Accounting, Advisory, Bookkeeping and Tax Services for Small Businesses | Located in Woodhaven, MI. Serving Downriver and Metro Detroit

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Compliance:

Compliance to tax laws, regulations and rules vary by the type of business and industry in which they operate.

Instead of looking at compliance as a necessary, but non-value added activity for small businesses, we view good, historical, financial data as an indicator as to what can be expected in the future, in the absence of structural changes to the business. When a business achieves baseline compliance, it means that there is reasonable assurance that (potential) threats imposed by external authorities can be addressed and overcome.

But, additionally, having solid financial data forms the basis to make sound decisions concerning future growth or other financial goals of the business.

You can’t effectively run your business if you’re continually chased by taxing or other authorities for information or evidence of compliance. If you do get challenged, you need to resolve these issues, quickly. It’s a hell of a lot easier to resolve tax (or other accounting or financial) challenges with well-structured, organized, classified and reconciled data, records and transactions.

Business Advisory Services:

Advice needs to be grounded in data and facts. The rule should start with, “first, do no harm.” We take the view that any business’s operation, activities and processes should be looked at to improve the time it takes to start, create/manufacture, complete and deliver products and services, with no loss in quality or service. The velocity of this start and delivery cycle determines how fast revenue is recognized and payments (cash) are ultimately received – if you apply these methods to an accrual-based cash collection cycle.

The faster and more efficiently a business can create and deliver their products and services, through operating improvements, the more it will enhance their gross margins, as long as pricing exceeds variable/direct expenses. Gross margins are the difference between Sales Revenue and those Direct Expenses required to deliver their product or service. Gross margins need to be sufficiently (large enough) to cover the remaining indirect or overhead costs necessary to run the business – and this is where pricing strategy comes into play. Pricing has two endpoints – pricing needs to be sufficient to effectively run a business and achieve the goals/mission of the business, while ensuring that pricing is competitive.

Many Accountants are preferring to base their Firm or Practice’s focus, exclusively on Advisory Services. Fine. But, the business Client still needs Compliance work to be completed. Transactions need to be reconciled, records updated, and financial statements, created. The point is that Clients will not draw a distinction between Accountants that are solely, Advisors and those Accountants that do Compliance work. Client’s normally expect their Accountants to do both.

We always advise Clients to take obvious actions to better cash flow to enhance faster growth. But, other advice requires a review of a business’s financials to understand the best decision(s) for future growth. One more thing. Business Owners should avoid advice from Coaches or Advisors that have no understanding of the possible repercussions that their advice might have that conflicts with applicable tax law, rules or state law.

Lastly, for business owners – be forewarned. The Accounting profession has already shifted, de-emphasizing compliance work in favor of Business Advisory Services. Everyone now calls themselves “A Fractional CFO.” A cute, overhyped, made-up term crafted to get attention and sell more. Many of these “Fractional CFO’s,” lack any background or experience in helping businesses turn their operation around – which is precisely what owners are asking for when they search for Advisory Services.

So, here’s what happens. Many Fractional CFO’s use financial (mathematical) ratios to try and identify issues and problems that a business has that is being reflected in their financials. Two problems with this. Financial problems may have root causes in operational problems. Without a basic understanding of the Clients’ business, the Fractional CFO is trying to cure the symptom and not the root cause and these problems will likely recur. Secondly, if someone is using financial rations to identify financial problems, they better be using updated data and records. If they are not, the results and (more importantly) their recommendations will be inaccurate, misleading, or just plain wrong.

Business Owners – If you’re looking to hire an Advisor, vet them.

Contact Us: 

Accounting Services – Financial Accounting and Reporting + Managerial Accounting.

Financial Accounting for compliance – To assist internal and external users with clear and concise Charts of Accounts, and Financial Statements. Managerial Accounting for internal users to improve decisions.

Business Advisory Services – Goal and target setting – Plans and roadmaps to achieve success.

Strategic planning, financial management, operating efficiency, risk assessment/management, growth strategies, and assisting business owners implement performance improvements that achieve goals and targets.

Bookkeeping Services – Accurate/clean records for compliance and decision-making.

Account adjustments, corrections, reconciliations for multi-year clean-up’s or monthly close. Transaction classification based on entity type and tax structure (disregarded, Partnerships, S-Corp’s, C-Corp’s).

Tax Services – Tax Planning, Tax Preparation and IRS Representation for Tax Debt Resolution issues.

Three categories of Tax Solutions. Tax preparation in coordination with bookkeeping to ensure accuracy. Tax planning – Deferral or mitigation of tax liability. Tax resolution – Activities that address tax debt.