Implementing a new accounting system is no small feat. It requires careful planning, coordination, and commitment from every team member. We’re always excited to help a business with a new accounting infrastructure implementation because we know the positive impact it can have on a business. 

We also understand that, as a business owner, transitioning to a new software solution can be both exciting and daunting. You’re taking a giant leap in a positive direction to increase your efficiency, enhance the functionality of your accounting system, and optimize your processes.

But great reward doesn’t come without some risk: you’ve likely already considered employee learning curves, potential technical challenges during the transition period, and how a new implementation could disrupt daily operations. These concerns are valid, and with the right expectations, the journey can be smoother and more rewarding for everyone involved.

Hard Work Ahead: Embracing the Challenge

Let’s be honest: implementing a new accounting system isn’t a walk in the park. It requires time, effort, and resources to ensure a successful transition. From data migration to process reengineering, numerous tasks need to be completed with precision and attention to detail. It’s a journey that will test the resilience and determination of the entire team. 

Rowing in the Same Direction: Unity in Purpose

Implementing a new accounting system requires a collective effort from your entire team. Everyone on board must be rowing in the same direction; if you notice team members resisting the change, it’s best to address the issue head-on. Ultimately, the goal is not to make their jobs harder; it’s to improve their workflows and processes in the future by putting in the hard work now. And for your implementation to be as successful and pain-free as possible, every team member must be ready to embrace change, adapt to new processes, and support one another throughout the transition. With a company culture of collaboration and communication, we can overcome any challenges that come our way while implementing your new accounting infrastructure.

Charting the Course: Milestones and Deadlines

Like any major project, implementing a new accounting system involves setting milestones and deadlines to keep the team on track. These milestones serve as checkpoints to assess progress and make necessary adjustments along the way. Whether we’re completing data migration or conducting one-on-one training with your team, each milestone brings us one step closer to our ultimate goal: to give you a beautiful accounting infrastructure that meets your current business needs and still leaves room for growth.

Bringing It All Together: The “Go Live” Date

The “go live” date is the culmination of your months of hard work and preparation. It’s the moment when the new accounting system officially replaces the old one, and all systems are a go! Reaching this milestone involves coordinating a multitude of moving parts, from finalizing configurations to conducting system testing. Everyone needs to be aligned and working together towards this common goal.

Embracing Differences

Transitioning to a new accounting system inevitably brings about comparisons between the old and the new. From software functionalities to workflow processes, there will be changes that require adjustment and adaptation. It’s important to acknowledge these differences and approach them with an open mind and a willingness to learn. We wouldn’t be guiding you through an implementation if we didn’t already understand your business’s unique needs and believe we were charting the best path forward for you. With the right mindset, we can turn the differences between your former and future accounting systems into opportunities for growth and improvement.

Implementing a new accounting system is a significant undertaking that requires dedication, perseverance, and teamwork. By setting clear expectations and rallying the team around a common goal, we can confidently navigate this journey and achieve success. You can learn more about our implementation services here.

As a business coach and advisor, I’ve witnessed firsthand the transformative effects of company-sponsored team retreats. While retreats may conjure images of luxurious vacations, they are far more than just an opportunity for relaxation on the company dime. When strategically planned, a winter retreat to a warm weather climate–or a summer retreat to a more temperate environment–can be a powerful tool for fostering team cohesion, enhancing communication, and strengthening relationships among co-workers. 

Let’s explore a few best practices for creating an impactful retreat, including a well-balanced itinerary, programming that aligns with your goals, and how to craft a retreat that ultimately benefits your organization and employees.

Striking the right balance: How to create a company retreat itinerary that prioritizes both work and play.

One of the most common misconceptions about team retreats is that they are solely about leisure and relaxation. While downtime and recreational activities do play a crucial role in fostering camaraderie, a successful retreat should also include structured work sessions aimed at achieving specific goals and objectives.

To craft a productive and meaningful agenda for your retreat, start by building out a timeline of the trip, accounting for structured planning sessions, meals, team-building activities, team leisure, one-on-one time, and independent time. 

Once you have the framework for your retreat, it’s time to start planning your structured projects.

How to develop an agenda that aligns your team retreat with your company’s goals.

Integrating structured projects into the retreat agenda ensures that the time spent away from the office sets you up for success when you return. Depending on the objectives of the retreat and your team’s needs, these projects can range from brainstorming sessions to professional development, skill-building workshops, and strategic planning exercises.

For example, teams may collaborate on developing innovative solutions to current challenges, refining company values and goals, or enhancing communication and teamwork skills through interactive workshops. Retreats can also be a good time to address more serious topics, like disaster management and business continuity. By aligning the work with the retreat’s overarching goals, employees can benefit from a sense of purpose and accomplishment, and the company can benefit from a clear path forward and an engaged, satisfied team.

Meet with your team a few weeks before the trip to discuss the proposed itinerary, their perceptions of the company’s and team’s needs, and the results you’d like to achieve during the retreat.

A retreat is an investment in the health of your organization.

A company-sponsored employee retreat is not just a vacation. It is an investment in your team’s well-being and professional development. It is an opportunity to step away from the day-to-day grind, gain fresh perspectives, and strengthen bonds with colleagues in a relaxed and inspiring setting.

However, striking the right balance between work and play is essential. While recreational activities are important for promoting relaxation and socialization, they should complement, not overshadow, the work component of the retreat. By carefully curating the agenda to include a mix of structured projects and leisure activities, you can create a retreat experience that is as impactful as it is enjoyable.

A company retreat to an enjoyable climate offers a unique opportunity for team-building and relationship-building among co-workers. By combining structured work sessions with recreational activities, companies can foster a sense of camaraderie, boost morale, and enhance productivity. So, embrace the sun and consider investing in a company-sponsored retreat for your team!

Remember, it’s not just about the destination—it’s about the journey and the connections forged along the way.

Time is a precious, valuable, and finite resource. We all have only twenty-four hours in a day and only seven days in a week to get everything done. And for entrepreneurs, that can often seem like barely enough.

So, why does it seem like some of us can get more done in a day than others? The answer could lie in a few possibilities:

• Are you doing what’s important or simply what seems to be the most urgent at the moment? 
• Are you wasting time on tasks that should be delegated, automated, or ignored completely? 
• Have you ever considered tracking what you spend your time on?
  

I was curious about how I really used my time, so I tracked my time and activities for one week. I uncovered valuable information regarding inefficiencies in my world and have been able to take steps to eliminate, automate, and delegate better. I encourage you to do the same, and this article should help you get a good start on reclaiming your time and working more productively.

Day 1: Establish the Habit of Time Tracking

1. Begin your day by setting up a simple time-tracking system.  Whether you prefer digital tools or the classic pen and paper, make a note of every task and its duration.
2. Be honest about where you’re spending your time. This is a judgment-free zone, and having more accurate information here will only benefit you in the long run.
3.  Reflect on what’s driving your activities:

• • Are you stuck in an endless loop of emails?
  • Are you using your inbox as a to-do list?
  • Are you wasting time on technology issues?
  • Are you answering the same questions over and over from team members or customers?

Day 2-6: Document Your Activity, Reflect on Your Data, and Adjust Your Habits Accordingly

• Log your activities throughout each day, including breaks and interruptions.
• At the end of each day, reflect on the activities you tracked. What surprises you? What patterns emerge?
• Identify tasks that took longer than expected or seemed unproductive.

Day 7: Analyze Your Data and Strategize Improvements

1. Compile your week’s data. Look for trends, time wasters, and areas (or times of day) where you were most productive.
2. Categorize these activities into groups:

• •  Critical tasks – those that only you can do
  • Enjoyable tasks – Those that you really like to do
  • Delegate-able tasks – Things that you could outsource or delegate to your team
  • Automatable tasks – recurring activities that could be completed more efficiently with technology
  • Useless tasks – activities with minimal impact that could be eliminated; you’re only doing them because you’ve always done them, and practice makes permanent

Next steps: Delegate and Automate

1. Pinpoint tasks that could be delegated to your capable team members, or outsourced to a vendor. Empower your team members, entrust them with responsibilities, and create standard operating procedures on how these tasks should be done to your specifications. Even if it feels like training your team will only make the process take longer, in the long-term, delegating tasks to your team will free up your time for strategic decision-making activities.
2. Research opportunities to automate repetitive tasks and leverage technology to save time and reduce errors.
3. Be open to the possibility that certain tasks may not be adding significant value and consider eliminating or outsourcing them to focus on what activities will have the greatest impact on your business.

Starting 2024 off on the right foot

This exercise may seem simple but its impact can be profound. Its purpose goes beyond increasing efficiency – it’s about creating a business that thrives on your unique strengths. 

By gaining insight into how you allocate your time, you’ll be able to identify areas for improvement, empower your team to take on more responsibility, and free up valuable time for more rewarding and impactful activities.

Time is your most valuable asset, and by mastering the art of effective time management, you can unlock doors to unparalleled productivity and success. I look forward to hearing about your time-tracking experience and findings in our next coaching session.

Regards,
Rhonda Rosand, CPA
CEO, New Business Directions

Cloud Hosting: It’s Time to Break Up with Your In-House Servers.

Gone are the days of dial-up internet and cell phones with buttons for every letter of the alphabet. Neither dial-up nor the Blackberry makes sense in 2023, and frankly, neither does the in-house server. The current era of business demands that your data and software be readily accessible; cloud hosting is the best way to accomplish this. 

Cloud hosting is the process of storing your software and data somewhere other than the box under your desk that’s collecting dust.

It requires no more installs, re-installs, updates, or worries about backups. It allows you to work from anywhere, at any time, collaborate effortlessly with your team and professional service providers, and scale your operations –without the IT headaches. 

The cloud is safe and secure with built-in redundancies, managed IT (think firewalls and virus protection), and is part of a comprehensive disaster management plan, allowing you to eliminate the responsibility of managing it yourself while increasing the accessibility of your software and data.

Anything can happen in business — your server can crash, your office can flood, your back-up could be corrupted. Your financial data is the lifeblood of your business, and safeguarding it with modern technology like cloud hosting is essential.

I’ll never forget my first tax season at a local CPA firm, one customer meeting in particular. We were sitting across the table from a nice young couple expecting their first child. They had started a small construction company that year and did quite well. The purpose of our meeting was to deliver the tax return, tell them the balance due for taxes, and answer any questions they might have about the Federal and state tax returns and future estimated tax payments.

When I shared with them that they owed just shy of $10,000 in income taxes, the young lady burst out in tears! They didn’t have the money. They had profits–but no cash. No one had ever explained the difference to them, and they were not expecting a balance due of that magnitude.

This meeting changed their lives and the course of my career. I never again wanted to sit across the table to deliver unexpected news to a bright-eyed entrepreneur and his expecting wife.

Therein began my career of teaching small business owners the difference between profits and cash, along with many other nuances of business ownership that no one ever tells you (including the fact that approximately 40% of your profits will go to pay income taxes). It’s a harsh reality, and knowledge is power. These outflows of cash can be planned when you have advanced notice. This type of planning is usually called tax planning, business planning, revenue planning, and/or profit planning. But knowing the difference between profit and cash is a good place to start — let’s dive in.

Here is the short and sweet on the difference between profits and cash. Profit is revenue minus expenses. Cash is money in minus money out. There is a fancy, seldom understood financial report called a Statement of Cash Flows that reconciles your profit to your cash, and is part of a comprehensive financial statement package which will also include your Balance Sheet and Profit and Loss Statements.

Most small business owners only look at the profit and loss, pay little (if any) attention to the balance sheet, and have never heard of the Statement of Cash Flows.
However, I would argue that the Statement of Cash Flows is the single most important financial report. It will tell you how much profit you made, where the money went, and what’s left of your profit.

There are certain things that you spend money on that are not tax deductible: some are not deductible at all, and some not immediately. They use cash, deplete your bank account, and do not reduce profits.

 Let’s discuss a few common examples:

Equipment – you buy a new piece of equipment for your business. This might look like a walk-in cooler for a restaurant, a forklift for a warehouse, a work van for a construction company, a new stitcher for a manufacturing facility, or a company truck for the business owner. These items are Assets with a useful life extending beyond a one-year operating cycle and are reported on the balance sheet. They affect cash and do not affect profit until they are depreciated. When you make an investment in a piece of equipment like this, it is not immediately deductible. You’re out the cash and do not have an expense deduction–yet.

Loan Payments – Let’s say you buy that forklift and take a loan for it because the interest rate is better than what you’re making on your savings, or you don’t actually have the cash to pay for it outright. While the interest paid on the loan will be tax deductible, the loan payments themselves are not. The principal portion of the loan payment reduces the loan Liability account on the balance sheet. It affects cash, but never profits.

It is important to reconcile profits to cash, to find out where the money came from and where the money went. You never want to be caught short at the end of the year without enough cash to pay the taxes on the profits generated by your business. And hey, those federal income taxes you pay? Those are not tax deductible either.

While New Business Directions doesn’t prepare tax returns, our clients can benefit from the types of planning we mentioned above. Having a CPA in your corner throughout the year can make or break you at tax time–we can consult with you on the best time to make a capital expenditure decision, keep you informed about the speed at which cash is entering and leaving your business, and more. If you’d like to discuss cash vs. profit within your company, complete our intake form to get started.

When building a team, classifying your workforce correctly is vital to your business’s success and legal compliance. Employees and independent contractors are not interchangeable terms, and it’s important that you can distinguish between the two in your organization.

While it may seem like a simple solution to classify members of your workforce as independent contractors, there are actually very specific criteria that determine whether a worker can be classified as an independent contractor. Workforce classification is not a grey area – the IRS has an independent contractor test, as do many states, and they do not always follow the same criteria. In this article, we’ll discuss the differences between an employee and an independent contractor so you can ensure you’re operating your business correctly.

When is a worker considered an Employee?

Employees work under your direct control – they follow your schedule, use your company tools, and often receive benefits such as training, healthcare and/or retirement. You withhold taxes from their paychecks and contribute your share of payroll and unemployment taxes, you pay workers’ compensation insurance on the wages, and you file quarterly and annual returns with the IRS, Social Security Administration, and state agencies.

When is a worker considered an Independent Contractor?

Independent contractors maintain autonomy – they work for themselves and have their own company, they set their own schedule, they provide their own tools, they have their own general and/or professional liability insurance, and they handle their own income and/or self-employment taxes and pay their own expenses. They are typically hired for a specific project and under contract and take the risk of whether or not they make a profit.

What can happen if a worker is misclassified as an Independent Contractor?

If the IRS determines that you have been misclassifying an employee as an independent contractor, the penalty can equal 20% of the wages paid; 100% of the employee FICA taxes that should have been withheld; 100% of the employer FICA taxes that should have been paid; 20-75% of the underpayment of taxes; 25% of the late payment of taxes; and a per-worker fine.

In addition, there are Department of Labor and state penalties for misclassifying employees as contractors, which can equal any overtime that should have been paid. Plus, courts can award an additional 100% of unpaid overtime payments.

Penalties can also include severe criminal sanctions, including felony charges.

There’s a lot at stake when it comes to classifying your workforce correctly, and cutting corners here can be a costly decision for your business. Proper classification safeguards your company from legal issues and ensures compliance with labor laws, workers’ compensation laws, and Federal and state laws. If you have questions about the classification of your workforce or need support with payroll in your business, reach out to our team at newbusinessdirections.com/contact.

Running a business can feel like a whirlwind of responsibilities! Time is a precious resource for entrepreneurs, and taking shortcuts can be tempting. However, there’s one shortcut we really recommend against: sharing sensitive documents like bank statements, financial reports, tax forms, and more over email.

When safeguarding your valuable information (and that of your customers!), prioritizing security is essential. With cyber threats constantly evolving, email is an increasingly vulnerable method for transmitting confidential data. How should you be sharing your sensitive documents instead? By embracing secure document-sharing portals.

Document-sharing portals like SmartVault employ state-of-the-art encryption techniques to prevent bad actors from accessing your information. They can streamline your workflows, save time, and reduce errors. Most have user-friendly, intuitive interfaces, too, making it easy for you and your team to implement the new tech successfully.

Portals don’t just benefit you and your business, however! They can benefit your customer relationships, too. Adopting a portal can demonstrate a commitment to protecting your customers’ data, safeguard your reputation, and help you comply with data protection regulations.

While attaching a file to an email may feel more convenient in the moment, the tradeoff could be catastrophic. Instead, by taking an extra step to secure your documents, you’re investing in the long-term success of your business. We, as accountants, cannot overstate the importance of robust data security, and we encourage you to embrace the convenience and peace of mind that secure document-sharing portals provide!

The IRS announced earlier this month that it has increased the optional #StandardMileageRate used to calculate the deductible costs of operating a vehicle for business. The new rate, effective January 1, 2023, will be 65.5 cents per mile driven, which is an increase of 3 cents from the unusual mid-year increase we saw in 2022.

For full information, including deductible amounts for miles driven in service of charitable organizations, medical, or moving purposes for members of the armed forces, read the full article from Journal of Accountancy linked here: https://www.journalofaccountancy.com/news/2023/jan/business-standard-mileage-rate-increases-2023.html