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Posts by TFOSLLC

You Bet Your Sweet Asset that Equipment Impacts Your Finances

The company car. The company computer.  The  office furniture. The stuff in the shop. Phones. Signs.

You know, the stuff that makes up the structure of your company?

Assets.

There are tangible and intangible assets.  Either way, they need, or should, be accounted for. Examples of assets you need to account for on your balance sheet:

  • Buildings and office equipment and other things not consumed during the course of doing business.
  • Depreciable assets like machinery and vehicles that are used as part of the business process.
  • Current assets including on-hand inventory and accounts receivable.

And while you can’t put them on the balance sheet, there are things that have value that could be converted to cash in this information economy:

  • Reputation, know-how and industry knowledge.
  • Brands and trademarks.
  • Formulas, patents, inventions and creative communication.

The point of all this is that your company is made up of stuff that has value.  You need to account for this value to ensure the stability and ongoing health of your company.

This list is just a starting place.  However, it should help you sort out value as you communicate with your finance team (CPA, accountant, bookkeeper) when managing your company’s finances.

We love numbers.  If you are looking for help with your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the board room.

*Photos courtesy of Unsplash (photographers Denny Muller and Scott Graham)

 

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How to Weather an Economic Downturn

The economy is cyclic.  So it is only a matter of time before you and your business experience a downturn.  But there is good news: things will come back.

Or so says history. And, at the moment, we are living it. A war in Europe. High gasoline prices. Supply chain issues.

As the saying goes ”if you fail to plan you are just planning to fail.” In other words, just make sure you are thinking about a downturn before it happens.

What should you do? Here’s a short list:

  • Create a 5-yer plan for your company.
  • Talk with your contractors and suppliers to help share the workload.
  • Let your employees in on the coming crisis.
  • Manage inventory and your supply chains.
  • Build an emergency fund.
  • Cut out waste or things that are not necessary.
  • Pay down debt.
  • Don’t be afraid to ask for help.
  • Consider helping others.

History shows us that downturns turn back up.  We survived 1987 and 2008 and other downturns before then.  Fact is, that we all need to think for the long term.  That’s where that 5-year plan fits so well with this concept of survival.

We love numbers.  If you are looking for help with your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the board room.

*Photos courtesy of Unsplash (photographers Luke Chesser and Towfigu barbhuiya)

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Best Practices for Bookkeepers

Bookkeeper /ˈbo͝o(k)ˌkēpər/ noun a person whose job is to keep records of the financial affairs of a business. “The business had grown enough to justify hiring a bookkeeper”

Keeping the books. Controlling the finances. Knowing about the money side of the business. Everybody either has or should have someone like this in their business.

We’ve talked about the different financial roles in a business in this space before.  But the role of the bookkeeper (as opposed to the accountant or CPA or CFO) has its own set of things to consider in helping keep the business financially healthy.

With that said, here are few “best practices” for bookkeepers from my perspective:

  1. Keep business and personal finances separate.
  2. Track cash and know your cash flow.
  3. Keep track of all expenses.
  4. Create and follow a budget to ensure payments are received and made on time.
  5. Maintain accurate records.
  6. Choose your accounting method and stick with it.
  7. Use credible accounting software.
  8. Work with the rest of the financial team (CPA, accountant) to ensure compliance with US GAAP rules and regulations.
  9. Build an audit trail.
  10. Create timely reports.

This list is just a starting place.  However, it highlights the most important things that a bookkeeper must keep in mind when managing a company’s finances.

We love numbers.  If you are looking for help with your finances, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the board room.

*Photos courtesy of Unsplash (photographers Northfolk and Visual Stores Michelle

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Rules for Working with the Funded Entrepreneur

Entrepreneurs are interesting people. They are talented, insightful, creative and visionary. They have an ability to make an idea or concept into a reality. Taking something out of thin air and making it tangible.

But when it comes to money and finances, eh, that is not always their forte.

So as a financial professional, I find myself often working with these folks who have found a way to get funding but not take their project to the next level. That’s why I came up with a list of rules for working with what I call the Funded Entrepreneur.

  1. Be bonded by trust. Be a trusted advisor and partner.
  2. Understand their ideas and share in their passion for their business. Look for and suggest options for their business they hadn’t thought of.
  3. Be the voice of reason.
  4. Advice does not dictate. Have a dialogue between you so that neither of you lectures the other. Know when to stop talking and listen.
  5. Help them understand their finances at a high level and in the context of their business and markets. Stay out of the weeds.
  6. Be the financial brains while they are the creative and director of the whole business.
  7. Show them how to grow financially while growing creatively.
  8. Help them understand when to stay with a business and when to consider an exit
  9. Plan for the future and ask tough questions.

We love numbers. If you are looking for help with your finances, write to us at info@tfosolutionsllc.com. TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*Photos courtesy Unsplash (photographers Adeolu Eletu and Daria Nepriakhina

 

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It’s that taxing time of year

The calendar page has turned to January and with it…the thought of taxes.

Yup, right up there with death is taxes.  Most assuredly.  It’s time to think about what you need to gather for the past year and also to prepare so you can survive your taxation experiences in the coming year.

Whether you are a small business or an individual, you need to be prepared as you collect data to file your previous year’s return and planning for the new year’s tax implications.  Checklists are always a help, but the basics remain the same.  Gather data around these areas:

  • Personal information
  • Income data
  • Deductions
  • Credits
  • Payments

When it comes to the year just past, these are historical data—stuff that happened and can be documented.

For planning purposes it is more of a forecasting exercise and preparation for the coming year so you aren’t blindsided at the end.

Whatever you do, be prepared, plan and keep cool.  Oh, and don’t be afraid to engage a professional who does this all of the time.  Your CPA, bookkeeper and accountant are like an army at this time of year.

We love numbers.  If you are looking for help with your taxes or anything financial, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*photos courtesy of Unsplash (Jon Tyson and the New York Public Library, photographers)

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KISS

Simplicity.  Unnecessary complexity. Overthinking things.

Applying the KISS principle to our business lives can pay dividends.  Originated in the 1960s by US Navy design engineers, it emphasizes that simplicity should be the key goal in design.

Carry that over from fighter jets to business, think about all of the things that could benefit from being looked at from an uncomplicated point of view: operations, marketing, sales, finance.

That last one really could benefit from simplicity.  And actually pay dividends.

Uncomplicating things could mean simplifying processes.  Do you have the latest software that manages your?

  • Accounting
  • Payroll
  • Project management
  • Email campaigns
  • Social media

Having plug-and-play options makes your implementation of things work more smoothly and efficiently.  Fewer steps can eliminate work and even reduce errors.

While getting to simple could be harder in the beginning, once you get there, it could (and will) pay dividends.  The process to get there will uncover things and reveal simple options to you.

We love simplicity.  If you are looking to simplify the financial aspect of your company, call or write to us.  TFO Solutions is dedicated to helping entrepreneurs and business owners with their financial strategy from the back office to the boardroom.

*photos courtesy of Unsplash (Tim Mossholder and Etienne Giradet, photographers)

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