Gabrielle M. Luoma, CPA, PLLC

Savvy business owners use a Certified Public Accountant to help with their taxes, knowing that training and experience can help to dramatically boost tax savings. But a good CPA is more than just a tax advisor—he or she is a business expert who can help with a range of financial and business development concerns. If you’re interested in learning more about the types of assistance a CPA can offer, consider these tips:

• Budgets and Business Planning: Whether you’ve just launched a new business or own an existing corporation, seeking the advice of an experienced CPA can be very helpful in establishing realistic budgets and benchmarks for your business. A strategic plan can make the difference between success and failure in today’s marketplace; a CPA can help you set business goals, establish checkpoints to measure progress, and take measures to encourage growth within your company.
• Assistance with Bonding: Bonding and taxes have different objectives, and a CPA can help you navigate the two areas to achieve the consistency that is favored by bonding agents, increasing your chances of a money-saving tax return.
• Profit and Cost Assessment: In order to understand and improve upon your current business structure, it’s necessary to monitor your systems and consider the costs and benefits of various types of work. A CPA can be helpful in analyzing the profits and costs of various contracts, products, and services you offer, and can give advice on which of these services are most lucrative and which are costing more labor and overhead than they’re worth. This kind of assessment can help you streamline your work to focus on your most productive areas.
• Internal Controls: These can encompass anything from elaborate checks and balances to discourage fraud, to a simple streamlining of your company’s paperwork to make you more efficient. A CPA with experience in your industry can advise you on the best internal controls for your business.
• Technology and Software Support: Your CPA can be an important resource in advising you on any changes you need to make to the technology or software you need to run your business. He or she can suggest software that can improve your financial outlook, and may be able to tell you about compatible technology in other areas.

A CPA is an invaluable team member for any business. Tap into their diverse range of skills to support your company’s growth, stability, and success.

2009 has been a year of serious contemplation by most business owners. I see this past year as a year of repositioning. Repositioning in business can mean different things to different people. Here are some different areas that businesses have been reviewing:

1.  Do you have the best clients?

Reevaluating your client list is probably the first thing to look at when planning your future year. Your marketing plan should focus on the best client fit for you. If the current client list does not fit your focus, think about whether or not you should keep particular clients. Follow the 80/20 rule in these matters. If 80% of your stress comes from 20% of a particular client then reevaluate whether keeping them is worth the trouble. You will need room for the new clients coming in 2010.

2. Are your products and services the best out there? If not, what should you do to improve?

Take a step back and ask a few of your valued customers. They are sure to be honest and will give you some insight into your business. Look at the services that produce the most return on their investment and focus on those. How do you know which products and services are doing the best? Financial analysis or reviewing your books for that information is the easiest and most efficient way.

3.  Are you losing time on different projects? Are we missing critical moments that are costing the company money and time?

Review current systems to see if there are inefficiencies. Flowchart them or put them on a piece of paper and then tear the system apart. Bring your team in to evaluate them with you. You never know what ideas will come out of this analysis that could save you thousands of dollars.

4.  Have you evaluated your strengths and weaknesses, opportunity and threats?

It’s called a SWOT analysis. This analysis can help you decide on which areas need to be focused on most. This should be done at least once a year.

5.  Are you totally lost at this point and feeling all alone? Do you have so many issues you don’t know where to begin?

You need a business coach to help you get through the hard stuff. Business or Executive Coaching is a great way to keep business owners motivated and moving. They keep you accountable for making progress and can give you tons of helpful hints, ideas and development opportunities.

In 2010, businesses that do the hard work now will definitely reap the benefits and will be more successful. Ultimately, you will have to ask a lot of questions of yourself and others before you can have a realistic view of the future. Your bookkeeping and financial records can answer the important ones that matter most. If you’re confused how they can help or don’t know where to begin, please give us a call. We can help.

Believe it or not, the New Year is just around the corner, leaving many business owners scrambling to create a business plan for 2010. A sound budget is one of the cornerstones of any enterprise, large or small, and taking the time to plan ahead makes all the difference in crafting a realistic plan that will help your business grow stronger and more profitable.

If you’re a small business owner tasked with budgeting your resources for next year, keep the following tips in mind:

• Budget conservatively: It can be difficult to accurately predict income or expenses, so err on the side of caution. Assume that costs will be higher than anticipated and that income may be lower, and then craft a budget tailored to those pessimistic figures. You’ll be prepared for the worst, and if business in 2010 is as good as (or better than) you hope, it will come as a happy surprise.
• Be flexible: A budget is a plan, but it’s never set in stone. You may need to adapt or even rewrite your budget after the first quarter or half of the year. It’s important to factor in safety margins on spending. Set aside some money in an emergency fund, and try to assess each unexpected cost on an individual basis.
• Consider projected cash flow: Cash flow is the focus of your budget, and can usually be broken down into three categories:
  • Projected sales: How much income you expect to see this year
  • Direct cost of sales: The cost of each sale in terms of shipping, customer service, materials, and/or labor in production.
  • Fixed costs or overhead: These are costs that exist regardless of your sales, ranging from administrative expenses to office supplies and utilities.
• Use last year’s numbers as a basis: Last year’s figures can provide a rough scale for your 2010 budget estimates. Don’t get too attached to them, however, since costs and sales can vary widely from year to year.
• Involve the right people: Depending on the size of your company, it may be necessary to create or request budgets from each department. Even if you’re creating only one budget for the entire business, ask essential team members to contribute their thoughts and expertise. Getting the advice of a CPA or other financial expert can also help make your budget more realistic and viable.
• Be realistic: As you consider the advice of your department heads and your CPA, as well as last year’s figures, do your best to be realistic. It might be nice to assume that sales will rise by 50% next year, but it’s prudent to assume that’s not going to happen. If the unexpected occurs, either good or bad, will your business be prepared to sell more product or spend a little more than you had anticipated? Plan for as many contingencies as possible and do your best to use all the expertise and information available to you.

No business owner looks forward to the chaos of tax season. When you’re already juggling customer service, marketing, and business development, it can seem virtually impossible to make time for preparing your financials. That’s where your CPA comes in.

If you think an accountant’s role is limited to preparing and filing annual tax returns, it’s time to adjust your expectations. Many of our new clients are pleasantly surprised to find out how much work we’re prepared to take off their plate.

One of the biggest mistakes business owners can make is withholding information from their CPAs. While basic financial data— W2 and 1099 forms, real estate interest statements, receipts for business expenses—is important, we dig deeper to ensure a clear understanding of our clients’ businesses and long-term goals. Below are some of the most important things to convey to your tax professional before tax season:

• Major life changes. These can apply to your personal or professional life. Examples of events to share with your accountant include the merger or sale of a business, the purchase of a new property, or an impending divorce or marriage. Any of these things can impact the distribution of your business profits.
• Projected income changes. Whether you anticipate fiscal challenges or you’re about to launch a revolutionary new product that promises to boost your revenue, it’s wise to let your accountant know what you’re expecting. Your CPA can help with any cash flow or re-investment concerns.
• Retirement goals. Do you have a timetable for when you’d like to retire? As a self-employed entrepreneur, are you unclear on the differences between a traditional IRA and a Roth IRA? Regardless of your age, it’s never too early—or too late—to discuss retirement options with your CPA.
• New projects or investments. If your business is venturing into new markets or about to start offering a new product or service, this change in direction could have an impact on your tax strategies.

As you approach tax season, a well-informed CPA is one of the most important business tools in your repertoire. The more your tax advisor knows about your current situation and long-term plans, the better he or she can help you achieve your personal and professional goals.

Think Again.

You wouldn’t set off on a cross-country journey without your GPS system—so why risk navigating the sometimes turbulent waters of business ownership without a qualified tax professional to guide you?

Considering the proven benefits of hiring a Certified Public Accountant, it’s surprising that a significant number of business owners don’t use one. What’s stopping them? Below are a few of the most common reasons we’ve heard, along with some facts to set the record straight.

Excuse #1: “I built my business from the ground up. Surely I can handle filing a tax return.”

While it’s true that the most basic tax returns can be completed with relative ease, a CPA’s services go well beyond filling out a few forms and sending them to the IRS. A good accountant will provide financial guidance throughout the entire year, not just during busy tax season. He or she will help you create a long-term strategy for growth and success, looking beyond the numbers to identify the unique challenges and goals of your business.

Some entrepreneurs and start-up business owners are used to doing everything themselves, and that “DIY” mentality can extend to their taxes. While it can be tempting to try and save some money by taking care of your own accounting needs, it’s important to understand that enlisting the services of a CPA doesn’t mean you’re incapable—to the contrary, it signifies that you care enough about your business to invest in its growth and dedicate more resources to essential areas.

Excuse #2: “I’ll just go online or buy a book to find all the tax information I need.”

Although there is extensive information available on the Internet and in tax books, no amount of singlehanded research can replace the benefits of a personal relationship with a CPA. When you meet with a tax professional, he or she will be able to get a clear picture of your goals and challenges, analyze the nuances of your situation, and make a customized recommendation. While knowledge and education are essential, they’re most effective when combined with a face-to-face consultation that’s driven by YOUR individual needs.

Excuse #3: “My business isn’t big enough to warrant a CPA.”

It’s a common misconception that only very large, lucrative businesses need a CPA. The truth is, companies of all sizes and profit margins can benefit from the services of a tax professional. An experienced CPA can help with all aspects of your business financials—tax returns, bookkeeping, payroll, financial analysis, in-depth reporting, and more. This will allow you to dedicate more resources to revenue-boosting activities, such as marketing strategies, product development, and client satisfaction.

Excuse #4: “I can’t afford to hire a CPA.”

Considering the significant tax and efficiency savings provided by a good CPA, a more accurate statement would be “I can’t afford NOT to hire a CPA.” With our reasonable rates and value-adding services, our professional tax services are a no-brainer investment in the success of your business.