What would happen if your venders are slow in generating credits on returned merchandise, or what about lost 2% discounts, or how about being put on credit hold because you get out a couple of payments a little late. The accounting system your accountant gave you works great for tax preparation at the end of the year, when the books finally get caught up. But how about managing the business week to week. What is the real gross profit percentage?? How much is the warehouse costing each month and how much is each unit of product costing to handle and distribute??
So now you put out a hiring ad for a bookkeeper in the Sunday Times and get over 100 responses. How many are really qualified? Five? Six? Maybe Ten?? What if the wrong candidate is hired. How much time will go by before you discover the problems have grown worse.
Now cash flow grinds to a halt and you have to invest more cash in the business and cannot understand why. Even worse, the end of the year financial statements have gone to the bank and now you have to explain why the business has not met the covenants set forth in the loan agreements and why the business has lost money.
The cost of hiring a full-time financial manager can range from $60,000 to over $100,000 per year plus bonuses and benefits. Wouldn't it be great if you could get the benefits of a full time financial officer AND realize a return on your accounting investment? Our contract financial management service is designed to help your business do just that...give your business a net return on that investment!
The cost of hiring a bookkeeper at $15 per hour will cost your business $31,200 a year, and that does not include taxes, compensation, benefits, and the cost of maintaining his or her payroll. We have not even taken into account the possible other costs, like
Cost of hiring
Cost of running and placing ad
Cost of training
Cost of errors
Cost of having inaccurate and untimely information availiable to run the business
Cost of uncollectible or slow paying customer accounts
Cost of extra work by CPA at year end to correct records in order to prepare a complete
and accurate income tax return
Cost of duplicate payments to vendors, IE paying from statements, not the original invoices
Cost of overpaying sales tax
Cost of beginner's errors, etc, etc.
Employee drama, unexpected interuptions, etc.
Perhaps a potential solution may have a spouse or loyal employee, say, a secretary or receiver, take the role of office manager. If that individual does not have the PROPER FORMAL TRAINING OR EXPERIENCE, then the company will risk facing the same problems as above, so the company is back to square one, so what have we accomplished??
With respect to throwing a spouse, significant other, or loyal employee at the problem, a spouse or concerned other should be give the consideration of being able to offer general supervision, at first, and slowly enter into the role of full charge bookkeeper only when and if that person is ready and if he or she is suited to the role. Failure to do this will certainly create frustration and other problems for all parties concerned. So where's the cost savings??
Today's answer to many of these problems is to outsource your bookkeeping.
6 Reasons small businesses outsourced their bookkeeping and financial management
- They can cut cost by up to $50,000 per year when they outsource the bookkeeping function, as compared to a full time in-house bookkeeper
- They can cut employee drama and management time to zero
- They can access accurate, current numbers every morning – numbers that allow them to manage using the 80/20 rule so they can focus on what they do well
- They can see their net cash flow double in 120 to 180 days, when they use good financials and focus on their strengths, rather than chasing the squeaky wheel
- They can prosper because their accounts receivable are accurate and timely
- They can have a handle on their cash position at all times and expected cash flow
Business owners are desperate to cut costs today. Not only do we fill that need, can we can help you add value to your company over time, and result in a higher sales price in the future.
Here's where we come in. Lets take our client, Sample Company, LLC, who made it through the first three years in business. Growth in sales has created the need for a more sophistication and efficiency in its financial reporting. In addition to wanting timely information to run the company, the CEO wants to make sure the vendors are paid the correct amount, there is enough cash coming in to pay those bills, and Sample Company's customers are paying the company on time. Sample Company has the following weekly tasks that we perform. We will show you what it costs Sample Company for us to do them each week.
Write 100 checks to vendors and mail them
record in correct vendor and expense account
Prepare 25 1 or 2 line customer invoices per week
to customers, record them and track their days outstanding
Record from 3 bank deposits with an average of 7
payment each (does not include making deposits) and
recording payment in customers accounts
(note: we do not open the mail and go to the bank)
Records weekly payroll prepared by payroll company
(does not include payroll preparation)
Monthly bank reconciliation for one cash account, balance
physical inventory (does not include counting inventory)
send 100 customer statements monthly
Weekly review and comments by CPA
TOTAL COST TO SAMPLE COMPANY
FOR OUR SERVICES (weekly) $ 495
Note: you pay for any checks or other supplies, and postage.
In addition, Sample Company only paid $250 for its Federal and 1 state income tax returns.
Total cost of program: ($ 495 per week +$250) $ 25,990 per year
Total cost of hiring bookkeeper 50,000 per year
SAVINGS OF OUR PROGRAM $ 24,010 PER YEAR
Here are examples of what we do for our clients. Each business is different and your needs may vary. We can;
Increase (and maybe double) your cash flow in as little as 180 days.
Do your weekly accounting tasks for you to free up time for you to focus on the growth and core issues of your business.
Show you what three key numbers are really important and how to run with a minimum of minutia. Add detail when it becomes important to maximize profits. Track up to 100 trends and key indicators that professional financial managers use to manage companies. Focus on the ones important to your business.
Show you how the financial pros use accounting “the language of business” to manage profitability and separate the facts from the guesswork.
Hire qualified support staff, and train them when your business becomes large and complex enough to warrant.
Establish strong financial controls in your business to reduce employee theft and increase profits.
Collect delinquent accounts and establish procedures to keep on time accounts paying timely. (Note: we have found over the years that simple dunning letters do not work)
Minimize sales taxes, reduce vendor payment by eliminating payment errors.
Prepare and monitor operating budgets.
Analyze profitability by service or product line.
Implement income, sales, payroll, and miscellaneous tax saving strategies.
Analyze financial trends in a business to help identify profitable areas and unprofitiable ones.
Assist in defining long-range plans and the quantification of goals.
Efficiently manage company cash.
Communicate and negotiate with bankers, attorneys, vendors, insurance agents, etc. to help obtain the best possible terms.
Assist in obtaining financing from banks, including assistance with negotiations.
Review and negotiate insurance policies.
Develop company accounting procedure manuals.
Analyze equipment purchases, expansions, etc.
Assist with mergers and acquisitions.
How do we do this? We wil visit your office one time to get a feel for the operation and to meet you and your employees that we will be working with. We will handle the setup with Intuit on their virtual Quickbooks or Quickbooks Enterprise servers. We will format any chart of accounts and input any customer and vendor information and balances and accounting beginning balances.
After your accounting system is set up, we begin to do the work. Each day simply scan and email or fax the source documents to our our Paperless Overnight system on our secure connection. Our accounting clerks will code and store the information in the secure area of the website, TJTCPA.COM. Your information is stored on our secure servers maintained by a professional web hosting company that serves the accounting industry. The data is transferred back and forth using the same high level codes and encryption as is used by banks and brokerage firms.
Then, our accountants will input your information into your accounting system maintained on Intuit's secure servers (Intuit is the large software company that writes Quickbooks and Turbotax). You will receive an up to date profit and loss statement, and the system generates the appropriate customer outputs, such as vendor checks or customer invoices and statements. The transfer to us, coding and retrieval, and input into your system will take approximately one business day.
Next, the work is reviewed by a senior accountant prior to submission to you. Note: if the work involves writing checks or issuing your customer invoices, then you or a member of your staff will be required to review the information. Any checks, etc, we keep for you will be stored securely at the West Metro Financial Center in Rochester. Original documents will be returned to you. During this time, we will make any adjustment to your books that are necessary, such as record depreciation or accrue expenses, or anything else that come to our attention.
Total time: You fax your source documents to our system by 3PM, you have your results by 10AM the second business day following. If we write checks, they will be overnighted to you or you can pick them up at our office.
The total time from beginning to finish will be three business days, at the end of which the vendors will be paid, customers will be invoiced, and you will know how much you are making, all from the information being coded and handled ONLY ONCE. Your company will be invoiced weekly, and can pay by check, Paypal, or ACH debit. All you do is bring in sales and make the deposits. We do the bookkeeping, implement the above profit making strategies and more, help add value to the business in preparation for a future sale, and help you take more cash out of the business now.
SEE EXAMPLES OF OUR WORK ON THE SUCCESS STORIES PAGE OF THIS WEBSITE
CALL NOW FOR A FREE CONSULTATION.
EXPERIENCE GAINED BY HELPING RUN 100 COMPANIES EACH DAY
CALL: (585) 424-2090
