Are you managing your employees efficiently?

Are you managing your employees efficiently?

Is having employees leaving a dent on your profits? It is time to look into your accounting to evaluate performance.

There are two popular business expenses that greatly affect revenue; payroll and inventory. Keeping adequate control of both expenses will keep your profits in good shape.

The following are steps to consider when managing your employees:

Corporate Organizational Chart. Small businesses should take for example these types of structures even if your business is not a large corporation with a tall flashy building. These charts work well with any small business with employees in order to better structure job duties, responsibilities and identify unnecessary positions.

 

This structuring is done to help establish policies, rules and ways of working. It also helps in reaching business objectives by maximizing workflow. Without this chart, employees will basically be all over the place and consequently will cause the whole workforce to be slow, causing an unnecessary economic leak.  Organizational structure improves efficiency by providing clarity to employee regarding their duties, responsibilities and reporting to the right superior.

Think Outsource. Depending on the type of business you have, sometimes it will be more cost effective to hire an independent company to deliver a specialized service at an affordable rate as an alternative to having an employee with a full salary. For example, you can outsource your accounting to a local firm and meet with your accountant monthly or quarterly to discuss your finances. If you’re a healthcare practitioner you can outsource your billing to local or online companies specializing in billing and coding. Before taking such action be sure that this won’t negatively affect your quality of service or product for your clients or business objectives.

Minimize Overtime Costs. By having an organizational structure in place along with a time and schedule system, businesses could save a lot of money by avoiding paying overtime. According to the Fair Labor Standard Act (FLSA ) the overtime pay rate for eligible employees is one and one-half (1.5) times their regular working hour rate of pay. A time and schedule system is an effective way organizing employees.

There are more methods available to improve employee efficiency however, I am not a specialist in human resources but I do recommend hiring a consulting HR firm that can help structure your company to improve efficiency and save money.

If you need assistance with your business finances or taxes feel free in contacting us at Business Solution Center | Eeliffee@bsctexas.net | 956-466-4503 in Brownsville Texas.

Post by Eeliffee Garcia

5 things to consider before doing your own accounting.

5 things to consider before doing your own accounting.

Using an accounting software does not replace the accountant.

Small businesses owners, especially those that have just started their business think that software is all they need to manage their financials correctly.  Why even bother hiring an accountant or bookkeeper when you can save money, right?

Then one day you receive a letter from the IRS requesting for your balance sheet information such as asset depreciation, owner’s draw, or perhaps they want to inquire about a tax deduction you took as “political contributions”. Yep, have fun with that.

Things to consider before doing your own accounting:

1. Expenses. Not everything is a business expense. Your loan repayments for auto, business mortgage or credit card payments are not business expenses and should not be registered the same way you would register inventory or office supplies. Loan repayments, along with personal expenses are recorded on the balance sheet.

2. Balance sheet. What in the world is a balance sheet? This is the place where you register everything your business OWNS and everything your business OWES  (bills, loans, taxes, etc), plus personal expenses and personal withdraws you make from your business account. This information is used to complete a business tax return, and or by bankers when you need a loan.

3. Sales Tax. Paying sales taxes is not an expense because you are basically “collecting” sales taxes from the consumer (your customers or clients) and turning it over to the government. Sales tax is NOT a tax on your sales!

4. Tax Planning. Your accounting software will not give you tax advise based on your current financial circumstances. What if you’re a sole proprietor and you need to convert to an S-Corporation in order to save taxes? Or perhaps you need to pay someone and you need to decide between a w-2 employee versus an independent contractor.  Having the input of an accountant is never a bad idea.

5. Owner’s equity. Is the money you put IN and the money you take OUT of your business. Keeping track of both things will help calculate your “net worth”. It’s important to keep track of these figures for banking and tax purposes.

So, are you ready to take on your own accounting? Consider hiring an accountant that is willing to train you to use your accounting software and you can do most of your accounting. For the tricky and most technical transactions you can have your accountant step in plus review the rest of your work. This is an affordable way of keeping your accounting records secure. Check out our previous 5 tips on hiring an accounting professional.

 

If you need assistance with your business finances or taxes feel free in contacting us at Business Solution Center | Eeliffee@bsctexas.net | 956-466-4503 in Brownsville Texas.

Do you have income protection in case of an accident?

Do you have income protection in case of an accident?

Post by Eeliffee Garcia

Have you ever wondered what would happen if one day you have an accident and can’t go to work and collect salary for a short period? What if you have family that depends on you? Having income protection can be a very valuable option. 

For the sake of simplicity let’s call this subject “income protection” in case of a temporary disability. Just like anything else in life, the things we value the most and the things that we NEED the most sometime require some type of insurance. There is auto insurance in case of an accident, mortgage insurance, and home insurance. All those insurances are very important in case the inevitable was to happen. The same thing applies to this situation. There is disability insurance that can help alleviate the lack of income in case of a temporary disability. There are several options and features that these type of insurance carry. For example, you have short term or long term and you choose one or both depending on your needs.

With a disability insurance policy you are guaranteed that you will get monthly insurance payments (after meeting certain requirements and time) to cover for the loss of wages/salary due to an injury that has temporarily disabled you. These monthly payments will be based on your current income to cover your monthly cost of living.

If you are self-employed and have employees along with other monthly expenses then it is crucial that your business have a backup plan in case you can’t attend to your business as the key person that generates most of the profits. If as a business owner you purchase disability insurance you can also add the option of insuring your business overhead costs. You and your company will both be temporarily insured in case something was to happen to you.

I enjoy sharing valuable information, however I am not an insurance adviser, but as an accounting professional I coordinate with insurance advisors to assist my clients in obtaining financial security in case something was to go wrong. If you are interested in learning more about disability insurance I recommend researching your local insurance companies that handle these type of insurances and speak with an agent.

If you need assistance with your business finances or taxes feel free in contacting us at Business Solution Center | Eeliffee@bsctexas.net | 956-466-4503 in Brownsville Texas.

2017 National Tax Conference – Washington D.C.

2017 National Tax Conference – Washington D.C.

Post by: Eeliffee Garcia

I recently attended a national tax conference with the National Association of Tax Professionals in Washington D.C. NATP is the largest nonprofit organization, with members in all 50 states, focusing specifically on federal tax preparation. NATP is an IRS Tax Pro Association Partner.

This conference was a 4-day event with 16 sessions on specific tax matters from auditing techniques, retirement planning to IRS debt negotiation. These sessions are taught by top industry leaders that include practicing CPAs, Enrolled Agents, Certified Financial Planners and attorneys. All attendees enjoyed the presence of the IRS commissioner John Koskinen who allowed us to ask any question we had in relation to procedures, grievance or concerns we may have as tax professionals in representation of our clients.

Identity theft and internet crime is a big thing, and cyber-security was part of one of the sessions I took with Larry Gray CPA. For the session, he brought an IRS Criminal Investigation agent as special guest to discuss the importance of safeguarding our clients’ data. Larry provided us with a manual to tweak and follow. How secure is your personal data? Ask your current tax professional about data security and what methods is he/she using.

Recently I was nominated to serve with the board of directors of the NATP – Texas Chapter and it was an honor being able to represent my state in Washington D.C. If you’re a tax professional and would like to be a member of this great organization please leave me your contact information so that I can forward you more the details.

Texas board member plate

This was a great learning experience that has enriched me as a tax professional to grow and better serve my clients with the quality of service they deserve. Until next time.

DOWNLOAD the national conference brochure if you want to have an idea what the conference is like.

 

If you need assistance with your business finances or taxes feel free in contacting us at Business Solution Center | Eeliffee@bsctexas.net | 956-466-4503 in Brownsville Texas.