I. Read and translate this text:

Money and Time Spent Planning is your First and Wisest Investment!

Every year more new businesses are started than the previous year, and every year more businesses fail… One of the most often asked questions is, “What do I do to start up a business?’ Here are a few steps to take, and things to consider, before opening a business.

The First Phase: Making a Personal Commitment.

Most new businesses fail within two years. There are many reasons for this, but one fact is known about successful businesses. In order for a business to success it must be properly planned from the beginning. Many decisions need to be made before the announcement ‘Open for Business” is broadcast.

Successful businesses almost always start with a comprehensive business plan with special attention to accounting and finance. To be successful, entrepreneurs usually need the help of professionals to complete the large amount of paperwork and planning involved. An investment brochure, professionally made and distributed, is often the only difference between a well-funded project and one that fails, simply because sufficient operating capital was not available. The day of going into your local community bank and getting a loan from them based on ‘a good idea’ are long gone. If an entrepreneur needs to go somewhere other than a bank, good paperwork becomes even more important! Venture capital is money that is risked. Those who risk money to entrepreneurs want to know that every important consideration of a business has been made and documented properly.

Entrepreneurs must plan to have an adequate amount of money to fund their business. Start-ups usually require more cash than anticipated by even the most conservative expectations. A new business requires sufficient capital to endure unexpected hardships. Without sufficient funding to get the business off the ground, to persevere through business slumps, to carry receivables, and meet inventory and staffing needs, a business most certainly will fail.

Phase Two: Deciding the Form of Business Entity

Once one has an unshakable decision to start a business, the next step is to decide what type of business the entrepreneur should form. When setting up a business several choices are available. Many things should be considered when making the choices. Some of the most important considerations are the tax codes and laws governing the degree of personal liability an owner must assume for his business. Foe example a business can be set up as an unincorporated partnership, a proprietorship, or limited liability company (LLC). In all of these companies the tax responsibilities of the company pass through to the owner. A business also can be set up as a corporation, which has its own tax consequences, but limits personal liability of the owner. Additionally an s-corporation may be set up which passes the tax liability through to the owners, but protects them from personal liabilities in other areas.

Many small business owners choose the corporate form of operation because of the protection it affords an owner’s personal assets. LLCs also provide this protection.

Establishing the form of the business is often the first area in which an entrepreneur must seek outside consultation. A person going into business for the first time should consult a qualified business professional and then employ an attorney to finalize the decision and perform the required paperwork and filings.

Phase Three: Deciding on an Accounting Procedural Policy

After the new entrepreneur decides what form of a business entity to establish, he must decide on accounting methods and financial recording methods the company will utilize. This can mean the differences between having a profit and paying it in taxes. It is not how much that a business makes, but how much it keeps that determines the profitability. This decision should not be taken lightly. The long term applications of any choice are that often the IRS (the Internal Revenue Service – the US government department that collects taxes) will not allow a change, or may only allow for a gradual phasing-in of a change. This is particularly true when tax advantages are made available to the business person as a result of the change.

One of the first factors to be decided on is the method or ‘basis’ of accounting.

Choosing the fiscal year is another important decision the owner of a small business must make. As a general rule however, only corporations have flexibility in deciding the fiscal year. Proprietorships, LLCs and most Sub ‘S’ corporations are restricted to calendar year endings. Corporations may use information like seasonal trends, and utility to the owner are considerations.

Phase Four: Begin the Formulations of the Business

Prepare a written business plan. With all the above decisions made, a business plan spelling them out, with financial projections, initial investments, operational cash flow, identified suppliers, customers or market niche, competition analysis, physical plant needs, operational needs expenses, anticipated income, and anticipated problems that may arise with associated solutions, and any other pertinent information should be prepared. Also included in a business plan should be any already identified investment capital sources and avenues, along with budgets. The business person, who thinks he has these things ‘in his head’ and not on paper, often doesn’t have as much of it as he believes. The actual written document must be prepared. Money spent with a professional business plan is the best money a new business person can spend.

Secure the needed capital. Bank loans, investors, lines of credit, and government programs may be used singularly or in combination to fund a business. If sufficient funds can’t be identified as such, then revisions to the business plan, or abandoning the venture is in order. A professional loan broker, who has been provided the pertinent business plan and documents, is a very wise choice. The time spent going ‘door to door’ to find your needed capital can be better spent establishing the commerce of the enterprise. A good broker can develop a plan in which venture capital proceeds will be used to pay him for his efforts, and include that information in the offering brochure. Standard scales for these services can run as high as 5% of the capital raised, with lower percentages on larger funding amounts.

Once the entrepreneur has accomplished these steps, he is ready to begin the activities of his commerce!

II. Match the equivalents:

1. Business owner	a) Оборотный капитал
2. Business plan	b)Компания с ограниченной ответственностью
3. Cash	c) Капитал, вложенный в новое предприятие
4. Expansion	d) Предприниматель, идущий на риск
5. Financial projections	f) Метод бухгалтерской отчетности
6. Financial statement	g) Бизнес план
7. Fund (v) business	h) Получить ссуду
8. Get (v) a loan	i) Финансовый год
9. Limited liability company	j) Владелец бизнеса
10.operating capital	к) Финансовый отчет
11. Return	l) Единоличная корпорация
12. S- corporation	m) Предприниматель
13. Slump (n)	n) Единоличное товарищество
14. Start-up	o) Наличность
15. Unincorporated partnership	p) Ввод в действие
16. Venture capital	q) Расширение
17. Venture capitalist	r) Сезонный тренд
18. Accounting methods	s) Кредитная линия
19. Company’s assets	t) Финансовый прогноз
20. Fiscal year	u) Доход, поступления
21.Seasonal trend	v) Финансировать бизнес
22. Cost of goods sold	w) Ожидаемая прибыль
23. Anticipated income	x) Стоимость проданных товаров
24. Line of credit	y) Активы (имущество) компании
25. Entrepreneur	z) Резкий спад, снижение спроса