometimes even gold in. They just want that sense of security that their vital possessions are nearby and safe,” she said.

This appears to be the trend throughout the market as more consumers are feeling the blow to their sense of financial security stemming from the collapse of financial institutions.

According to Crisp, since the start of the economic downturn began, sales have risen in specific areas, such as larger and stronger safes. “There has definitely been an increase in people asking for larger safes, over 500 pounds, and safes with burglary and fire protection ratings,”she said.

Without knowing when and how the economy will turn, there’s no way to know what kind of other economy-based consumer trends will be appearing. Until then, it seems consumers will continue to purchase the items that increase their sense of security and help them ride out the crisis.

Emotional Intelligence – Achieving Your Financial Dreams

A look at how can emotional intelligence make your dreams come true: Americans with a salary of $100,000 per year can become millionaires in a relatively short period of time. According to Thomas Stanly, Ph.D and William Danko, Ph.D. It is not rocket science and the solution is simple. The catch is, it may require you to reprioritize your entire life. Regardless of salary, you can achieve your financial goals.

When you put together a realistic plan, including your financial advisor’s advice, you start off on the right foot. Many become frustrated when their advisor explains, “You would need to either significantly increase your income or drastically change your life style to achieve those goals.” Many feel deflated at this point and loose their vision. Perhaps you shouldn’t be so quick to settle for something less. Instead, seriously examine the advice your financial advisor has provided you with and boldly consider the options.

In their book The Millionaire Next Door, Drs. Stanley and Danko examine individuals with relatively modest salaries who cultivated powerful financial resources. They distinctly describe two strategies that millionaires use to amass their fortunes. First, playing a good offense involves increasing income. Next, playing a good defense requires being frugal and reducing the level of expenses in your life.

Life Coaching Tips for Achieving your Financial Dreams:

1) A Good Offense: Significantly Increase your Income.

Do you have vision for your career? Some professionals focus on a career goal and some still search for their true passion. Where do you see yourself 5 years? Career markers are important because they help you plan and prepare. Some people sell themselves short or miscalculate risk. Some overestimate their abilities, leaving no back up plan and others suffer paralysis by analysis. Emotional intelligence skills help you stay centered and focused as you set out to methodically increase your income.

2) Play a Good Defense: Drastically Decrease your Expenses.

Don’t let go of your goals before examining your options. Financial coaching will help you explore those alternatives until they become realistic goals. Have you seriously considered living below your means? Most people get stuck when they have to give something up. Investment advisors familiar with behavioral finance know that you are more motivated by the fear of loosing something than you are by the prospect of gaining something. This applies to life style just as it applies to investments.

A story used to illustrate the millionaire mentality involved a husband’s birthday gift to his wife. Receiving more money in stocks than most people make in 5 years, she thanked her husband as they kissed goodbye. Then, she sat down and continued clipping coupons at the kitchen table.

With emotional intelligence skills, you can learn to let go of paralyzing fear responses. Without skills it becomes one more set of self-limiting beliefs. Have you ever told yourself the following? “I’ll start living frugally right after I put this one computer or plasma TV on my credit card.”

People are reluctant to talk about finances. Most people feel uncomfortable talking to even their therapist about personal finances. When smart people with high paying jobs have huge debt, it becomes “a dirty little secret.” People can feel more shame and embarrassment about their finances than they do about having an affair or a substance abuse problem.

The Emo-Economic Death Spiral:

Lacking emotional intelligence skills leads to the paralyzing effects that contribute to a unique kind of economic death spiral. It starts with negative judgments about yourself. Judgments lead to bad feelings, which lead to a desire to change how you feel. You spend money on something that makes you feel better, relieving your pain temporarily, but putting you further in debt. This prompts you to judge yourself harshly for making a bad decision, which makes you feel bad about yourself again. Now you need an experience or something of value to change how you feel, which puts you further in debt. You judge yourself harshly, which causes you to feel bad about yourself.

Include financial coaching in your plan and assess your emotional intelligence skills for gaps. Find your Achilles Heal when it comes to finances and learn how to manage it. Each individual has a unique set of challenges. Use life coaching exercises to find and fill emotional intelligence gaps.

Follow the advice your financial advisor gives you and don’t discount the options they provide. If you already use an executive coach or a life coach, re-examine your financial goals, making your dream realistic and achievable.

Director’s Financial Responsibilities

The new Association director is often thrust into the job with little idea of what his or her duties and responsibilities are, other than the conceptual knowledge that s/he is obligated to serve in the best interest of the Association. Unless s/he has been an active member of CAI (which is not likely if s/he is a first-time director), s/he is not even aware of the educational resources that are available for guidance in learning what a director’s responsibilities are. Further, many directors serve only a one-year term and therefore have little incentive to go through the effort of getting the education necessary for performing their job, since their term will be completed before they can even begin to learn everything they should know.

The purpose of this article is to attempt to provide guidance to the director on his or her financial responsibilities. The most important rule with respect to financial transactions is that they should be well-documented. While the Association may produce monthly financial statements and an annual budget, it is also important to document (preferably in the minutes of the Board of Directors) the following types of financial decisions:

Authorization for new bank accounts
Authorization of changes in signers of bank accounts
Approval of transfers of cash between accounts
Authorization for purchases of major equipment, or major expenditures
Approval of the annual budget
Acceptance of monthly treasurer’s report
Acceptance of monthly interim financial statements from the management company
Approval of the annual audit or review report and tax return
Authorization for an officer of the Association to sign the annual income tax returns
Documentation of board actions and responses with respect to the accountant’s management letter that accompanies the annual audit report
Collection actions (authorization to lien member property, authorization to foreclose on member property)
Documentation of board decisions regarding insurance coverage
Adoption of a conflict of interest policy
Authorization of contract for preparation of a reserve study
Authorization of reserve expenditures
Adoption of reserve policies
Adoption of Revenue Ruling 70-604 Election (This election should be made annually and should preferably be made at the annual membership meeting, then ratified at a Board of Directors meeting.)

Accounting is a complex, technical subject in which very few people have an active interest. However, the impact of financial transactions is something that permeates every aspect of our lives, and certainly that of a community association. While no individual can be given a complete accounting education in a short enough period of time to enable them to gain a complete understanding during their term of office, there are certain things that the director can and should do on a procedural basis that would allow him or her to adequately exercise the oversight of financial responsibilities of the members of the Board of Directors of an Association.

The director needs complete financial information in order to perform an adequate review of transactions. Accordingly, the monthly financial reporting package for a community Association should generally include the following documents:

Monthly financial statements

a. Balance Sheet on an accrual basis

b. Income Statement on an accrual basis with budget-to-actual comparisons ( The income statement should include both current month and year-to-date amounts.

General Ledger
Cash Disbursements Journal
Aged Assessments Receivable Listing
Copies of all bank reconciliations
Copies of all bank statements
Copies of paid invoices

While the above list may seem like overkill to some, these documents should be distributed to the board members prior to the Board meeting so that they have an adequate opportunity to review them and be ready at the time of the meeting to either approve the reports or ask the necessary questions. It is not reasonable to expect even a CPA to be given a set of financial statements during a Board meeting and on the spot, have to review, understand, and approve the financial statements and, by inference, the underlying transactions.

For the director to competently review this financial package, he must have a basic understanding of each of the documents.

The balance sheet is a statement that reflects the financial status of the Association at a specific point in time (generally month-end or year-end). Common components of a balance sheet are:

Assets

Cash – Petty cash on hand or in checking accounts, savings accounts, or other types of accounts with a financial institution

Assessments Receivable – Amounts owed by members to the Association as of the date of the financial report

Fixed Assets – Property acquired by the Association with a useful life greater than one year and of significant cost

Prepaid Expenses – Payments of expenses in the current period that will benefit more than one period, such as insurance, which is often paid in a single payment for an annual premium

Liabilities

Accounts Payable – Expenses incurred, but not yet paid

Prepaid Assessments – Dues/assessments paid in advance

Income Taxes Payable – Income taxes due for the current year and any prior years

Fund Balances

Operating Fund – Accumulated earnings or losses of the Association from the current and prior years.

Replacement Fund – Amount set aside for future repairs and replacements (this balance should have an equal amount of cash set aside to accumulate for major expenses).

The income statement reflects, for a period of time, the income and expense activities of the Association. A preferred format would reflect both the current month’s and year-to-date budgeted and actual activities. Revenues generally consist of member assessments, fines, vending machine, parking, or other income and interest income. Expenses would include operating maintenance costs, utilities, management company fees, and other administrative and operating fees. Amounts transferred to reserves are generally reflected as an expense of the operating budget, unless financial statements are prepared on a fund basis.

The general ledger is a document which underlies the financial statements and summarizes all activity by account. For instance, if three different checks during the month were written for repairs, they would be grouped into the repairs expense account (even though the checks were not in sequential order). The total of those three checks would represent the current month’s total repair expense, which should agree with the income statement. This document can be used by the director to research questions such as “what is in utility or repair expense this month?”, and “why is it so high compared to prior months or prior years?” The general ledger should provide sufficient detail for you to find the answer to that question.

The cash disbursements journal is simply a listing of checks in numerical order for the current month, listing the date, payee, and amount.

The other reports are self-explanatory.

The procedures that the director might employ in analyzing these documents should consist of:

Examine the balance sheet and compare it against prior periods to see that cash balances and assessments receivable balances appear reasonable. Note if there are any significant fluctuations between restricted reserves in the current period versus prior periods.

Examine the bank reconciliations and see that they agree to the amounts reflected as cash on the balance sheet. Investigate any differences. Also, make sure they agree with the bank statements. The bank reconciliation should begin with cash per bank and reconcile down to cash per financial statements and general ledger. The reconciling items will generally consist of deposits in transit and outstanding checks. Investigate and question any large or old outstanding checks.

Review the bank statements to ascertain that all interest income has been recorded in the financial statements.

Make sure that all bank accounts are recorded in the general ledger of the Association.

Examine the aged assessments receivable listing and compare it to the balance sheet. The total of assessments receivable should agree with the balance sheet.

Review the aged assessments receivable listing and question any assessments receivable that are more than 30 days old. The Association should adopt a strict collection policy that would consist of assessment of late charges, warning letters, filing of a lien, and ultimately foreclosing on member property for non-payment of assessments. There should be no exceptions to these rules, especially for directors of the Association.

Review the income statement comparison of budgeted to actual activity both for the current month and the year-to-date, and question any significant variations.

For any questioned income or expense items, trace the account to the general ledger and review the detail for that account.

Review the cash disbursements journal for the month and challenge the propriety of all expenses. For instance, if any checks are written to any director of the Association, find out why. If the management company is being paid more than their contractual fee, find out why.

It will take some time for the director to perform all of the above procedures, but it will provide you with insight as to the financial transactions of the Association, and a greater understanding of how your Association operates. While this may seem like too much work to be done on a monthly basis, you as a director have an obligation to the members of the Association to safeguard the assets of the Association. Only through diligence and a step-by-step procedural review of transactions can this be done.

Tranont Oneview Financial Dashboard Report

I take a close up look at Tranont Oneview and find out the truth about this revolutionary software and if it really is worth all of the hype.

I think that it is necessary to cover some elemental financial ideas before I go into the details on Tranont to make sure we are all on the same page.

The reason why is because if you do not fully understand the principles behind what Tranont is designed to help solve, you will not be able to fully understand all of its unique features.

With the economy in an absolute tailspin over the last few years it has never been as important in our lifetime to make sure our personal economy is not going following suite.

The last thing I want is to be an old man trying to survive on barebones and forced to work some miserable job I cannot stand because I fell for the slick marketing on tv and bought into the so called American dream of buy now but pay later.

Heck, it was just 30 years ago when the idea of having a computer in the home was completely farfetched and now it’s rare for someone not to have a computer but our kids are being taught the exact same poor ways to manage their finances as back then.

Sure right after World War II the standard advice of go to school, get a job, buy a house and retire on a pension was decent. After all the economy was booming and a household could make it on one income earners wages.

We are no longer living in that time though and the way we approach are finances has to revolutionize.

Tranont can literally change your financial outlook and in multiple ways, not the least of which is it’s proprietary oneview technology where you are able to see everything involving your personal economy on one screen.

It also uses algorithms to decode the best way for you to pay back your loans to get you ahead of the game so you are actually paying down principle each month instead of interest.

Most people have no idea how complicated the math is behind what would seem to be a simple finance charge but the truth is that banks have super computers running 24/7 to determine the most optimal way to charge you to bleed as much money from you as possible. Well I say no more!

There is also a really neat work at home option for those who want to make a little extra cash for simply referring the program while you are saving wads of money.

Somehow, someway we must figure out a way to take back control of our lives.

Tranont OneView is one of the most dynamic and important things you will ever discover when it comes to personal finance.

You owe it to yourself to look closely at Tranont and even if it is not right for you, it may just help put you on the path to financial freedom through other means.

Elements of Prudent Financial Advice

Many investors and their advisors are finding that investing today is more difficult than ever before. In times like these, the benefits of prudent financial advice are most evident, and the costs of poor decisions most clear. The following 6 elements of prudent financial advice can help guide investors and their advisors to be successful during these uncertain times.

(1) Recognize that Markets Work. It is important for investors to understand that capital market returns are out of their control. Securities prices will fluctuate as new information is continuously evaluated by investors and traders, creating an equilibrium in prices that reflect a trade-off between risk and return. Prudent financial advice is not about providing a forecast that attempts to predict the unpredictable. Investors and their advisors should not focus on what might happen next in the markets, but instead position their investments to try to capture as much of the return markets make available as possible. Investors can tilt their portfolios in the direction of certain risk factors to increase expected returns and re-balance when necessary, but they should resist trying to outguess the market. This could result in reduced returns and an increased likelihood of an undesired outcome.

(2) Manage Investment Risk. Some say we have become a society accustomed to immediate gratification and that we often want more than we should. Investors’ desire for higher returns has led to the expansion of many new and riskier investment products. Some purveyors of investment vehicles have created such highly complicated strategies that the risks are nearly impossible to understand, even by professionals. For example, former Fed Chairman Alan Greenspan recently said that even with his advanced training in mathematics he did not fully understand Collateralized Debt Obligations, one of the most significant problem assets owned by troubled banks, pension funds, and financial institutions.

Prudent financial advice is about managing risk by designing an investment portfolio that is highly diversified and exposed to risks associated with higher expected returns. In other words, prudent investors only take on an amount of risk they feel is appropriate for them, and try to limit their exposure to those risk factors for which there is not a reasonable expectation of higher returns.

(3) Focus on Education. Investors who understand investments and how markets work are better able to appreciate the primary elements of prudent investing. Educated investors have the knowledge to make smart financial decisions and are less likely to fall prey to inaccuracies, misstatements, or other potentially damaging ideas they may hear from securities salespeople, the popular press, or other investors. Educated clients are also better able to decipher noise from information, and fact from opinion. A well educated investor is a more confident and more successful investor.

(4) Elevate Fiduciary Responsibility. Some would say that much of the investment industry’s traditional way of doing business does not serve the best interests of investors. Any system whose revenues largely depend on persuading investors to trade and potentially take excessive risk is not likely to be focused on the best interests of the client. Such a system encourages short-term trading and speculation. I may also tend to promote the development of investment products designed to satisfy investor demand, which is often misplaced, especially at market extremes, rather than providing prudent investment solutions that are appropriate for investors.

Prudent financial advice is about structuring an investment strategy that is right for the investor, not one that reflects what an advisor is trying to sell, or what will earn the advisor the most fees and commissions. It should be designed to match each client’s appetite for risk, while helping them reach their financial goals with broad diversification and excellent personal service.

(5) Retain Transparency and Integrity. The multiple scandals we have seen during this downturn illustrate the unrecoverable costs that can result from a lack of transparency and integrity on the part of an unscrupulous advisor. Prudent financial advice means operating in a clear manner that provides for the safety of clients’ capital first and foremost. This can be accomplished by investing in properly regulated, publicly traded vehicles using third-party custodians to hold client funds and securities.

(6) Maintain Investment Principles. Too many investors tend to abandon their investment principles at just the wrong time. They may either take too much risk when things are prosperous and bad events seem unlikely, or too little risk after a major decline has occurred, possibly missing out on a subsequent recovery. Investors used to focus on the wisdom of long-term investing rather than the folly of short-term speculation. In recent times, however, Wall Street and other institutional investors have failed to regard risk properly. Instead of managing risk they magnified it with huge amounts of speculation and leverage.