As I was debating on this weeks blog post subject, I received a newsletter from the Career Center of a local college. Now I usually post information useful to the small business owner or relating to business management but thought this list was something that the new entrepreneur or someone considering becoming self employed may find insightful!
Many of the tips apply not only to employees but individuals and their overall work ethic and approach to their career path.
Kennedy’s CAREER STRATEGIST, Vol. XVII No. 8
THE TWELVE BEST PIECES OF CAREER ADVICE EVER
Membership and participation in your college alumni association and trade/professional associations should be life long.
Do not stay in a company when the death knell has clearly sounded.
- Fight obsolescence every day.
Make it your mission to become state-of-the-art on all technical skills important to your role.
- Maintain personal integrity.
Never compromise your principles.
You learn so much advising someone else.
- Learn to distinguish opportunities from exploitation.
- Seek advice from your critics.
You will never learn anything talking to people who agree with you.
Don’t avoid ambiguity or disorder. There is no growth without risk.
- Honor your preferred lifestyle.
Avoid anything that feels like a major sacrifice.
Greed is a career killer but so is selling yourself short.
- Consider self-employment.
As you notice, most of these not only apply to those working for organizations but owners of businesses too. Good solid advice regardless of your current position or job situation!
Considerations for Goals & Growth
In small business operations, it can be very difficult for a business owner to take time away from day-to-day and give attention to the bigger picture, especially areas of their business not directly related to daily operations. Marketing gurus and consultants advise owners to take time away from their business to think about the business!
Get away from the ringing phones and setup a place for your team to focus on planning and the status of your business. Give your team an opportunity to review annual reports including business objectives and goals established for the company. Welcome discussions about reasons goals have or have not been reached and what steps should be involved to address issues.
Take time to adjust and update your goals and map out how and when goals will be reached by the next meeting. Outline the ways to move forward after your meeting and create accountability for your managers, employees and especially owners!
Develop action plans that assign responsibility and time lines for any organizational or policy change. Action plans should be designed to clearly show step-by-step, how you will achieve the change or goals as well as your objectives for business growth. Action plans should include a start date, completion date and be assigned to a member of the team and resources required to complete the task.
Keep your business plans and goals easily accessible in a binder and add any performance tracking or notes as your business plans are updated and reviewed. Developing and meeting with your employees ensures everyone on your team is working towards the same goal and creates an environment of engaged employees empowered and committed to the success of the plan and the business!
Small business owners are more susceptible to theft, disaster, fraud, and internet crime and can suffer disproportionate losses relative to larger organizations because they lack the internal resources, expertise and systems to protect themselves adequately.
According to statistics and Certified Fraud Examiners Association, over a third of fraud and crime occurs in the smaller businesses. Per employee losses from fraud in the smallest businesses are 100 times greater than in larger organizations! An estimated one-third of business bankruptcies are due to employee theft and not having the systems in place to protect the business. Is your business currently protected from employee theft, internet crime, phishing scams and data loss?
There are practical ways to protect your business without paying for insurance or investing a significant amount of money. Many threats can be prevented with controls that cost nothing. Here are a few actions to take today to protect your assets and dramatically reduce risk.
Financial Controls: Owners should limit risk by having financial controls. Accounting controls and periodic audits should be in place to reduce their risk of theft. Outside audits and financial data review can stop and deter employee-theft!
- Control employee access, control purchase authorizations, conduct regular audits and initiate banking and automated controls. Using an outside bookkeeping firm such as MLB Business Solutions to conduct cash reviews, audits, fraud evaluations and reconciliations can dramatically reduce and deter employee theft.
Create Your Plan: Create a contingency plan for your business so you can recover in case of an emergency, the departure of key employees, the death of owner or other disaster.
Backup Data: Backup key data and store it in a separate location in case of disaster. Third-party storage, safe deposit box, owner home or even your car if necessary.
Electronic financials: Back up records digitally for your financial systems. Check images, transactions, statements and records
Lock-Up Your Assets: Loss of PC, mobile or memory device is a potential threat and source of computer crime. So secure your physical drives and data servers. Lock offices that hold these items.
Employee Controls & Training: Employee theft is the number one risk and costs more than $600 billion every year for businesses. Your employees are the main source of fraud – and the best solution to the problem. Establish division of labor, screen new employees and educate your employees about fraud and your organization’s policies.
For a free consultation on ways to prevent employee theft and fraud or to learn about the ways MLB Business Solutions can help your organization significantly reduce these risks visit www.MLBBusinessSolutions.com or contact us at info@melsaccounting.com.
Related Articles Available from MLB Business Solutions
Security Tips for Small Business, Small Business Internet Security Threats, Solutions to Prevent Employee Theft
Work “on” Your Business Not “for” Your Business
As an owner, your time is the scarcest asset in a business and if you are spending time in the bookkeeping and financial processes then you are essentially missing opportunities to be working on your core business services. The average business owner wears multiple hats and holds many jobs within their company but it’s time to evaluate how your time is spent. By investing a few minutes to evaluate and plan, you can potentially save hours of your precious time every week! A business owner should always be working on their core services or “on” their business not “for” their business.
Consider taking each department or element of your business and improving the processes – whether it be simplifying the sales process, automating the bookkeeping process, outsourcing the payroll process or even improving your collections process… every step that you take to streamline and develop your systems is beneficial to you, your employees and your clients!
Making the mistake of not “making time” to address these issues – can cost your company money! Learn how to think of your time as an asset not a free resource and allocate your time only in the most productive activities.
Below are a few steps to consider when evaluating your time and how it should be spent:
Step One: Know how your time is spent and understand what areas of your business you would like to remove yourself from entirely.
Step Two: Structure your time and put a “cost” to the different jobs in your company. Do you know the true cost of doing these jobs yourself? Fire yourself and outsource work as needed.
Step Three: Reallocate your time on activities that improve your business. As an owner your investment in time should be to the five highest ROI activities. (For example spending 10 hours working on the bookkeeping when it would take a trained professional a fraction of the time is a waste of time and resources and loss of potential revenue.
Step Four: List the time structure that is ideal and how you would ideally spend your time if you could.
Contact us today to learn more about ways to better manage your time and for a free copy of the “Time Management Worksheet.”
A question that I am asked time and time again from clients and business owners is what is the difference in a subcontractor and an employee? This can be one of the biggest areas of concerns when working with new clients and it can create an audit and IRS nightmare!
For the purpose of IRS guidelines and in general, an employee’s paycheck is subject federal and state taxes and is subject to employer FICA, state and federal unemployment taxes. An employee should be sent a W-2 form from your organization at year end.
A subcontractor receives payments from your company but no payroll taxes are withheld and will be sent a 1099MISC for at the end of the year.
How do you know if you should classify someone as an employee? An employee works for you and is told when, where, and how to work. Employees are usually scheduled to work at specific times and are subject to regulations regarding employment in your area.
Subcontractors can usually set their own hours, usually paid by the job or straight commission, and can complete the assigned job as they wish. They can hire additional assistants and generally are not covered by employee laws or insurance requirements. Subcontractors are responsible for reporting and paying any self employment taxes. They are generally considered “business owners” or sole proprietors that you contract jobs to.
If a business owner is paying an employee as a subcontractor and the IRS determines they are actually an employee, the business can be subjected to heft fines and penalties. The business can be held responsible for back tax withholdings and other fines in addition to becoming subject to investigations and audits. So keep off the IRS raider and ensure you are following IRS guidelines for all of your payments and disbursements to your workers.
If you are unsure how to classify a worker you should contact your legal advisor or contact our office!
Don’t “Set it and forget it” when it comes to your finances!
Recently I was discussing the benefits of using QuickBooks with a client. He discovered that his financial institution offered online banking features that integrated with QuickBooks Pro software. Many banks now offer various online bank services that allow QuickBooks users the ability to link directly with their financial institution and instantly download their checking account transactions into their QuickBooks files. The types of service can vary and may charge fees for these services.
Online services can be linked directly to your QuickBooks file and entered with one click of the mouse, while some just allow users to download a compatible file that must imported into the software manually. Both methods are faster than manually entering checks into your software but can create a disaster for the inexperienced QuickBooks user.
If you utilize any type of system integration or direct importing into your software, it is critical that your setup and account mapping are monitored until you are confident QuickBooks is coding the transactions correctly.
For example, when a transaction is imported or sent to QuickBooks software from your banking institution it is recognized as a check or a deposit but it must be coded to the appropriate account code from your Chart of Accounts.
For example let’s say your file imported a debit card purchase for Acme Restaurant: If you have no prior transactions for Acme Restaurant then QuickBooks will assign a code automatically. The default code is usually “Uncategorized Expense.” So if you never correct the mistake you could have hundreds of transactions coded as “Uncategorized Expense” instead of its correct account such as “meals or office supplies.”
Having an outside bookkeeper or ProAdvisor review and analyze your data is a great way to maintain the accuracy of your financials and help keep your business on track. Reviewing the financial reports in QuickBooks monthly is another way to discover any coding problems before they snowball out of control.
So before setting your accounting system on “autopilot” remember that every system no matter how automated or integrated should be reviewed and controls set in place to protect the integrity of your data and your business!
Preparing Your Business for April 15th!
Yes only a few short days ago, we celebrated the New Year, said “good riddance” to the previous year and April may be the last thing on your mind but let me be the one to remind you it will be here before you realize!
Each year clients swear “that next year will be different!” and that “I will never wait last minute to start” and each year my voice mail is full of clients asking how fast we can cleanup their accounting systems for tax time.
Are all your bank statements reconciled and your data entry complete? If not you can always contact MLB Business Solutions for a quick data review or QuickBooks tune-up. Below is a quick checklist that can guide you through closing your accounting period for the year.
- Statements :Make sure all of your checking accounts and credit card accounts are reconciled and all expenses have been entered.
- Customer: Review and update your client lists, contact information and balances
- Vendors: Review and update your vendor lists, contact information and balances
- Inventory: Verify your balances are updated and record any losses for the year
- Ensure all your sales tax, payroll taxes and withholding taxes are updated
- Verify your Balance sheet from the previous tax year and make sure no previous years data was changed by mistake
Would you like a FREE detailed checklist emailed to you? This list is a handy reference tool that can be used to cleanup your accounting system and prepare for tax season! The list includes 10 areas you consider reviewing with specific steps you should take to cleanup account lists, update balances, and cleanup your accounting data. If you would like me to email you a copy simply email me at mel@melsaccounting.com with the subject line “Period Cleanup Tasks” in the subject line.
Waste of Money or Smart Buy?
Anyone who has considered a business startup has probably come across the websites that promise the “All Inclusive Startup Guide” or “Complete Consulting Business in Box.” Some websites lure visitors to their websites by posting links with popular key words and then try to collect contact information or link visitors to useless sites.
If you are considering a business startup package or startup kit – you should first visit your local SCORE or SBA office and take advantage of free resources available to entrepreneurs. Information on business planning is available but can be very generic and finding a customized startup guide or Business Startup Kit may be something to consider.
Startup kits can be found for pet care businesses, consulting businesses and pretty much any industry that exists! These kits often include sample business forms in addition to planning information and can be a valuable resource in the business planning process!
My advice to those interested in starting a new business is to contact a professional or use a business planning service. But if you are starting with little or no cash flow my suggestion would be to take advantage of free resources and purchase a business planning kit or Guide that is as specific to your business as possible!
And of course you can visit www.MLBBusinessSolutions.com to view a list of the tools and resources that we have available, including sample templates and our Consulting Business Startup Guide.
Or some would argue the real question is What the heck is Twitter?
The marketing landscape has changed dramatically and businesses are making efforts to incorporate social media marketing into their current marketing plans. Business are faced with an overwhelming amount of options for beginning a social media marketing plan. I am often asked “Should I even bother with creating a social networking plan for my business? The answer is absolutely! To bring your organization into the new marketing era:
Determine what you want to accomplish by using social media.(Increase sales, drive website traffic, or increase brand awareness)
Identify your audience and who you are trying to reach as a company.
Develop your organizational message and what information you will provide to your prospective clients and your audience.
Choose one to three social networking sites to actively join. Remember it is more important to be active on a few sites than inactive on several sites. (Consider facebook.com, linkedin.com, twitter.com) Speak with collegues and professional contacts to determine the best site for your business profile.
Choose communication tools that can be used to create content that will encourage people to visit your networking profile and eventually link to your website. Tools include blogs that provide useful tips or articles, newsletters, or videos using websites like youtube.com.
These are simple steps to get you started and building a successful presence may take some time to develop but the benefits are real. Linking articles and newlestters to your website increases website traffic and gives potential customers the opportunity to begin a dialogue with your company. By engaging your audience and creating relationships you have the opportunity to increase brand awareness and your sales!
For more information or to learn how to develop a Social Media Marketing Plan, visit www.MLBBusinessSolutions.com
Many business owners incorporate their business to protect their personal assets and to create a separate corporate identity. Corporations and LLCs face requirements after their formations are complete and if overlooked could cause serious legal troubles. Visit your state requirements on the Secretary of State’s website or by contacting the Secretary of State’s office. States have different filing requirements and failure to follow these formalities puts you at risk of losing the corporate status and all the benefits that are included, such as protection to the shareholders.
Corporations are required to hold and document annual meetings of directors and annual meetings of shareholders. The minutes of these meetings must be documented on an annual basis and kept with your corporate records.
Business conducted at annual meeting of directors can include major corporate actions, financial changes of the corporation, officer salary and benefits packages or any additions to fringe benefits for employees. The annual meeting of shareholders meeting includes reports from directors and officers regarding the status of the corporation. Copies of documents pertaining to the discussed actions or any contracts should be attached to the Minutes.
By maintaining corporate records in minute books, people leave a trail of the decisions and the transactions of the corporation. Maintaining of the minute books record allows government or outside organizations to understand the decision-making processes of the corporation and is also an important record to have as backup for an IRS or state agency audit.
Are you in compliance?
It can be a very tedious task but taking time to update and review your corporate records each year should be a high priority!
Get started with sample forms and information on what should be included in your corporate record book. Visit the Tools & Resources Page at www.mlbbusinesssolutions.com and update your records with our easy to use templates and forms!
