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July 09, 2019 BY Simcha Felder

Ready, Set… Grow

Ready, Set… Grow
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By definition, an entrepreneur is a creator, a producer, an investor. So, it’s no surprise that no matter the size of their business, entrepreneurs yearn for expansion. While it might seem like today’s market is dominated by the Amazons and Facebooks of the world, the reality is that 99.7 percent of all businesses in the United States are considered “small,” totaling 28.8 million organizations with less than 100 employees. Although they likely all share the dream of growth at some point, expansion is a very risky proposition.

While 20% of small businesses fail in their first year, 50% fail in their fifth and that number rises to 70% in the tenth. These Bureau of Labor Statistics are consistent over time, suggesting that year over year economic factors do not hold outsize significance over business survival. Strategic planning does, according to Crown Sterling Ltd. CEO Robert Grant. That is because our competitors, perhaps more than any other factor, affect our outcomes. To win at business you’ll need skills, but more so you’ll need to out-strategize the other players in the game.

“Expanding a company doesn’t just mean grappling with the same problems on a larger scale,” writes Sharon Nelton in Nation’s Business. “It means understanding, adjusting to, and managing a whole new set of challenges—in essence, a very different business.” For those leaders who identify a need or avenue for growth there are important things to consider. Effective research, long range planning and a flexible budget are necessities.
A strategic plan answers some important questions, namely, what am I going to achieve by expanding and how will I get there? Some goals may include meet existing customer demands, expand into new markets or increase brand recognition. Your plan will ensure you don’t sacrifice the ultimate goal of increasing sales by sacrificing your current ones.

What do I know and not know about this new venture? Venturing into previously untapped markets is sure to unveil the unexpected. Best Buy didn’t catch on in China because big, bright stores just didn’t capture customers the way lower Chinese prices did. Starbucks underestimated its competition in Israel and bowed out of all their stores after two years. Small businesses should bear in mind that doubling the size of your company tends to increase your bills by a factor of six – budget accordingly keeping in mind the soft costs, like upgrading financial and record keeping software and communication systems.
Plan ahead but strike quickly; if you’ve anticipated a good move chances are that your competition has, as well. He who strikes first, has the advantage. Entrepreneurship is all about pushing forward and playing a step ahead of your opponent is often all it takes.
Play to win.

March 22, 2019

Transparency is key with related party transactions

Transparency is key with related party transactions
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In recent years, external auditors have focused more attention on related party transactions. Although related party transactions aren’t necessarily bad, they do raise some concerns about the risk of misstatement or omission in financial reporting.

3 focal points
Issues with related parties played a prominent role in the scandals that surfaced nearly two decades ago at Enron, Tyco International and Refco. Public outrage about these scandals led Congress to pass the Sarbanes-Oxley Act of 2002 and establish the Public Company Accounting Oversight Board (PCAOB). Similar problems have arisen in more recent financial reporting fraud cases, prompting the PCAOB to enact tougher standards on related-party transactions and financial relationships.

PCAOB Auditing Standard No. 2410 (AS 2410), Related Parties, requires auditors of public companies to beef up their efforts in financial statement matters that pose increased risk of fraud. Specifically, auditors must focus on three critical areas:

1. Related-party transactions, such as those involving directors, executives and their family members,
2. Significant unusual transactions (SUTs) that are outside the company’s normal course of business or that otherwise appear to be unusual due to their timing, size or nature, and
3. Other financial relationships with the company’s executive officers and directors.

Subjecting these transactions and financial relationships to enhanced auditor scrutiny may help avert corporate failures. The PCAOB also hopes that enhanced auditor scrutiny will lead to improvements in accounting transparency and disclosures, which will help investors to more clearly gauge financial performance and fraud risks.

From start to finish
AS 2410 requires auditors to obtain a more in-depth understanding of every related-party financial relationship and transaction, including their nature, terms and business purpose (or lack thereof). Tougher related-party audit procedures must be performed in conjunction with the auditor’s risk assessment procedures, which occur in the planning phase of an audit.

In addition, auditors are expected to communicate with the audit committee throughout the audit process regarding the auditor’s evaluation of the company’s identification of, accounting for and disclosure of its related-party relationships and transactions. They can’t wait until the end of the engagement to communicate on these matters.

During fieldwork, expect auditors to be on the hunt for undisclosed related parties and unusual transactions. Examples of information that may be gathered during the audit that could reveal undisclosed related parties include information contained on the company’s website, tax filings, corporate life insurance policies, contracts and organizational charts.

Certain types of questionable transactions — such as contracts for below-market goods or services, bill-and-hold arrangements, uncollateralized loans and subsequent repurchase of goods sold — also might signal that a company is engaged in unusual or undisclosed related-party transactions.

To facilitate the audit process, management should be up-front with auditors about all related party transactions, even if they’re not required to be disclosed or consolidated on the company’s financial statements.

Let’s be honest
Private companies also engage in numerous related party transactions, and they may experience spillover effects of the tougher PCAOB auditing standard, which applies only to audits of public companies. Regardless of whether you’re publicly traded or privately held, it’s important to identify, evaluate and disclose all related parties. We can help you present related party relationships and transactions, openly and completely.

© 2019

 

March 04, 2019

Will leasing equipment or buying it be more tax efficient for your business?

Will leasing equipment or buying it be more tax efficient for your business?
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Recent changes to federal tax law and accounting rules could affect whether you decide to lease or buy equipment or other fixed assets. Although there’s no universal “right” choice, many businesses that formerly leased assets are now deciding to buy them.

Pros and cons of leasing

From a cash flow perspective, leasing can be more attractive than buying. And leasing does provide some tax benefits: Lease payments generally are tax deductible as “ordinary and necessary” business expenses. (Annual deduction limits may apply.)

Leasing used to be advantageous from a financial reporting standpoint. But new accounting rules that bring leases to the lessee’s balance sheet go into effect in 2020 for calendar-year private companies. So, lease obligations will show up as liabilities, similar to purchased assets that are financed with traditional bank loans.

Leasing also has some potential drawbacks. Over the long run, leasing an asset may cost you more than buying it, and leasing doesn’t provide any buildup of equity. What’s more, you’re generally locked in for the entire lease term. So, you’re obligated to keep making lease payments even if you stop using the equipment. If the lease allows you to opt out before the term expires, you may have to pay an early-termination fee.

Pros and cons of buying

Historically, the primary advantage of buying over leasing has been that you’re free to use the assets as you see fit. But an advantage that has now come to the forefront is that Section 179 expensing and first-year bonus depreciation can provide big tax savings in the first year an asset is placed in service.

These two tax breaks were dramatically enhanced by the Tax Cuts and Jobs Act (TCJA) — enough so that you may be convinced to buy assets that your business might have leased in the past. Many businesses will be able to write off the full cost of most equipment in the year it’s purchased. Any remainder is eligible for regular depreciation deductions over IRS-prescribed schedules.

The primary downside of buying fixed assets is that you’re generally required to pay the full cost upfront or in installments, although the Sec. 179 and bonus depreciation tax benefits are still available for property that’s financed. If you finance a purchase through a bank, a down payment of at least 20% of the cost is usually required. This could tie up funds and affect your credit rating. If you decide to finance fixed asset purchases, be aware that the TCJA limits interest expense deductions (for businesses with more than $25 million in average annual gross receipts) to 30% of adjusted taxable income.

Decision time

When deciding whether to lease or buy a fixed asset, there are a multitude of factors to consider, including tax implications. We can help you determine the approach that best suits your circumstances.

February 25, 2019

The home office deduction: Actual expenses vs. the simplified method

The home office deduction: Actual expenses vs. the simplified method
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If you run your business from your home or perform certain functions at home that are related to your business, you might be able to claim a home office deduction against your business income on your 2018 income tax return. Thanks to a tax law change back in 2013, there are now two methods for claiming this deduction: the actual expenses method and the simplified method.

Basics of the deduction

In general, you’ll qualify for a home office deduction if part of your home is used “regularly and exclusively” as your principal place of business.

If your home isn’t your principal place of business, you may still be able to deduct home office expenses if 1) you physically meet with patients, clients or customers on your premises, or 2) you use a storage area in your home (or a separate free-standing structure, such as a garage) exclusively and regularly for your business.

Actual expenses

Traditionally, taxpayers have deducted actual expenses when they claim a home office deduction. Deductible home office expenses may include:

  • Direct expenses, such as the cost of painting and carpeting a room used exclusively for business,
  • A proportionate share of indirect expenses, such as mortgage interest, property taxes, utilities, repairs and insurance, and
  • A depreciation allowance.

But keeping track of actual expenses can be time consuming.

The simplified method

Fortunately, there’s a simplified method that’s been available since 2013: You can deduct $5 for each square foot of home office space, up to a maximum total of $1,500.

For example, if you’ve converted a 300-square-foot bedroom to an office you use exclusively and regularly for business, you can write off $1,500 under the simplified method (300 square feet x $5). However, if your business is located in a 600-square-foot finished basement, the deduction will still be only $1,500 because of the cap on the deduction under this method.

As you can see, the cap can make the simplified method less beneficial for larger home office spaces. But even for spaces of 300 square feet or less, taxpayers may qualify for a bigger deduction using the actual expense method. So, tracking your actual expenses can be worth the extra hassle.

Flexibility in filing

When claiming the home office deduction, you’re not locked into a particular method. For instance, you might choose the actual expense method on your 2018 return, use the simplified method when you file your 2019 return next year and then switch back to the actual expense method thereafter. The choice is yours.

Unsure whether you qualify for the home office deduction? Or wondering whether you should deduct actual expenses or use the simplified method? Contact us. We can help you determine what’s right for your specific situation.

February 14, 2019

When are LLC members subject to self-employment tax?

When are LLC members subject to self-employment tax?
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Limited liability company (LLC) members commonly claim that their distributive shares of LLC income — after deducting compensation for services in the form of guaranteed payments — aren’t subject to self-employment (SE) tax. But the IRS has been cracking down on LLC members it claims have underreported SE income, with some success in court.

SE tax background

Self-employment income is subject to a 12.4% Social Security tax (up to the wage base) and a 2.9% Medicare tax. Generally, if you’re a member of a partnership — including an LLC taxed as a partnership — that conducts a trade or business, you’re considered self-employed.

General partners pay SE tax on all their business income from the partnership, whether it’s distributed or not. Limited partners, however, are subject to SE tax only on any guaranteed payments for services they provide to the partnership. The rationale is that limited partners, who have no management authority, are more akin to passive investors.

(Note, however, that “service partners” in service partnerships, such as law firms, medical practices, and architecture and engineering firms, generally may not claim limited partner status regardless of their level of participation.)

LLC uncertainty

Over the years, many LLC members have taken the position that they’re equivalent to limited partners and, therefore, exempt from SE tax (except on guaranteed payments for services). But there’s a big difference between limited partners and LLC members. Both enjoy limited personal liability, but, unlike limited partners, LLC members can actively participate in management without jeopardizing their liability protection.

Arguably, LLC members who are active in management or perform substantial services related to the LLC’s business are subject to SE tax, while those who more closely resemble passive investors should be treated like limited partners. The IRS issued proposed regulations to that effect in 1997, but hasn’t finalized them — although it follows them as a matter of internal policy.

Some LLC members have argued that the IRS’s failure to finalize the regulations supports the claim that their distributive shares aren’t subject to SE tax. But the IRS routinely rejects this argument and has successfully litigated its position. The courts generally have imposed SE tax on LLC members unless, like traditional limited partners, they lack management authority and don’t provide significant services to the business.

Review your situation

The law in this area remains uncertain, particularly with regard to capital-intensive businesses. But given the IRS’s aggressiveness in collecting SE taxes from LLCs, LLC members should assess whether the IRS might claim that they’ve underpaid SE taxes.

Those who wish to avoid or reduce these taxes in the future may have some options, including converting to an S corporation or limited partnership, or restructuring their ownership interests. When evaluating these strategies, there are issues to consider beyond taxes. Contact us to discuss your specific situation.

February 11, 2019

Financial statements tell your business’s story, inside and out

Financial statements tell your business’s story, inside and out
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Ask many entrepreneurs and small business owners to show you their financial statements and they’ll likely open a laptop and show you their bookkeeping software. Although tracking financial transactions is critical, spreadsheets aren’t financial statements.

In short, financial statements are detailed and carefully organized reports about the financial activities and overall position of a business. As any company evolves, it will likely encounter an increasing need to properly generate these reports to build credibility with outside parties, such as investors and lenders, and to make well-informed strategic decisions.

These are the typical components of financial statements:

Income statement. Also known as a profit and loss statement, the income statement shows revenues and expenses for a specified period. To help show which parts of the business are profitable (or not), it should carefully match revenues and expenses.

Balance sheet. This provides a snapshot of a company’s assets and liabilities. Assets are items of value, such as cash, accounts receivable, equipment and intellectual property. Liabilities are debts, such as accounts payable, payroll and lines of credit. The balance sheet also states the company’s net worth, which is calculated by subtracting total liabilities from total assets.

Cash flow statement. This shows how much cash a company generates for a particular period, which is a good indicator of how easily it can pay its bills. The statement details the net increase or decrease in cash as a result of operations, investment activities (such as property or equipment sales or purchases) and financing activities (such as taking out or repaying a loan).

Retained earnings/equity statement. Not always included, this statement shows how much a company’s net worth grew during a specified period. If the business is a corporation, the statement details what percentage of profits for that period the company distributed as dividends to its shareholders and what percentage it retained internally.

Notes to financial statements. Many if not most financial statements contain a supplementary report to provide additional details about the other sections. Some of these notes may take the form of disclosures that are required under Generally Accepted Accounting Principles — the most widely used set of accounting rules and standards. Others might include supporting calculations or written clarifications.

Financial statements tell the ongoing narrative of your company’s finances and profitability. Without them, you really can’t tell anyone — including yourself — precisely how well you’re doing. We can help you generate these reports to the highest standards and then use them to your best advantage.

January 28, 2019

Many tax-related limits affecting businesses increase for 2019

Many tax-related limits affecting businesses increase for 2019
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A variety of tax-related limits affecting businesses are annually indexed for inflation, and many have gone up for 2019. Here’s a look at some that may affect you and your business. (more…)

July 11, 2018

How to avoid getting hit with payroll tax penalties

How to avoid getting hit with payroll tax penalties
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For small businesses, managing payroll can be one of the most arduous tasks. Adding to the burden earlier this year was adjusting income tax withholding based on the new tables issued by the IRS. (Those tables account for changes under the Tax Cuts and Jobs Act.) But it’s crucial not only to withhold the appropriate taxes — including both income tax and employment taxes — but also to remit them on time to the federal government.  (more…)

July 03, 2018 BY Simcha Felder

Surviving the Storm

Surviving the Storm
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If you see four possible ways for something to go wrong, and circumvent them all- a fifth way promptly develops. Which is why any plan not amenable to change…is a bad plan.
Strong businesses must be prepared to weather the storms that will inevitably come. A company like Coca Cola Co has, which has been in business over 130 years, has seen many such downs turns, but perhaps none quite as precarious as the negative PR campaign against sugar, that in 2004 set the industry on a downward spiral that continues to this day. The recent sugar tax being imposed across the country is the latest crushing hit in a long battle that shows no sign of letting up. (more…)

June 21, 2018

2018 Q3 tax calendar: Key deadlines for businesses and other employers

2018 Q3 tax calendar: Key deadlines for businesses and other employers
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Here are some of the key tax-related deadlines affecting businesses and other employers during the third quarter of 2018. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements.  (more…)

June 18, 2018

2 tax law changes that may affect your business’s 401(k) plan

2 tax law changes that may affect your business’s 401(k) plan
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When you think about recent tax law changes and your business, you’re probably thinking about the new 20% pass-through deduction for qualified business income or the enhancements to depreciation-related breaks. Or you may be contemplating the reduction or elimination of certain business expense deductions. But there are also a couple of recent tax law changes that you need to be aware of if your business sponsors a 401(k) plan.  (more…)

June 12, 2018 BY Michael Rabinowitsch

Should your business be an S Corp or an LLC?

Should your business be an S Corp or an LLC?
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Congratulations! You have finally decided to start your own business.

Or maybe you have been operating as a sole proprietor and have decided it is time to protect your personal assets from those involved with your growing business.

You now face the choice of whether to structure your business as an S corporation (S corp), or a limited liability corporation (LLC).

(more…)

June 05, 2018

What businesses need to know about the tax treatment of bitcoin and other virtual currencies

What businesses need to know about the tax treatment of bitcoin and other virtual currencies
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Over the last several years, virtual currency has become increasingly popular. Bitcoin is the most widely recognized form of virtual currency, also commonly referred to as digital, electronic or crypto currency.

While most smaller businesses aren’t yet accepting bitcoin or other virtual currency payments from their customers, more and more larger businesses are. And the trend may trickle down to smaller businesses. Businesses also can pay employees or independent contractors with virtual currency. But what are the tax consequences of these transactions? (more…)

May 22, 2018

The TCJA changes some rules for deducting pass-through business losses

The TCJA changes some rules for deducting pass-through business losses
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It’s not uncommon for businesses to sometimes generate tax losses. But the losses that can be deducted are limited by tax law in some situations. The Tax Cuts and Jobs Act (TCJA) further restricts the amount of losses that sole proprietors, partners, S corporation shareholders and, typically, limited liability company (LLC) members can currently deduct — beginning in 2018. This could negatively impact owners of start-ups and businesses facing adverse conditions. (more…)

May 17, 2018

Can you deduct business travel when it’s combined with a vacation?

Can you deduct business travel when it’s combined with a vacation?
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At this time of year, a summer vacation is on many people’s minds. If you travel for business, combining a business trip with a vacation to offset some of the cost with a tax deduction can sound appealing. But tread carefully, or you might not be eligible for the deduction you’re expecting. (more…)

May 15, 2018 BY Michael Rabinowitsch

Update on Tax Reform Act

Update on Tax Reform Act
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By way of introduction, my name is Michael Rabinowitsch, and I am the Senior Tax Manager in Roth&Co’s New York office, leading the Tax Compliance and Consulting division. I’m here to help our clients build efficient tax structures and map out effective tax plans to keep their companies compliant, productive and profitable.

(more…)

May 07, 2018

A review of significant TCJA provisions affecting small businesses

A review of significant TCJA provisions affecting small businesses
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Now that small businesses and their owners have filed their 2017 income tax returns (or filed for an extension), it’s a good time to review some of the provisions of the Tax Cuts and Jobs Act (TCJA) that may significantly impact their taxes for 2018 and beyond. Generally, the changes apply to tax years beginning after December 31, 2017, and are permanent, unless otherwise noted.  (more…)

April 30, 2018 BY Simcha Felder

Quality Control

Quality Control
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They say an important trait for success as an entrepreneur is optimism. The optimist will try far more things and persevere through many more failures because of his unusually positive outlook… there’s also many a pessimist who got that way by financing one. The trick is finding the right balance. Tempered optimism is enthusiastic yet skeptical; passionate about making money and equally so about losing it. (more…)

April 24, 2018

Taking it to the streets: 7 marketing strategies to consider

Taking it to the streets: 7 marketing strategies to consider
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With such intense focus on digital marketing these days, business owners can overlook the fact that there are actual, physical places to interact with the buying public. Now that spring is here and summer is on the way, it’s a good time to rediscover the possibilities of “street marketing.” Here are seven strategies to consider: (more…)

April 03, 2018

Should you file Form SS-8 to ask the IRS to determine a worker’s status?

Should you file Form SS-8 to ask the IRS to determine a worker’s status?
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Classifying workers as independent contractors — rather than employees — can save businesses money and provide other benefits. But the IRS is on the lookout for businesses that do this improperly to avoid taxes and employee benefit obligations. (more…)

March 28, 2018

2018 Q2 tax calendar: Key deadlines for businesses and other employers

2018 Q2 tax calendar: Key deadlines for businesses and other employers
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Here are some of the key tax-related deadlines affecting businesses and other employers during the second quarter of 2018. Keep in mind that this list isn’t all-inclusive, so there may be additional deadlines that apply to you. Contact us to ensure you’re meeting all applicable deadlines and to learn more about the filing requirements.  (more…)

March 06, 2018

2017 tax filing deadline for pass-through entities is March 15

2017 tax filing deadline for pass-through entities is March 15
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When it comes to income tax returns, April 15 (actually April 17 this year, because of a weekend and a Washington, D.C., holiday) isn’t the only deadline taxpayers need to think about. The federal income tax filing deadline for calendar-year partnerships, S corporations and limited liability companies (LLCs) treated as partnerships or S corporations for tax purposes is March 15. While this has been the S corporation deadline for a long time, it’s only the second year the partnership deadline has been in March rather than in April.  (more…)

February 28, 2018

Sec. 179 expensing provides small businesses tax savings on 2017 returns — and more savings in the future

Sec. 179 expensing provides small businesses tax savings on 2017 returns — and more savings in the future
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If you purchased qualifying property by December 31, 2017, you may be able to take advantage of Section 179 expensing on your 2017 tax return. You’ll also want to keep this tax break in mind in your property purchase planning, because the Tax Cuts and Jobs Act (TCJA), signed into law this past December, significantly enhances it beginning in 2018.  (more…)

February 27, 2018

5 questions to ask yourself about social media

5 questions to ask yourself about social media
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Social media can be an inexpensive, but effective, way to market a company’s products or services. Like most businesses today, you’ve probably at least dipped your toe into its waters. Or perhaps you have a full-blown, ongoing social media strategy involving multiple sites and a variety of content. (more…)

February 19, 2018

Small business owners: A SEP may give you one last 2017 tax and retirement saving opportunity

Small business owners: A SEP may give you one last 2017 tax and retirement saving opportunity
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Are you a high-income small-business owner who doesn’t currently have a tax-advantaged retirement plan set up for yourself? A Simplified Employee Pension (SEP) may be just what you need, and now may be a great time to establish one. A SEP has high contribution limits and is simple to set up. Best of all, there’s still time to establish a SEP for 2017 and make contributions to it that you can deduct on your 2017 income tax return.  (more…)

February 13, 2018

Claiming bonus depreciation on your 2017 tax return may be particularly beneficial

Claiming bonus depreciation on your 2017 tax return may be particularly beneficial
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With bonus depreciation, a business can recover the costs of depreciable property more quickly by claiming additional first-year depreciation for qualified assets. The Tax Cuts and Jobs Act (TCJA), signed into law in December, enhances bonus depreciation.  (more…)

February 01, 2018

Meals, entertainment and transportation may cost businesses more under the TCJA

Meals, entertainment and transportation may cost businesses more under the TCJA
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Along with tax rate reductions and a new deduction for pass-through qualified business income, the new tax law brings the reduction or elimination of tax deductions for certain business expenses. Two expense areas where the Tax Cuts and Jobs Act (TCJA) changes the rules — and not to businesses’ benefit — are meals/entertainment and transportation. In effect, the reduced tax benefits will mean these expenses are more costly to a business’s bottom line. (more…)

January 22, 2018

Big data strategies for every business

Big data strategies for every business
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You’ve probably heard or read the term “big data” at least once in the past few years. Maybe your response was a sarcastic “big deal!” under the assumption that this high-tech concept applies only to large corporations. But this isn’t necessarily true. With so much software so widely available, companies of all sizes may be able to devise and implement big data strategies all their own. (more…)

January 15, 2018

Not necessarily a luxury: Outsourcing

Not necessarily a luxury: Outsourcing
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For many years, owners of small and midsize businesses looked at outsourcing much like some homeowners viewed hiring a cleaning person. That is, they saw it as a luxury. But no more — in today’s increasingly specialized economy, outsourcing has become a common way to cut costs and obtain expert assistance.
(more…)

January 10, 2018

New tax law gives pass-through businesses a valuable deduction

New tax law gives pass-through businesses a valuable deduction
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Although the drop of the corporate tax rate from a top rate of 35% to a flat rate of 21% may be one of the most talked about provisions of the Tax Cuts and Jobs Act (TCJA), C corporations aren’t the only type of entity significantly benefiting from the new law. Owners of noncorporate “pass-through” entities may see some major — albeit temporary — relief in the form of a new deduction for a portion of qualified business income (QBI).
(more…)

January 03, 2018

Tax Cuts and Jobs Act: Key provisions affecting businesses

Tax Cuts and Jobs Act: Key provisions affecting businesses
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The recently passed tax reform bill, commonly referred to as the “Tax Cuts and Jobs Act” (TCJA), is the most expansive federal tax legislation since 1986. It includes a multitude of provisions that will have a major impact on businesses.
(more…)

December 29, 2017

Make budgeting part of your New Year’s resolution

Make budgeting part of your New Year’s resolution
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It’s important to resist the temptation to rely on gut instinct or take shortcuts when budgeting for 2018. Creating a solid budget that’s based on the three components of your company’s financial statements will help you manage profits, cash flow and debt.
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December 27, 2017

Make New Year’s resolutions to improve profitability

Make New Year’s resolutions to improve profitability
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Many people scoff at New Year’s resolutions. It’s no mystery why — these self-directed promises to visit the gym regularly or read a book a month tend to quickly fade once the unavoidable busyness of life sets in.
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December 13, 2017 BY Yosef Z Klein

10 Tax Moves You Should Consider Before Year End

10 Tax Moves You Should Consider Before Year End
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Tax laws for businesses are constantly changing, and they seem to get more complicated every year. Join Roth&Co expert Yosef Klein, CPA to learn the most important tax moves to make before the calendar flips—so you can keep more of your hard earned money and feel confident going into 2018.

December 06, 2017

Get smart: How AI can help your business

Get smart: How AI can help your business
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The artificial intelligence (AI) revolution isn’t coming — it’s here. While AI’s potential for your company might not seem immediately obvious, this technology is capable of helping businesses of all shapes and sizes “get smart.”
(more…)

November 30, 2017

Innovate or Stagnate

Innovate or Stagnate
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Heshy Katz, Partner at Roth&Co, discusses the importance of innovation in business. He explains how a lack of vision can lead any business to the same fate as Kodak, while constant innovation can lead to incredible gains and profit.

November 30, 2017 BY Simcha Felder

Leadership For A New Generation

Leadership For A New Generation
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Husbands everywhere agree: for maximum attention, nothing beats a good mistake. But nothing perhaps illustrates that better than the response to the Coca Cola company’s stunning announcement, in 1985, that they had reformulated their popular product and relegated the beloved Coke recipe to a locked vault forever…until they pulled it out again – quickly! The whole fiasco lasted 3 months and is considered one of the greatest marketing blunders of all time. The memory still reverberates 25 years later, and its anniversary was celebrated this month with business and marketing publications everywhere rehashing the Coca Cola co.’s epic fail during the cola wars.

(more…)

November 30, 2017

Cutting costs when you’ve gone over budget

Cutting costs when you’ve gone over budget
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Year end can’t get here soon enough for some business owners — especially those whose companies have exceeded their annual budgets. If you find yourself in this unenviable position, you can still cut costs to either improve this year’s financial picture or put yourself in a better position for next year.
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November 27, 2017

Getting around the $25 deduction limit for business gifts

Getting around the $25 deduction limit for business gifts
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At this time of year, it’s common for businesses to make thank-you gifts to customers, clients, employees and other business entities and associates. Unfortunately, the tax rules limit the deduction for business gifts to $25 per person per year, a limitation that has remained the same since it was added into law back in 1962. Fifty-five years later, the $25 limit is unrealistically small in many business gift-giving situations. Fortunately, there are a few exceptions. (more…)

November 20, 2017

4 tips on making your marketing emails a blast

4 tips on making your marketing emails a blast
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No business owner wants to send out spam. Even the term “email blast,” the practice of launching a flurry of targeted messages at customers and prospects, has mixed connotations these days.
(more…)

November 10, 2017

2017 might be your last chance to hire veterans and claim a tax credit

2017 might be your last chance to hire veterans and claim a tax credit
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With Veterans Day on November 11, it’s an especially good time to think about the sacrifices veterans have made for us and how we can support them. One way businesses can support veterans is to hire them. The Work Opportunity tax credit (WOTC) can help businesses do just that, but it may not be available for hires made after this year.  (more…)

October 24, 2017

4 ways to get (and keep) your business data in order

4 ways to get (and keep) your business data in order
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With so much data flying around these days, it’s easy for a company of any size to get overwhelmed. If something important falls through the cracks, say a contract renewal or outstanding bill, your financial standing and reputation could suffer. Here are four ways to get — and keep — your business data in order:

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October 11, 2017

Critical Connection: How Costs Impact Pricing

Critical Connection: How Costs Impact Pricing
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As we head toward year end, your company may be reviewing its business strategy for 2017 or devising plans for 2018. As you do so, be sure to give some attention to the prices you’re asking for your existing products and services, as well as those you plan to launch in the near future.

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October 03, 2017

2 ways spouse-owned businesses can reduce their self-employment tax bill

2 ways spouse-owned businesses can reduce their self-employment tax bill
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If you own a profitable, unincorporated business with your spouse, you probably find the high self-employment (SE) tax bills burdensome. An unincorporated business in which both spouses are active is typically treated by the IRS as a partnership owned 50/50 by the spouses. (For simplicity, when we refer to “partnerships,” we’ll include in our definition limited liability companies that are treated as partnerships for federal tax purposes.)

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September 26, 2017

Don’t Let “Founder’s Syndrome” Impede Your Succession Plan

Don’t Let “Founder’s Syndrome” Impede Your Succession Plan
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Are you the founder of your company? If so, congratulations — you’ve created something truly amazing! And it’s more than understandable that you’d want to protect your legacy: the company you created.
But, as time goes on, it becomes increasingly important that you give serious thought to a succession plan. When this topic comes up, many business owners show signs of suffering from an all-too-common affliction.
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September 19, 2017

How Profitable Are Your Customers?

How Profitable Are Your Customers?
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“We love our customers!” Every business owner says it. But all customers aren’t created equal, and it’s in your strategic interest to know which customers are really strengthening your bottom line and by how much.

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September 13, 2017

Tax Planning Critical When Buying a Business

Tax Planning Critical When Buying a Business
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If you acquire a company, your to-do list will be long, which means you can’t devote all of your time to the deal’s potential tax implications. However, if you neglect tax issues during the negotiation process, the negative consequences can be serious. To improve the odds of a successful acquisition, it’s important to devote resources to tax planning before your deal closes.

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August 03, 2017

4 Tough Questions to Ask Before Expanding to a New Location

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Is business going so well that you’re thinking about adding another location? If this is the case, congratulations! But before you start planning the ribbon-cutting ceremony, take a step back and ask yourself some tough questions about whether a new location will grow your company — or stretch it too thin. Here are four to get you started:

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August 01, 2017

Listening to Your Customers by Tracking Lost Sales

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“Sorry, we don’t carry that item.” Or perhaps, “No, that’s not part of our service package.” How many times a year do your salespeople utter these words or ones like them? The specific number is critical because, if you don’t know it, you could be losing out on profit potential.

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July 25, 2017

Listen and Trust: The Power of Collaborative Management

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Many business owners are accustomed to running the whole show. But as your company grows, you’ll likely be better off sharing responsibility for major decisions. Whether you’ve recruited experienced managers or developed “home grown” talent, you can empower these employees by taking a more collaborative approach to management.

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July 23, 2017

Nonprofits: Harness the Power of the Personal Appeal

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You’ve probably heard it before: People don’t give to causes — they give to those asking on behalf of a cause. That’s why a personal appeal continues to be such a powerful not-for-profit fundraising tool. In fact, requests from friends or family members typically drive most charitable donations. By appealing to their networks, board members can be particularly effective fundraisers.

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July 20, 2017

Make Sure Your Company is Prepared for Any Disaster

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What could stop your company from operating for a day, a month or a year? A flood or fire? Perhaps a key supplier shuts down temporarily or permanently. Or maybe a hacker or technical problem crashes your website or you suddenly lose power. Whatever the potential cause might be, every business needs a disaster recovery plan.

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July 11, 2017

How can you take customer service to the next level?

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Just about every business intends to provide world-class customer service. And though many claim their customer service is exceptional, very few can back up that assertion. After all, once a company has established a baseline level of success in interacting with customers, it’s not easy to get to that next level of truly great service. But, fear not, there are ways to elevate your game and, ultimately, strengthen your bottom line in the process.

Start at the top
As is the case for many things in business, success starts at the top. Encourage your fellow owners (if any) and management team to regularly serve customers. Doing so cements customer relationships and communicates to employees that serving others is important and rewarding. Your involvement shows that customer service is the source of your company’s ultimate triumph.

Moving down the organizational chart, cultivate customer-service heroes. Publish articles about your customer service achievements in your company’s newsletter or post them on your website. Champion these heroes in meetings. Public praise turns ordinary employees into stars and encourages future service excellence.

Just make sure to empower all employees to make customer-service decisions. Don’t talk of catering to customers unless your staff can really take the initiative to meet your customers’ needs.

Create a system
Like everyone in today’s data-driven world, customers want information. So strive to provide immediate feedback to customers with a highly visible response system. This will let customers know that their input matters and you’ll reward them for speaking up.

The size and shape of this system will depend on the size, shape and specialty of the company itself. But it should likely encompass the right combination of instant, electronic responses to customer inquires along with phone calls and, where appropriate, face-to-face interactions that reinforce how much you value their business.

Give them a thrill
Consistently great customer service can be an elusive goal. You may succeed for months at a time only to suffer setbacks. Don’t get discouraged. Our firm can help you build a profitable company that excels at thrilling your customers.

June 26, 2017

New York Paid Family Leave Update

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New York’s Paid Family Leave Benefits law (PFL), is set to take effect on January 1, 2018 and impacts all employers with employees working in New York.

What does the law provide?
The law provides eligible employees up to 12 weeks of paid, job protected leave starting on January 1, 2018 to (1) care for a family member with a serious health condition, (2) bond with a child during the first twelve months after the child’s birth, adoption, or placement in foster care, or (3) attend to a “qualifying exigency.”

How is the leave funded?

The PFL will be funded through deductions taken from the pay of full-time and part-time employees. On June 1, 2017, the Department of Financial Services announced the weekly contribution rate and the maximum employee contribution. The premium rate for Family Leave Benefits and the maximum employee contribution for coverage beginning January 1, 2018 is set at 0.126% of an employee’s weekly wage up to and not to exceed the statewide average weekly wage. New York State’s current average weekly wage is $1,305.92.

Starting July 1, 2017, employers may, but are not required to, begin deducting the contribution amount from employee wages to pay for the 2018 coverage period. This amount can be used to offset the cost of acquiring the mandated insurance policies. Employers who choose not to begin taking deductions on July 1, 2017, cannot retroactively make deductions in excess of the maximum weekly contribution to cover the cost of providing the required leave benefit.

Next Steps
No action is required by you at this time. The New York Workers’ Compensation Board has not yet issued the final regulations implementing the PFL law. We continue to assess the impact of the law on the services we provide in order to determine how best to serve you and will keep you informed.

As always please, reach out if you have any questions.

June 19, 2017

Don’t Make Hunches- Crunch The Numbers

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Some business owners make major decisions by relying on gut instinct. But investments made on a “hunch” often fall short of management’s expectations.

In the broadest sense, you’re really trying to answer a simple question: If my company buys a given asset, will the asset’s benefits be greater than its cost? The good news is that there are ways — using financial metrics — to obtain an answer.

Accounting payback

Perhaps the most common and basic way to evaluate investment decisions is with a calculation called “accounting payback.” For example, a piece of equipment that costs $100,000 and generates an additional gross margin of $25,000 per year has an accounting payback period of four years ($100,000 divided by $25,000).

But this oversimplified metric ignores a key ingredient in the decision-making process: the time value of money. And accounting payback can be harder to calculate when cash flows vary over time.

Better metrics

Discounted cash flow metrics solve these shortcomings. These are often applied by business appraisers. But they can help you evaluate investment decisions as well. Examples include:

Net present value (NPV). This measures how much value a capital investment adds to the business. To estimate NPV, a financial expert forecasts how much cash inflow and outflow an asset will generate over time. Then he or she discounts each period’s expected net cash flows to its current market value, using the company’s cost of capital or a rate commensurate with the asset’s risk. In general, assets that generate an NPV greater than zero are worth pursuing.

Internal rate of return (IRR). Here an expert estimates a single rate of return that summarizes the investment opportunity. Most companies have a predetermined “hurdle rate” that an investment must exceed to justify pursuing it. Often the hurdle rate equals the company’s overall cost of capital — but not always.

A mathematical approach

Like most companies, yours probably has limited funds and can’t pursue every investment opportunity that comes along. Using metrics improves the chances that you’ll not only make the right decisions, but that other stakeholders will buy into the move. Please contact our firm for help crunching the numbers and managing the decision-making process.

May 23, 2017

A Cyberattack of Unprecedented Scale

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Just days after President Trump signed a much-anticipated executive order on cybersecurity, a massive cyberattack—potentially the largest the world has ever seen, with more than 75,000 ransomware attacks in 153 countries—stole headlines.

The “WannaCry” ransomware program hit organizations around the world on Friday, May 12, encrypting computer files and demanding roughly the equivalent of $300 in Bitcoin (increasing over time) to restore user access.

Russia, Ukraine, India and Taiwan were reportedly the most affected countries, but organizations across Europe, Asia and North America—with an estimated 3,300 infections in the U.S. alone—were also attacked. Notable targets included, among others, the Russian Interior Ministry, logistics carrier FedEx, automakers Renault and Nissan, a number of Chinese universities and secondary schools, as well as Britain’s National Health System (NHS). Forty-seven of the 248 NHS trusts were attacked by the ransomware program, and as of May 15, seven trusts had yet to regain control of their computer systems.

The rapid spread of WannaCry is slowing, for two primary reasons: 1) Microsoft took the rare step of issuing patches for outdated versions of Windows operating systems it no longer supports, going back as far as 14 years; and 2) the accidental discovery of a “kill switch” by a security researcher in Britain, which spared much of the U.S. However, neither “fix” helps systems that are already infected, and hackers could easily create a new strain of WannaCry that bypasses or negates the kill switch.

In response to the threat, the FBI issued a FLASH (FBI Liaison Alert System) report with confirmed threat indicators and recommended steps for prevention, remediation, and defending against ransomware generally.


What is ransomware?

Ransomware is a type of malware that targets critical data and information systems for purposes of extortion, preventing users from accessing their data files until a ransom is paid. The software frequently infects computers through spear-phishing—a targeted attack via a malicious link or email attachment. Ransom demands are most often made in the difficult-to-trace virtual currency Bitcoin.


What’s different about WannaCry?

In April, an elusive cyber group called the “Shadow Brokers” leaked a cache of powerful NSA hacking tools, including highly sophisticated (and expensive) software exploits. WannaCry is purportedly based on one or more of these exploits, taking advantage of a zero-day vulnerability in Microsoft Windows that enables it to spread itself laterally.  Microsoft issued a security update to address this bug in March, but users that didn’t make the update remain vulnerable.

WannaCry is the first cyber program to make use of the leaked NSA tools—but likely not the last.


Why were healthcare organizations the hardest hit?

The healthcare sector remains uniquely at risk to cyber incidents due to a variety of factors, including a lack of resources devoted to cybersecurity, the complexity of networks, and the vast array of internet-connected devices. Because many hospitals still maintain and rely on end-of-life technologies, and may prioritize immediate access to data over data security, cybercriminals have found their systems relatively easy to penetrate.

The healthcare sector is also one of the most targeted sectors by cybercriminals and nation states because it is the only sector which combines highly valuable and sought-after bulk data sets of personal health information, personally identifiable information, payment information, medical research and intellectual property.

Hospitals also don’t have the luxury of time: A ransomware infection that blocks access to critical medical data endangers patients’ health. Ahead of a scenario where patients’ lives are at risk, organizations should ensure they have preventive measures in place.


Is your organization safe?

The FBI recommends the following preventative measures:

  • Apply the Microsoft patch for the MS17-010 SMB vulnerability dated March 14, 2017.  (Organizations using unsupported Windows operating systems including Windows XP, Windows 8 and Windows Server 2003 should follow customer guidance from Microsoft.)
  • Enable strong spam filters to prevent phishing e-mails from reaching end users and authenticate in-bound e-mail using technologies like Sender Policy Framework, Domain Message Authentication Reporting and Conformance, and DomainKeys Identified Mail.
  • Scan all incoming and outgoing e-mails to detect threats and filter executable files from reaching the end users.
  • Ensure anti-virus and anti-malware solutions are set to automatically conduct regular scans.
  • Manage the use of privileged accounts, assigning administrative access only when absolutely needed.
  • Configure access controls including file, directory, and network share permissions with least privilege in mind.
  • Disable macro scripts from Microsoft Office files transmitted via e-mail. Consider using Office Viewer software to open Microsoft Office files transmitted via e-mail instead of full Office suite applications. Develop, institute and practice employee education programs for identifying scams, malicious links and attempted social engineering.
  • Have regular penetration tests run against the network, no less than once a year, and ideally, as often as possible/practical.
  • Test your backups to ensure they work correctly upon use.

We offer these additional recommendations:

  • Don’t forget the human element. The WannaCry attack was entirely preventable. It succeeded at infecting computers because users failed to install a months-old patch—in other words, because of human negligence and a lack of awareness. Change user behavior by introducing a training program based on employees’ organizational roles, implementing cyber hygiene best practices (i.e., not opening suspicious emails or attachments) and regularly testing the program’s effectiveness.
  • Implement a risk-based, threat-driven patch management program. Patch management should be a dynamic, risk-based process rather than a check-the-box compliance approach. Organizations must be able to identify system vulnerabilities and relevant patches in a timely manner, understand the degree of risk the vulnerability presents, and work with asset owners to deploy the update.
  • Monitor, monitor, monitor. To be cyber resilient, organizations need to have threat monitoring and analytics tools to detect an attack, as well as the investigative and digital forensics capabilities to understand what went wrong and the scope of the damage. The sooner a cyberattack is detected, the sooner incident response and mitigation strategies can be put into effect. When it comes to ransomware, early detection can make all the difference in salvaging critical data and information systems.

 

What should you do when preventative measures fall short?

  • Isolate the issue. Buy more time to respond to the attack by removing infected systems from the network and cutting off access to the parts of the network that are not corrupted. Change the passwords to those isolated segments, if possible.
  • Secure backup data or systems by taking them offline. Make sure your backups are clean.
  • Contact your local FBI field office’s Cyber Task Force immediately. The FBI is there to help; its role is not to find fault or lay regulatory blame on a victim organization, but rather to conduct the investigation in cooperation with the victim organization and determine who perpetrated the attack.
  • Implement your incident response plan. Ensure all stakeholders have been notified and understand their respective responsibilities.
  • Change all passwords. Once your networks are back up and running, change all online account and network passwords.

https://alliance.bdo.com/document/cybersecurity-alert-wannacry-ransomware-program

April 19, 2017 BY Zacharia Waxler, Co-Managing Partner

Secrets to a Successful Workforce

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Part I of II – The Importance of Employee Engagement

A CEO was asked how many people work in his company: “About half of them,” he responded.” It may be a joke, but in reality it can be a serious problem that a significant number of people had mentally “checked out.”

Quite clearly, CEOs and managers should be very concerned about a waste of time, effort and resources in their organizations. The reason is simple: If people are not engaged, how can these same leaders attain those business objectives that are critical to improving organizational performance?

What do we mean by employee engagement? How much does a lack of employee engagement cost an organization? What steps can leaders take to make employees want to give it their best? These and other questions are the focus of this article.


Do you, as a business owner or CEO, wake up in the morning excited to get out of bed and go to work? Are you excited to implement some new great ideas? Are you excited to meet your team and continue the project you’ve been working on the day before?

The real question is:
Are your employees just as excited as you are? Are they engaged in what they do?

What is employee engagement?
Employee engagement is about understanding one’s role in an organization, and being sighted and energized on where it fits in the organization’s purpose and objectives. Employee engagement is about having a clear understanding of how an organization is fulfilling its purpose and objectives, how it is changing to fulfil those better, and being given a voice in its journey to offer ideas and express views that are taken account of as decisions are made. Employee engagement is about being included fully as a member of the team, focused on clear goals, trusted and empowered, receiving regular and constructive feedback, supported in developing new skills, thanked and recognized for achievement. Employee engagement is about positive attitudes and behaviors leading to improved business outcomes, in a way that they trigger and reinforce one another. Employee engagement is about your employees feeling pride and loyalty working for our organization, being a great advocate of the organization to our clients, users and customers, going the extra mile to finish a piece of work. Employee engagement is about drawing on our employees’ knowledge and ideas to improve our products and services, and be innovative about how we work. Employee engagement is about drawing out a deeper commitment from our employees so fewer leave, sick absence reduces, accident rates decline, conflicts and grievances go down, productivity increases. And finally, Employee engagement is about organization actions that are consistent with the organization’s values. It is about kept promises, or an explanation as to why they cannot be kept.

In order to have an engaged employee we must have an engaged organization. Engaged organizations have strong and authentic values, with clear evidence of trust and fairness based on mutual respect, where two-way promises and commitments – between employers and employees – are understood and fulfilled.

Here are some facts that the Gallup Management Journal has published in a semi annual employment engagement index.
• Only 29% of employees are actively engaged in their jobs. These employees work with passion and feel a profound connection to their company. People that are actively engaged help move the organization forward.

• 54% of employees are not engaged. These employees have essentially “checked out,” sleepwalking through their workday and putting time – but not passion – into their work. These people embody what Jack Welch said several years ago. To paraphrase him: “Never mistake activity for accomplishment.”

• 17% of employees are actively disengaged. These employees are busy acting out their unhappiness, undermining what their engaged co-workers are trying to accomplish. Needless to say how detrimental this behavior is to the morale of the entire workforce.

Should business owners be concerned about these findings? It seems obvious that engaged employees are more productive than their disengaged counterparts. For example, a recent meta-analysis published in the Journal of Applied Psychology concluded that, “… employee satisfaction and engagement are related to meaningful business outcomes at a magnitude that is important to many organizations.”

A compelling question is this: How much more productive is an engaged workforce compared to a non-engaged workforce?
Several case studies shine some light on the practical significance of an engaged workforce. For example, New Century Financial Corporation, a U.S. specialty mortgage banking company, found that account executives in the wholesale division who were actively disengaged produced 28% less revenue than their colleagues who were engaged. Furthermore, those not engaged generated 23% less revenue than their engaged counterparts. Engaged employees also outperformed the not engaged and actively disengaged employees in other divisions. New Century Financial Corporation statistics also showed that employee engagement does not merely correlate with bottom line results – it drives results.

But what should leaders do, or consider doing, to increase the level of engagement among employees? I will let you think about it and we will discuss it in a future article.

April 18, 2017 BY Yehuda Bunker, CPA

The importance of Internal Control

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Small businesses (fewer than 100 employees) lose relatively more to employee fraud than larger business do. About 87% of embezzlers are first time offenders. Nearly every one is a trusted employee. That is (in 31 words) why you need to improve the internal controls at your business.
Segregation of duties is one of the most effective means of reducing employee fraud. You should separate the following responsibilities in each business process:
• Custody of assets
• Record keeping
• Authorization
• Reconciliation

In this article we discuss controls over the Cash Receipts business cycle.

The person who receives customer payments should record the payments either in a cash register, on a deposit slip, or in a receipts log. This person should not be able to record or authorize transactions in the accounts receivable ledger or customer accounts. In addition, this person should not be allowed to record cash transactions or prepare the bank reconciliation.

Adjustments and write-offs to customer accounts should be reviewed and approved by an employee who is not able to record these transactions. In addition, this person should not be allowed to reconcile the accounts receivable subsidiary ledger to the general ledger.

Employees responsible for recording adjustments to customer accounts should not process customer payments or prepare the bank deposit.

The bank accounts should be reconciled by someone who is not able to record cash receipts or disbursements. Bank reconciliations should be reviewed and approved by someone other than the preparer.

When duties cannot be segregated, compensating controls should be used. For example, two employees, working together, could receive and open customer payments and prepare the bank deposit.

Roth&Co is ready and willing to help you design and implement a better internal control system. For further discussion or a specific proposal, please reach out.

April 06, 2017 BY Heshy Katz, CPA

Thinking BIG: Growing Your Business in 2017

Thinking BIG: Growing Your Business in 2017
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Heshy Katz, Roth&Co partner, discusses the use of innovation in the workplace, how you can apply these lessons to your business.

“Innovation is not a technology, but rather a method of evolving and changing to help keep businesses unique and relevant”

January 04, 2017 BY Yosef Z. Klein, CPA

New York and New Jersey Increase Minimum Wage

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• The minimum wage has been raised in New York and New Jersey as of beginning of this year.
• Review and update your wage schedules as soon as possible.
• Employees subject to minimum wage laws need to be paid the higher of the federal and applicable state minimum wage.

Federal:
The federal minimum wage for covered nonexempt employees is $7.25.

Many states also have minimum wage laws. In cases where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages.

New York:
The 2017 minimum wage in New York State can be from $9.70 to $11.00 and in some cases $12.00. This depends on your location, industry and size.

For example:
• A large (11 or more employees) employer in New York City must pay $11.00/hour.
• Fast food employers in New York City must pay $12.00/hour.

New Jersey:
The 2017 minimum wage in New Jersey is $8.44 (up from $8.38 in 2016).

If you have any questions about whether and how this will impact you, please speak with a Roth & Co professional, who will be able to guide you with any changes that may be necessary.

Additional resources
Federal Minimum Wage: http://bit.ly/2iACTgg
New York Minimum Wage: http://on.ny.gov/2j4QoBU
New Jersey Minimum: Wage: http://bit.ly/2iIw4dh
Other states: http://bit.ly/1T5AzJV

November 18, 2016

Roth&Co Client Spotlight: FABUWOOD

Could a long-term deal ease your succession planning woes?
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November 14, 2016 BY Moshe Gelbtuch, CPA

Succession Planning

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November 09, 2016

Mind My Business – Small Businesses

Mind My Business – Small Businesses
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Small businesses are loved because of the personalized service they can provide. But what happens when a customer shows up with a list of demands longer than the mighty Mississippi? Unfortunately, it’s not uncommon for an oddball request to push the boundaries of the owner-client relationship. When demands are made, remember these tips:

 

1. Don’t blow a fuse.
Even if the request seems ridiculous, take a deep breath and maintain your composure. Your calm demeanor can help change the course of the conversation and get to a reasonable resolution.

 

2. Empathy goes a long way.

Even if the request is over the top, put yourself in your customers’ shoes. It shows that you’re listening and willing to work toward a solution.

 

3. Just say no.
There may be a time when you simply can’t honor a request, such as if it conflicts with company policy or legal regulations. Instead, offer a new option the customer might not have considered and work toward a compromise.

 

4. Rein it in.
After handling a request, gently set the expectation that this will be a one-time option due to business constraints, but that you’re happy to make an exception for a loyal customer.

Seemingly unreasonable demands can test anyone’s patience. But if handled appropriately—with tact and understanding—you can still maintain high customer satisfaction and loyalty.

Roth&Co’s team can assist you with all of your accounting and financial needs. Speak to your account representative for more information, or contact an accountant today at 718.236.1600 to schedule an appointment.