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The AA, which produces the British Insurance Premium Index, reported last year that car insurance premiums had fallen slightly, by an average of around £2.00.  In other words – not a lot!  Sadly, for many drivers especially young drivers this fall will make very little difference.  The cost of young drivers car insurance is now causing concern at government level as one MP has highlighted the high costs of car insurance as being partly responsible for limiting access to work for those in their late teens and early twenties.  With unemployment at extremely high levels and the phrase ‘NEET’ hardly ever out of the press, there is good cause for concern.  For those seeking care jobs, access to a car can be crucial and the problem is particularly acute in rural areas.  For young rural drivers there are very limited opportunities and the lack of public transport means that young people have no choice but to rely on their own transport to access employment and training.

Imaginative Solutions

The main problem faced by those searching for young driver’s car insurance is that they fall into a high risk category.  Young male drivers under the age of 25 are considered one of the highest risk categories with an alarming number of this group being involved in fatal accidents.  Legislation in the last couple of years from the European courts has meant that young women are no longer able to access “discriminatory” lower premiums, despite statistically less likely to be involved in accidents than their male contemporaries.  The simple fact is that those likely to be on the lowest level of the wage scale face premiums that can average over £3000.  With the added high cost of fuel which is unlikely to drop, this results in a seemingly impossible situation for many.  Nigel Evans, the MP for Ribble Valley has called for insurers to help to tackle this problem, arguing that “imaginative” solutions need to be found.

Catch 22

While some may argue that car ownership amongst the young is now a luxury, the problems caused by the high costs run far deeper.  As Evans points out, many younger drivers are facing a Catch 22 situation; unable to access work without a car and not being able to run one without work.  Insult is added to  injury by the fact that employment status is also a factor used to work out the premium.  The problem, as already mentioned is particularly acute for young rural drivers who may face long commutes to find work or attend college/training courses, with high petrol costs and low wages.  The problem is compounded for this group by the fact that the few available opportunities in rural areas are usually in the lowest paid sectors such as farming, hospitality or the care industry.

Positive Actions

Solutions that have been mooted include offering rebates on insurance after a no-claims period or premiums based on scores gained during the practical test.  In addition there are now schemes being introduced by car insurance companies including the AA, to fit ‘black box’ devices to the car.  Available to any driver, these are particularly being marketed to the young driver’s car insurance sector.  Monitoring the actual skills of the driver and adjusting premiums to reflect skill, ability and safety, these may ultimately provide an ideal solution for younger drivers.  AA officials have also said that younger drivers can take positive action to reduce their own premiums, such as reducing their mileage, buying an older car and shopping around for insurance.

The high costs of young driver’s car insurance is now causing concern at government level, being cited as one bar to employment for many young people.  While the government calls for ‘imaginative’ solutions, industry experts continue to place the onus on young drivers to take steps to reduce their own premiums.

In today’s competitive environment business accounting services are essential for firms, in order to stay ahead of the curve. Keeping a record of all transactions for example bookkeeping services allows firms to assess their current performance which then forms the ideal platform to forecast budgets and plan for their future growth strategies. These entries are consolidated to form Financial Statements which reflect crucial information such as sales, debtors, creditors, liquidity etc. These then can be compared to industry wise figures and past years’ figures to analyze business performance. Through this, business accounting services assist in the firm functioning efficiently.

Business Accounting Services – Crucial for Start up Companies

Business accounting services provide newly-launched firms the model support they need to grow and flourish. They advise firms on the most efficient ways of financing their venture and also offer assistance in obtaining finance. Obtaining funding has many hurdles to it, especially in today’s financial market as financial institutions tend to be averse especially towards new small businesses.

Start-up firms typically have a choice between debt and equity financing, and the accounting firm handles the responsibility of analyzing available options. This includes an extensive study of the industry as well as the the financial position of the owners, following which the best alternative is suggested.

For example, if the new entrepreneurs of the new company are financially strong and have cash available for investment, then debt financing might be the way forward since money can be borrowed against liquid assets. For industries which are profitable but cash inflow takes time to kick in, equity finance might be the best way to go about, as cash may not be sufficient at an early stage to service debt and mark up.

Business accounting services also guide start up companies regarding the business structure that suits their specific industry the most. From a tax perspective, this is crucial because different business structures have varying tax obligations. Business structure also has an effect on the paperwork in the company, personal liability and the company’s ability to raise money. Therefore this decision is crucial and the accountants ensure the journey begins on the right track. It further helps start-up companies by formally registering their business and assists them in obtaining bank accounts.

Business Accounting Services – A Stepping Stone For Established Companies

Apart from providing bookkeeping services, business accounting services construct financial statements and prepare reports on performance, profitability and liquidity and help firms efficiently manage their payroll. Additionally, the firm also manages and provides employers with data on former and current employees and if required also help screen potential employees

Tax season is usually a nightmare for all companies, whether new or established. As a result, there is nothing more comforting than having tax calculations taken care of, which allows entrepreneurs to concentrate on the core functioning of the business, and on making it more profitable. Tax services include payroll taxes, taxation on company assets such as properties and cars, capital gains tax etc.

As part of the package, payroll taxes are also handled which are either levied directly on employers as a proportion of the salary payout or employers are required to withhold and thus income taxes at source. In either case, the service ensures smooth and efficient functioning and helps the untrained businessman avoid legal complexities and technical jargon.

On a personal level, business accounting services helps seasoned businessmen improve their work life balance which reduces stress levels. They enable the business to plan for the future and explore new ideas. They work on the business rather than “in” it and hence have a fresh perspective. This in turn gives rise to innovative ideas allowing the business to succeed and achieve various milestones.

Anthony Azevedo, CPA is the managing member of EZCFO a bookkeeping company focused on business accounting services.

As we approach the end of the fiscal year, many business owners will need to ensure everything is in order for their tax return. If you are the owner of a new or small business, you may be a little concerned at this point in time especially if things are a little uncertain with regards to your financial position at present, which is the why the following guide has been comprised to offer simple advice.

Get Your Books in Order Today

Looking at the books gathering dust is such a common thing, but now really is the time to brush them off and start the process of getting them in order. A bookkeeper is always an asset to a company but if you are not able to pay their wage then this is something you must take control of yourself. There are many online resources that will help you get to grips with what is involved so take some time out of your schedule to read a few guides and start the process of getting everything in order.

Analyse your Financial Position

There is no better time to analyse your business finances than in the run up to the end of the financial year. After you have completed the books and have all the information you need, the main documents to look at will be the balance, income and cash flow sheets. Take the time to carefully understand each of these as this will give you a good idea of the position you will be in at the start of the new financial year.

Discuss Finance Issues with Experts

There will be times where this analysis will send alarm bells ringing due to unhealthy looking finances, in which case it is always best to turn to the experts. Business recovery specialists in your area are the best people to speak to as they will understand the business in relation to the area you are operating in. Discussing your recovery options as soon as possible will give you the best chance of finding a solution to your financial difficulties in time for the new fiscal year.

If you are having trouble getting to grips with what needs to be done ahead of the new financial year, take some time to go through these points and conduct your own research through discussing your circumstances with other business professionals who can lend a helping hand.

Sophie works alongside a specialist business recovery organisation that has helped numerous companies across industry sectors to regain control of their finances and make a success of their business.

In this post I’d like to address the question, ‘What is foreign exchange market sentiment?’ This might be useful if you’re thinking about changing currencies, but have heard that sentiment toward the UK pound or euro or whichever currency you’re trading is negative, and want to know what this means.

Foreign exchange sentiment is the general feeling toward a currency at a particular time, among investors on the foreign exchange market. It’s a summation of how the countless millions of investors in foreign exchange feel about one currency at present. Sentiment can become more upbeat or downbeat, depending on what’s influencing that currency on a certain day or month. It can also be used to describe the mood on the foreign exchange market as a whole.

For instance then, when looking at sentiment on the foreign exchange market as a whole, one very common way is to describe the market as either having risk appetite or being risk averse. This tells us whether foreign exchange investors are feeling brave (i.e. there is risk appetite) meaning they’re more likely to invest in small or riskier currencies, or whether they’re being cautious, and hence putting their funds in strong and stable economies believed to be safe (i.e. they’re risk averse.)

Depending on whether there is risk appetite or not, the entire outlook for the foreign exchange market can change. The US dollar for instance tends to strengthen when there is risk aversion (i.e. there’s a big political or economic threat in the world) because the US economy is the backbone of the global system. It’s hence a safe place to put money. The UK pound too tends to benefit in times of risk aversion, because it’s thought stable. On the other hand, currencies in smaller and less stable economies such as New Zealand and Canada (whose prospects are tied to the price of commodities) tend not to benefit when there is risk aversion.

In addition to looking at sentiment on the foreign exchange market as a whole, you can also look at sentiment concerning a specific currency. This tends to reflect not the global outlook, but the factors affecting that particular currency at a certain time. These factors tend to be political or economic. For instance then, if you’re looking at the euro right now, you might say that sentiment is cautious but optimistic, because Greece has just received its second EU bailout. This has cheered investors. On the other hand, cautious remains because Europe is in recession right now. This is reflected in euro weakness.

You should now have a better idea what foreign exchange market sentiment is. If you have any other questions about foreign currency exchange then visit foreign exchange specialists Pure FX. 

Are the largest insurance companies the best?  There are a lot of factors to consider in determining that answer, and more often than not, the answer depends upon your insurance needs.  Large insurance companies can offer benefits to customers such as:

–         More Claims Service Centers

–         More Conveniently Located Agents (depending on their business model)

–         More Property Damage Evaluators

So what are some other possible benefits?  A larger volume of policies and clients who hold them can make a difference for you as an individual policyholder. When there are many people who have insurance with the same company, it can focus less on the profit margin made from each individual customer.  More clients mean a greater chance for an insurer to make profits, even with a lower profit margin on each policy.

For example, if two companies had a goal to make $100 profit, a company with 100 customers would need to charge those customers just $1 above and beyond the cost of the policy, while a company with only 50 would need to charge $2 per customer.  Customers with the second company will be paying more than with the first.  There are economies of scale in play.

But Not Always

There is a downside to working with a larger business that can factor in to how much you would pay as its customer.  The cost of doing business, from the overhead, to advertising, to attracting as many customer as possible, to the number of claims that must be paid out, can put a greater burden on a large insurance company and forces them to pass those expenses down to their customers.

Typically, though, a large company will closely monitor its business expenses and limit their expenses.  This may even mean lower payouts for claims as evidenced with all the controversy of the Colossus computer claim evaluation system.

Smaller companies have also gotten more efficient and some have even switched to a largely automated system, which can greatly reduce their overall costs.  Smaller companies may also target specific types of customers with a lower risk of accidents.  With fewer costs, these businesses can offer lower rates to their customers, which can be even lower than their larger competitors.

Size Isn’t Always a Mark of Better or Worse

Sometimes, whether one company is better or worse than another is not a matter of price alone and isn’t something that you will be able to decide without knowing a bit about the individual business.  Businesses large and small have moved toward more automated systems, and that can mean less personal contact when you need answers and less familiarity with your agent if you should get in an accident.

In other businesses, smaller businesses tend to have a more personal touch while larger corporations appear cold or faceless, but that isn’t always true when it comes to insurance.  While the overall company may be large, individual offices and local agents provide the same one-on-one interaction that you might come to expect from a small business.

Size will also have little effect on the company’s willingness to pay out should you be involved in an accident.  Some companies can be notoriously terrible to work with if a claim is filed while others will make the process go as smoothly as possible.  Take the time to research the company to make sure you are comfortable being an insured and they strike the right balance of price and service.