Archive Monthly Archives: August 2019

The Honest Truth

Can we be brutally honest with each other for a minute?

If you are a business owner, you should not be doing your own bookkeeping; hand writing or printing checks, paying the bills, downloading credit card transactions, reimbursing cash receipts and expenses, etc. In the last few months I have met and talked to a number of business owners in the same spot at you are in some variation of it. Owners of startups, growing business, even established ones too, who say that they do all or part of the finance management.

I don’t want to come off rude, that’s not my intent here, but this just shouldn’t be. I know it is hard to let go of the control of making sure that every cent is accounted for when the business is your baby; your idea that you created, cultivated, and put into motion. It’s like letting go of the handle bars on your child’s first bike ride. But you have to do it sooner or later, otherwise your baby will never grow and prosper.

In this world, time is money. And your time is worth a lot of money. I am willing to bet that your hourly wage is a lot more than paying a bookkeeper, so the argument that you don’t have enough money to pay a bookkeeper, that doesn’t really work here. For every working minute you are working on tasks that are not 1) part of your scope of work or 2) business development, you are wasting your time and money. What does that mean? Well, unfortunately that means that you are not only not making money, but you are also losing it.

Don’t believe me? Well without going into too much of a cost analysis, if you bill your services at $150 an hour and a bookkeeper charges anywhere from $55-$85 an hour, for every hour you personally spend on financial tasks, you are losing $65-$90 an hour that you could be making elsewhere. Just let that sink in for a minute.

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So why not find someone you can trust and have faith in, who can take care of your finances and report all of the details to you?  It doesn’t have to be me (although I would truly love to help you take these services off your plate and start putting more time into your business), but it should be someone capable and qualified, not uncle Bob or your neighbor.  How about making that a 3rd or 4th quarter goal you can feel good about and let me know how it goes.

8 Mid-Year Business Tips

As the summer winds down and kids are going back to school, it is a great time for home owners and businesses to start getting their heads back in the game and considering their end of the year preparations.  Here are 8 mid-year finance and operation tips I put together from my 11 years of experience managing businesses. Please keep in mind, some recommendations may not apply due to the the size, industry or fiscal year of your company, but it is important to be aware and discuss these topics with your bookkeeper, CFO and or accountant.

Finances

  • Complete a brief review of your books, checking for errors in the accounts expenses and incomes were attributed to.  Correcting an error now will help you avoid 1) repeating it and 2) having to correct (or pay your accountant) at the end of the tax year.  If you expect to be audited, as many government contractors do, get ahead of those preparations early!
  • Forecast the rest of your fiscal year. If you know you historically have slow or heavy business in the second half, you will want to start planning for your upcoming expenses, incomes, and even HR needs.
  • Depending on your previous review and forecast, start saving for taxes, employees raises, bonus, and any slow periods. If you know a heavy business load is coming, you can also plan out how to use funds for the rest of the year and pay off debt from earlier in the year.
  • Have your Tax Accountant of CPA take a brief look at your reports as well. Not a full analysis, but a review. If you can afford an early tax payment after a good half of the year, you won't have to worry as much come the end of the year.

Operations

  • Depending on your financial status, or your HR needs, you should consider any upcoming hiring early. You will need at least 2 but usually 3 months to put together an employment description, advertise, interview, hire and onboard.
  • Whether or not you are hiring now, any down time or before you have requirements, is a great time to review your employment descriptions, policies, procedures, and handbook. You should consider your current office, company culture, employees, and the direction you want your business to go in and then be sure that your documents all reflect that.
  • Organize and declutter! (I couldn't resist). Gather up old documents, records, files, receipts that are past 7 years and take them to be shredded.  Now 7 years is the general standard, but be sure to check with your industry specific standards and legal requirements.
  • Start considering your business goals and intentions for next year. It is never a bad time to start working toward those and some may need a little prep work before they can be achieved.

And of course, if you are feeling overwhelmed, confused or interesting in having assistance with any of these tasks, I am here to help!  Please do not hesitate to contact me.  Have a great rest of your summer!

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