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When we’re contacted by potential new clients and meet with them for our initial consultation, some of the questions we ask are:
- Who does your bookkeeping currently?
- Does your CPA send you back adjusting entries to enter in your accounting system after they are done reviewing/fixing your file?
- If they do send back adjusting entries, how many are there (or how many pages)?
The reason we ask these questions is it gives us good feedback on how competent the client is doing their own bookkeeping and if the CPA is looking after that client’s best interests.
Let’s start with the first point – whoever is doing the bookkeeping (in-house bookkeeper/officer manager, owner, or outsourced vendor) can objectively be evaluated simply on how much work the CPA has to do at the end of the year to fix the accounting records. If you’re only getting one or two entries back each year from the CPA (Depreciation is typically one of them), then we can assume the bookkeeper is doing a good job. If you’re getting dozens of entries (several pages) back each year, then we can logically assume your bookkeeper doesn’t really know what they’re doing. This situation is bad on two levels. The first is, now you know your books are messed up all year long and if you’re making business decision based on those books, well, you can finish that thought! It’s also bad because you’re not only paying your bookkeeper a salary/wage to do the work the first time, but now you’re paying additional money to your CPA (at a pretty good rate I imagine) to fix the work and do it a second time! A change probably needs to be made. The result will be that your CPA gets a clean set of books at year end and consequently your invoice from your CPA should be less. You also may get your tax return completed much sooner.
Now to the second point – evaluating the CPA relationship. It’s not uncommon for us to get a client file at year end and see that it’s a mess. Not only is the file a mess, but we can’t reconcile the trial balance to the tax return. We know they have a relationship with a CPA so we question why the file is so “out of whack” if the CPA is sending back adjusting journal entries after they’re done with the file. 9 times out of 10 they’ll tell us they never get entries back – they just send the file off every year and get their taxes done. (the one other time the client loses or forgets to post the entries) Now I can’t speak for every firm but that would make me question the integrity of that CPA. Why not send those entries back to the client so they’re running their business from a clean, accurate set of books? Are you keeping the file a mess because you know you’ll get more fees if you get to fix the file every year?? What about the feedback to the client – As the business owner, wouldn’t you want to know if your bookkeeper was doing a good job? Without that feedback, your bad bookkeeper goes undetected! That’s not client service.
Hopefully this helps you understand the year end process better and what you should be looking for as a tool to evaluate your current bookkeeping situation, as well as your CPA relationship. This will help hold everyone accountable.
According to a November 2014 survey, 255 out of 300 accountants said they have dismissed (i.e. fired) clients. Here are the top 4 reasons:
1. Late payment or nonpayment (72%)
2. Unpleasant to work with (54%)
3. Client wanted accountant to do something unethical (45%)
4. Late delivery/non-delivery of client docs, etc. (32%)
We’ve always stressed that for the client-accountant/advisor relationship to be successful, it takes commitment from both sides. Here’s a letter we send out to all new SBS clients:
“Maximizing Your SBS Experience” (more…)
I can’t tell you how many times we hear “Now is not the right time” from business owners and CEOs when we bring up the idea of CFO services. I honestly think it’s a conditioned response – kind of the way you respond when a telemarketer calls you at home. I can understand the initial wall that goes up. CFO services – what the heck is that anyway? Sounds expensive! What do I need a CFO for when I have an office manager and a CPA at my disposal? Is this how you would respond??
My question to you is “When is the right time?” When is the right time to:
• Better manage your inventory
• Review your pricing to maximize your margins
• Increase your profit
• Increase and manage your cash flow effectively
• Improve your processes
• Lower and manager your costs
You get my point?! Why settle for average when you can be excellent? Do you even know how good your business can be?
Most of the businesses that would benefit from CFO services typically already have an in-house bookkeeper or office manager and a CPA who they rely on for tax strategies and tax preparation at year end. That’s great – but those resources are not going to give you the benefits that a CFO can provide. Most bookkeepers and accountants are not nearly qualified enough to provide that sort of expertise, and most CPAs don’t have the time throughout the year to devote to your business. Many CPAs serving business owners have never owned a business and are limited in their knowledge of business operations.
The right time to bring in a part-time CFO is when you’re looking to improve the results of your business. Isn’t that every day of the year? I know I’m constantly trying to get better. Don’t get it stuck in your mind that a CFO is only another expense to deal with, but rather an investment in your business. Effective strategies, when executed, will bring a return that far exceeds the cost associated with our CFO services. I usually present it like this – wouldn’t you spend 10 dollars to get 30 back? Of course you would!!! It’s as basic as that! Don’t SETTLE for the status quo. Spend more time focusing on the financial metrics and performance of your business. Your CPA is there only when you call him/her – there to react to what’s already been done. A Steiner CFO consultant is there in your business throughout the month working proactively and coming up with strategies that can be executed throughout the year and provide tangible results that can be duplicated for years to come. Don’t let your fears of the unknown stop you from taking the next step. The next step is to call or email us to find out more about our CFO services!
Register on our website now to get great QuickBooks tips to help you maximize your QuickBooks experience! Join Doug Wootten as he goes over some of the best tips he’s found to help people navigate around QuickBooks. Doug will also cover all the different training options that Steiner Business Solutions has to offer. Doug is an Intuit Certified Pro Advisor.
Sample topics Doug will cover:
-Did you know there is an Open Window list that lets you quickly switch between multiple open reports and screens?
-Did you know you can quickly Edit multiple names on lists such as Items, Vendors and Customers all from one screen?
-Do you know the difference between writing a check and making a bill payment?
-Do you know the difference between receiving a payment and making a deposit?
-Do you know how to memorize reports for easy access at a later time?
Steiner Business Solutions is proud to announce it has added Larry Sugar to its growing team of CFO consultants focused on providing high level financial guidance and strategy execution to small and mid size businesses. Steiner Business Solutions has created an entire new CFO Services division alongside its core business of accounting and tax preparation services to focus on this greatly under served market.
Larry is a senior financial executive with 35 years of operations and management experience in accounting, tax, bank relations, data processing, SEC reporting, budgeting, and planning. He has a successful track record in acquisitions, public offerings, debt restructuring, and cost reduction programs. He has successfully blended his financial acumen acquired as a CFO, controller and assistant treasurer with various public corporations with the entrepreneurial experience of a small business owner. Larry holds an MBA – Finance from Cornell University and is a CPA.
Please contact Larry directly at firstname.lastname@example.org if you are interested in our CFO Services. He would be happy to provide you a customized CFO Analysis Report.
As Steiner Business Solutions continues to grow and add new services, we have decided to add a new member to our team. We’re excited to announce that Mary Weidner has been brought in to be our Director of Business Development!
Mary brings 18 years of sales, marketing and business development experience across many industries. She will focus on delivering our unique value proposition to the Richmond, VA business community as well as introduce business owners to our awesome new service offering – On Call CFO Services. Mary understands the challenges that owners and CEOs face and passionately believes Steiner Business Solution is the right choice to provide the guidance and financial strategies to handle those challenges.
You can contact Mary directly at email@example.com if you are interested in learning more about Steiner Business Solutions and what we can offer your business.