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Accounting is an essential part of running a successful small business. It involves tracking financial information such as income and expenses, using accounting software or traditional bookkeeping methods to keep records of transactions, and preparing reports like the income statement, balance sheet, and cashflow statement.

Why is accounting important for businesses? For one thing, accounting helps businesses understand their financial position at any given point in time. This can help owners make better decisions about managing their business operations and finances. Additionally, accounting can provide valuable insights into how well a business is performing compared to its competitors and industry norms.

Another key role of accounting is recording debits and credits for all financial transactions that take place within the business. Accounting systems use these debits and credits to create a balance sheet, which provides an overview of a business's assets, liabilities, and equity. Additionally, accounting software can also be used to create a cashflow statement, which helps businesses understand the flow of their incoming and outgoing funds.

Whether you are running a small business or managing accounting for a larger organization, knowledge of accounting basics is essential. Whether you are analyzing financial statements or entering transactions into the general ledger, understanding accounting concepts will help you make better decisions and contribute more effectively to your organization's success. So if you're looking to boost your accounting skills and knowledge, start with learning about balance sheets and cashflow statements today!

In accounting, one of the most important tools is the income statement, which helps businesses understand their incoming and outgoing funds. This statement provides an overview of a company's revenues and expenses during a certain period of time, such as a quarter or year. It can also give insight into how well a business is performing over time and help with strategic planning for future growth.

In addition to analyzing financial statements, accounting professionals are responsible for recording transactions in the general ledger and maintaining accurate records of all financial activity within an organization. Whether you work as a bookkeeper or accounting manager, it is essential to have strong knowledge of debits and credits and other basic accounting concepts. With these skills under your belt, you'll be able to contribute more effectively to financial reporting and management decisions.

Financial accounting is an integral part of any business, large or small. Whether you're analyzing a company's financial statements on a quarterly or yearly basis, accounting provides important insights into the health and performance of a business. Additionally, accounting helps businesses plan for the future by providing insight into how current trends are impacting revenue, expenses, and cash flow.

Whether you work in accounting as a bookkeeper or accounting manager, it's essential that you have strong knowledge of debits and credits and other basic accounting concepts. With these skills under your belt, you'll be able to provide more valuable insights to key decision-makers within your organization and help ensure that your business continues to thrive in today's dynamic marketplace.

At its core, accounting is simply the process of tracking and analyzing financial data for a business. This can include things like revenue, expenses, cash flow, and assets, all of which are essential to understanding how your business is performing and where you can make improvements.

Whether you're running a small business or overseeing accounting at a larger organization, accounting plays a critical role in helping you make smart decisions about the direction of your company. So if you want to be successful in this field, it's important to stay up-to-date on accounting best practices and trends so that you can provide valuable insights and guidance to others within your organization. Good luck!

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Does your agency have an office?

Are you 100% all in the office or have a combined remote working & in person office work?

These questions matter and statistically vary from age group to age group.



Human interaction






Office = expensive


What to do?

Think of your current staff,

No one-size-fits-all

Have you raised your prices in the past 12 months?

If not, you probably need to.

This is because of inflation, think of gas prices now versus a couple years ago (or even months ago).

$1 today is not the same as $1  'X' years ago... or 'Y' years into the future.

And it's kind of an expensive time to be living right now and you probably need to increase your fees.

I.e. Therefore, for you to provide same level of service (ex. because of increase in agency expenses), you need to charge more or you will be losing money.

Don't just take our word for it:

CTV News - Canada's inflation rate hits three-decade high of 6.8 per cent: StatCan


#Klndabooks #Klndabookkeeping


What the FLIP: HST?

HST = HARMONIZED SALES TAX, it's the tax you see on most receipts you receive as it is an end consumer tax.

As soon as you bill over $30,000 then you are not a "small supplier" anymore and must register for an HST number and start charging HST on your invoices.


It's 2022 and you billed $29,000 so far for your agency's services, since you are almost at threshold for HST number and notifying client that you will begin to charge HST (13% tax here in ON). You can elect to voluntarily charge HST whenever you want below threshold before it becomes mandatory.

Your digital marketing services you bill one client

$1,200+HST (13%)


The $156 you collected, you need to remit to the CRA quarterly/ yearly/ or monthly.

Do no spend this as it's not your money and it is due to the gov't.

This HST has nothing to do with your personal taxes/ sole proprietor taxes.

From that $1,200 you collected (less expenses), you will be taxed a % depending on your tax rate.

Let's say the entire year was this one $1,200 invoice and you had no expenses. Your tax rate assume 12.75%

You would owe the government / CRA

($1,200*Taxrate) + $156 in HST

= 153 + 156

= $309

would be your total tax liability all else equal.


An HST return is basically HST collected - HST spent (on your expenses)

Since you already gave HST to another business (as an expense) you don't need to pay it to the government.

This HST you charge, you must remit to the CRA at the end of the year so do not spend this money. However, the HST you spend on purchases, you can reduce the HST owing by the HST you have spent out.

You must put this HST number on your invoice as well so the receiving company can use this for THEIR HST tax credit.



GO to Netfile

Put in your business number (hst number) followed by RT0001

Put in your access code number

Reporting period, most other fields probably do not apply.

Next page allows you to enter the HST collected

Net this amount from the HST on the receipts you have spent

Gives you the total you need to file and pay.

If you have any questions re: your HST situation, please let us know we'd love to help.

Spending too much too soon

So you have some clients and you think you are on top of the world, which is great, but sometimes it doesn't work out and clients leave... and they will, you cannot satisfy everyone and people rely on revenues being 100% into the future. If you are not acquiring new clients, you are falling behind and client churn will eat your agency alive. Expect some clients will constantly be shopping around and you cannot hand hold all your clients and scale. This means that fancy new office you signed a lease on might be too expensive.

No financial direction

Can you accurately price a potential new client on a call? Do you know how much you are spending per month on salaries, office expenses, apps? Cash is royalty and you need to understand where every dollar is going so you can invest when needed and stop spending in certain areas.

Agency owners also like to forget about the CRA and what is due to them! When your invoicing your clients, there's that 13% HST that is NOT YOURS to spend and you are just holding it for the government. Always know your tax liabilities so you actually know how much money you can reinvest or take out without putting financial strain on the agency. Nothing is worse than being extremely tight for money.

Working only in the agency, not on the agency

Are you running an agency or are you a consultant? There is a huge difference in what you would charge and how you spend your time. Running an agency means you are selling marketing packages, being a consultant means you are billing for your hours. As a consultant you are limited to how much time you have, whereas an agency can have virtually limitless clients. If you are trying to start an agency and spending too much time on client work, you can't focus on new client acquisition, research & dev, keeping your staff happy, and other CEO related tasks.

Agency plan is missing

An agency plan will keep you motivated and give you direction, this is key for benchmarking progress and determining where you need to focus your time. Without an agency plan, where are you going?

Not staying with the times

The creative process is changing, automation is rampant in virtually all departments of the modern agency. Not automating and ignoring changes in how businesses are functioning will cut your growth and you will not be around for long.

A bookkeeper is one who takes care of the bookkeeping function of an organization. An online one, is just that, a bookkeeper that works with clients online. An online bookkeeper is deemed a "more modern" bookkeeper because online bookkeeping is a relatively new type of bookkeeping. Bookkeeping used to be done using actual books, only physical invoices, receipts, purchase orders and other physical, financial related documents, and it was very tedious and took a lot more time to process these documents compared to how fast they can be processed today.

A modern bookkeeper is one who uses the "most advanced" accounting technology for your specific industry thats available.

Bookkeeping and accounting are intertwined in the sense that a bookkeeper may perform full cycle accounting where an accountant does not usually do any day-to-day processing of an organization's transactions but tasked with making sure the financials are produced (Profit & Loss Statement, Balance Sheet Statement, Cash Flow Statement) and the organizations obligatory tax filings are being filed (For a corporation you need to file a T2).

Bookkeeping can be done both manually or you can subscribe to an app that takes care of your bookkeeping.

What's the difference between having a traditional bookkeeper using using a bookkeeping firm and having a bookkeeping app with added support?


Charges per hour

One-person shop


A number of bookkeepers

Technologically versed in limited number of apps


A person who utilizes online bookkeeping apps to prepare the bookkeeping entries and transactions for a number of clients. They may or may not complete tax returns for the company.

Your agency needs a business plan!

Doesn't need to be hundreds of pages with exhibits and graphics, but you need to have something.

What's in an agency plan?


How will a new client on-boarding process look & feel like?

How is your team organized & task workflow?

Who needs to

Financial Forecasts




Market Analysis

These are the essentials, how it's structured and presented is totally up to you.

The creative squeeze.

With on premise data storage and software being a thing of the past, companies are turning to all cloud based apps and team structure. What does this mean? This means a big squeeze for creative agencies to pump out more sales-converting-creative-assets, faster, and for less.

The process flow on which you onboard and start producing needs to be fast and efficient.

The analytics need to be on point. This usually means a specialization in an industry as to gain expertise.

Accounting school for those who aren't so good at numbers but need to be.

This information is useful for those yearning to get into the creative industry and want to start picking up some much needed accounting skills and know how!

Now where to begin?

Point of accounting is to know how much $$$ you are making (profits) and how much money you owe the CRA (Canada Revenue Agency). Or how much money you are losing...

You generate profit by selling your agency services (Agency Sales) for more than it costs you to build out said services (Cost of Agency Sales or COS).


Probably some expenses not directly related to a specific client, but needed to run your agency.

This would be your agency's operating expenses (OPX).


After you subtract taxes (corporate taxes) from that you get your agency's Net Income.


And then bam, you know how to calculate your agency's net income after corp taxes.

All of this info would be found on the accounting statement known as the "Income Statement" aka "Profit and Loss Statement" aka how much money is my agency making over X period of time.

Ok great, so let's say this past year you invoiced $120,000 for social media management and you spent $45,000 on graphics and you started Jan 01, 2021 and your fiscal year end is Dec 31, 2021. And this is your first year of business.

$120,000 Sales

$45,000 COGS


$12,000 OPX


T (if you are incorporated, you'd fill out a T2 form and submit to CRA, this is due 6 months after your year end, they want the money within 3 months though)

NI This is how much money you get to take home... not quite

Depending on you would pay yourself, there are even more taxes.

If this stresses you out, stop stressing, Klnda can help you automate all your accounting needs and is supported by the friendly team flip 😀