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Small Business Advice


The One Financial Report Every Healthcare Practice Must Have

February 19, 2019 / by Jane Gilpin posted in Small Business Advice, Bookkeeping Services, Downtown San Diego, Healthcare

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At Supporting Strategies, we stress to small-business owners the importance of acquiring a basic understanding of key financial statements. From balance sheets to cash flow statements, we cover just about every financial report a business might need.

For the most part, healthcare practices are no different from any other type of business. A healthcare practitioner needs to understand, say, a profit and loss statement. However, one financial report that all practitioners must be familiar with is the accounts receivable aging report.

Why the Healthcare Industry Has Different Priorities
Although governed by the same accounting principles as any other business, healthcare practices face unique challenges. Government regulation, for one, including compliance with the Health Insurance Portability and Accountability Act (HIPAA). If you operate a healthcare practice, it's critical not only that you understand HIPAA laws, but that your bookkeepers and/or accountants do as well. (Here's one example of why this is so important.)

Suffice to say that if you want to avoid violating privacy laws, and the financial penalties that can result, you must carefully monitor the information you enter into the bookkeeping system.

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Business Owners: Beware the Deadlines of March

February 14, 2019 / by Elliot Hershik posted in Small Business Advice, Chicago Far West Suburbs, Business Advice

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"Beware the ides of March," Shakespeare wrote. Well, we have no idea what "ides" are, but we do know our tax deadlines.

Are You Prepared for the March Tax Deadline?
It never hurts to have a reminder about changes in tax laws, because each year brings new ones — especially this year.

You might have changed the structure of your business this year, which could in turn alter your filing status. For example, have you switched from an S corporation to a C corporation? If so, not only are you positioned to possibly pay a lower tax rate — a flat rate of 21% instead of the graduated scale from 15% to 39% — but your filing deadline also moves back from March 15 to April 15.

For S corps, partnerships and multiple-member LLCs, the deadline remains March 15. And don't think that the partial shutdown of the federal government will buy you any additional time. It does not affect any filing deadlines.

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Give Your Healthcare Bookkeeping System a Checkup

February 5, 2019 / by Jane Gilpin posted in Small Business Advice, Bookkeeping Services, Downtown San Diego, Healthcare

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Is your healthcare practice's cash flow suffering from clogged arteries? Take our checkup and find out.

Open Your Mouth and Say "Aargh!"
Most practitioners enter the healthcare field because they want to help people, not because they want to run a business. But failing to observe good business practices can create cash-flow problems that impede your practice's ability to provide quality care. Furthermore, insurance reimbursements and a thicket of regulations make healthcare an especially complicated business.

The complexity starts with third-party billing systems, which have become as much a part of healthcare as jokes about hospital food. Any healthcare provider who accepts insurance as payment is required to submit a bill with a current procedural terminology (CPT) code to the billing department. While larger hospitals typically have an in-house billing department, most smaller practices outsource that responsibility to a third party.

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“Strap yourselves in…

January 31, 2019 / by Rick Lochner posted in Small Business Advice, Chicago Far West Suburbs, Business Advice

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This blog was originally published on the ricklochner.com website.

…we’re going to jump to light speed!”

I still remember the audience’s reaction to this scene in “Star Wars: A New Hope” in 1977. We had never seen anything like it on the big screen until then and, of course, now it seems almost archaic! Today’s 21st century business environment can feel very much like everything is moving at perpetual light speed. It is also this metaphor we use to highlight the first of five Keys to Success initially mentioned in last month’s newsletter (click here to read). The first Key to Success is Get Ready to Warp (warp speed is faster than the speed of light). Simply stated, it is not the ability to adapt that matters as much as the speed at which the leader is able to adapt in order to stay relevant. Here are three things a 21st century leader can do to stay relevant:

  • How well do you know your industry? While I was once asked if I had a crystal ball to see the future, no one has that ability. However, we do have the ability to understand our industry well enough to understand key trends and how those trends impact the leader’s current and future business. In the May-June 2018 issue of “Harvard Business Review,” Jason Trujillo, IBM’s Director of Leadership Development sums up this dynamic with one sentence. He states, “IBM’s cultural transformation is aligned with the reinvention of our business, with almost half our revenue coming from businesses we weren’t in six years ago.” Six years to a company as large as IBM is virtually light speed!
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Good Bookkeeping Involves More Than Keeping the Books Current

January 22, 2019 / by John Gleason posted in Small Business Advice, Metrowest, MA, North Shore, Bookkeeping Services, Business Advice, West Houston, Central MA

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Whether you own a startup or a growing business, a professional bookkeeper will help ensure you're following standard business practices and provide the financial information you need to make better business decisions.

From recording daily transactions in the general ledger to delivering in-depth financial reporting, here are several of the key tasks a professional bookkeeping service can perform:

1. Compiling Key Financial Reports
At a basic level, the goal of any business is to take in more money than it spends. But figuring out if the business is actually doing that can be surprisingly difficult. In order to fully understand what's going on, you need to review an array of financial reports. Of particular importance — especially in the startup phase, where cash is often in short supply — is the cash flow statement. If you or your bookkeeper don't understand the implications of this statement, the results could be disastrous.

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3 Keys to a Successful Small-Business Launch

January 8, 2019 / by Mark Schanen posted in Small Business Advice, Business Advice, Milwaukee

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Fifty percent of new small businesses fail within five years. That statistic has held steady for so long, it might lead you to conclude that business is a game of chance and success is as random as the outcome of a coin flip.

That's not the case. With research and preparation, you can push your odds of a successful launch well above 50/50.

1) Do your market research.
Too many entrepreneurs think with their hearts instead of their heads. Just because you love to do something doesn't mean people will pay for your product or service in sufficient numbers for you to turn your avocation into a vocation.

So before you quit your job and sink your life savings into pursuing your passion for cupcakes and baking, you'd better figure out how many people would be inclined to buy your cupcakes, how much they'd be willing to pay, and whether you can bake your cupcakes cheaply enough at scale to turn a profit. If the numbers work, then go for it. If not — and you need to be brutally honest with yourself — then don't quit your day job.

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Would Your Small Business Be Better Off as a C Corporation?

January 3, 2019 / by Cheri Giglia posted in Small Business Advice, North Shore Long Island, Business Advice

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With special thanks to Mariya Luqmani, CPA, MST, President of MLCPAS Inc specializing in business and international taxation, for her contributions to the article.

Lately a lot of my small-business clients have been asking me about C corporations. I understand why. The Tax Cuts and Jobs Act (TCJA) has bestowed a very preferential 21% flat tax rate on corporations, replacing the previous graduated tax rate of 15% to 35%.

Does converting to a C corp make sense for you? Since the graduated rate was based largely on taxable income, the simple answer would appear to be to determine whether your company's taxable income is closer to the 15% mark (in which case converting would be a bad idea) or the 35% mark (in which case converting could be a great idea).

But as with most simple answers, the reality isn't so simple. This is particularly true of businesses that are still in the planning stages, where projecting the bottom-line taxable-income numbers is just that — a projection.

So what's a small-business owner to do?

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New Year's Resolutions (and Reconciliations) for Businesses

December 26, 2018 / by Dawn Hershik posted in Small Business Advice, Chicago Far West Suburbs, Bookkeeping Services, Business Advice

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If you run a small business, the holidays can be a distraction. It's easy to lose focus during the rush (if you're in retail) or the lull (if you're not). Either way, this is a crucial time. You need to take stock of where your financials are as this year ends and the next begins.

Don't drop the ball before watching the ball drop in Times Square. As the year ends, resolve to …

Keep good records all year long. Yes, we offered the same advice at this time last year. Did you follow it? And if you didn't, don't you wish you had? Wouldn't it be nice to relax and enjoy some holiday time with family and friends instead of scrambling to pull together 12 months of records?

It's worth repeating: At a minimum, performing monthly reconciliations and keeping accurate, up-to-date records — including all expenses, such as equipment updates or mileage, as well as W-9 and 1099 forms — will make your life (and your bookkeeper's life) much easier at tax time. It will also prepare you for any unexpected audits. Perhaps most important of all, thorough records give you insights into your business that can make it easier to create accurate budgets and forecasts.

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Scary Numbers on Small-Business Fraud

December 20, 2018 / by Mark Schanen posted in Small Business Advice, Bookkeeping Services, Business Advice, Milwaukee

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"Small businesses lose almost twice as much per scheme to fraud" as larger businesses. That's just one of the disturbing findings in the Association of Certified Fraud Examiners (ACFE) "2018 Global Study on Occupational Fraud and Abuse."

According to the study, small businesses (which the ACFE defines as having fewer than 100 employees) sustained a median loss of $200,000 per fraud scheme, compared to $104,000 for larger businesses. Moreover, the study found that "a majority of the victims recovered nothing."

A Big Problem for Small Businesses
Why are small businesses particularly vulnerable to fraud? There are several reasons. First, many small-business owners start out in the corporate world (where high-level financial controls are part of the infrastructure) before venturing out on their own. So they tend to take security measures for granted and are too trusting of the people they bring onboard to operate their new business. Let's face it: No one hires an employee whom they think will try to defraud them.

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Give Thanks to (and for) Your Clients

November 20, 2018 / by Erica Mitchell posted in Small Business Advice, Business Advice

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Thanksgiving is a good time to pause and reflect on what matters in our lives: our family, friends and freedoms, our good fortune and good health.

It's also a good time to acknowledge something else that's essential to our sense of well-being — something that some small-business owners may take for granted: our clients.

Gratitude Is an Attitude
Do you remember when you landed your first customer or client? Remember how special that moment was? Your goal of running a business was no longer an abstract dream. It was real — and all because that first client had faith in your ability.

Remember how grateful you were? You vowed to reward that vote of confidence. Your goal wasn't merely to satisfy your client, but to delight them.

That should still be your goal today with every client. Delighting clients isn't just good for the soul; it's good for business. And it can lead to more business.

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