Whether you are starting a business or you are established, one rule of thumb applies to everyone: Little expenses add up to becoming big expenses. That includes the invoice from your accountant. Our Efficiency Equation allows you to help reduce the cost and improve the quality of your accounting.
Traditionally, accounting services would include organizing your receipts and files, and simple typing from your software to their firm’s software. Those tasks can be time consuming, adding to your bill. This can distract tax professionals from identifying business and tax opportunities and takes accountants away from the practice of accounting. This additional busy work can affect overall quality of your service, potentially missing business and tax opportunities. This additional busy work can affect overall quality of your service, potentially missing business and tax opportunities.
We believe that preparation is a primary step to efficiency and cost effectiveness. Whether you are technically savvy or you barely use a computer, we have a simple process you may follow that will help reduce your bill and help to ensure the highest quality even before we start.
What can businesses do about this? Here is our approach to efficiently work with you:
If you’re a "no-technology" business owner:
- Make sure you get clear copies of all bank and credit card statements.
- Some bank statement’s periods end on a date other than the last day of the month. If this is the case for your bank statements, be sure to include the statement that ends in the January of the tax year. Also include the statements for January (preferably up to March) of the year after the tax year so your accountant can properly reconcile your bank accounts.
- Credit card statement periods almost always end on a date other than the last day of the month. As such, be sure to include the statement that ends in the January of the tax year AND January of the next year.
- Try to move onto category 2, the “low-tech” person.
If you’re a low technology business owner:
- In addition to PDF/paper bank statements, obtain a download of the year’s bank activity in a CSV or Excel format through your bank’s website.
- Also download a Quickbooks format file for the year if you haven’t kept records through the year.
- Although these suggestions use your computer, banks have made it much easier to download activity.
If you’re a "technically savvy" business owner:
- Keep on top of your accounting through the year. Many, if not most tax saving opportunities, are lost after year end. The so called “11 month analysis” in December can pay big dividends in acting upon time sensitive tax saving opportunities.
- Reconciling your bank accounts periodically throughout the year can actually save you time at year end. You may be looking for 1-2 errors per month as opposed to 12-24 errors at year end. The information will also be fresher in your mind.
- Learn QuickBooks or use a qualified bookkeeping service that regularly serves small businesses.
- If you do not have inventory or complex customer billing, consider using the “Bank Feeds” function in QuickBooks. That allows you to download your bank activity directly into QuickBooks.
- QuickBooks for Mac is not compatible with your accountant’s QuickBooks and the features and functionality are not current. We recommend you do not buy it. If you use it now, we recommend switching to QuickBooks Online.
- Quicken is built for personal use, not businesses. As such, I absolutely do not recommend it for business. It is simple to move a Quicken file over to QuickBooks. Find out how by contacting us now.
Develop a concrete plan with your accountant to your mutual benefit.
- Ask what specific information you can provide in advance of tax season that will enable your accountant to optimize your tax and business opportunities.
- What formats does your accountant prefer to receive in order to minimize data entry, converting that to value added time.
- Ask your accountant how his systems integrate, or can integrate, with your systems. Does your accountant access your QuickBooks Online? Does your accountant have the Accountant’s version of QuickBooks Online or Desktop (this enables the accountant to review and correct errors much faster than a standard QuickBooks)?
- Ask your accountant what manual processes he performs that could possibly be automated.
Contact us for more information and to speak with an experienced CPA.