Accountants Guide to Buying a Small Business

Posted on 20/05/2016Categories Business TrendsTags   Leave a comment on Accountants Guide to Buying a Small Business

This Accountants guide discusses buying a business and buy business tips

This Accountants guide discusses buying a business and buy business tips. Sometimes the best way to become the owner of a business is to buy a going concern. If you are considering this option, most of the factors already discussed should be considered plus these additional points.

Accountants Tip: Advantages to Buy Business

Accountants list certain advantages may be gained by buying a going business.

  • You may be able to buy business at a bargain price, if, for example, a owner is sufficiently eager to sell.
  • Buying a business as it stands will save time and effort in equipping and stocking it.
  • You gain customers accustomed to trading with the establishment.
  • Key personnel with customer or client following may be willing to stay.
  • The “good will’ founded by the prier owner may be a valued asset.

Accountants Tip: Disadvantages of Purchasing a Business

You may end up spending more than you wanted on your business because of your inaccurate appraisal or the previous owner’s misrepresentation. Accountants recommend hiring a reputable business appraisal company.

 

  • If the owner has a bad reputation you would end up keeping the reputation of former customers and, perhaps, of merchandise and equipment suppliers.
  • Not a Solid Location.
  • Check all equipment for any damages or wear and tear. (Check carefully.)
  • Too much of the merchandise or materials on hand may be old or poorly selected. When deciding how you should be paying for a going small business, consider the potential for profit. Tangible assets such as equipment and inventory could be value assets, but only to the extent that they will yield a profit in the future. If the seller is asking for a large amount for the intangible asset of good will, be careful when estimating how much – if anything – it will add tow future profits. Last but not least, determine and assess the cost of any liabilities you will be expected to assume. Be sure to have it in writing!

 

Accountants Tip: Profit Potential

When deciding if business is worth buying, you and your accountants must be aware of future profitability of the business. Almost all businesses have what you would call a “natural cycle”. Retail stores usually have a cycle of once a year. Each year follows the same pattern and several years indicate a trend. Specific types of heavy manufacturing companies could have up to a seven-year cycle. Try and guess multiple (typically, at least three) cycles. In certain businesses you are estimating three to five years however in another business you may need to be estimating future sales and profits over a 25-year period. Obviously your estimate for the next two years will be more precise than your estimate for 25 years in the future. This does not mean you shouldn’t care in your long term planning. However, It does mean your long range estimates will be more general and subject to change.

In order to accurately estimate future profits, you and your accountants should start by analyzing the current owner’s balance sheets and profit and loss statements for 5 years going back. Going back 10 years would be even better. Most businesses have insufficient or no records, but they should all have copies of their income tax returns. At times even these are slacking or, more likely, suspicious. Certain businesses have been known to “cook the books” and cerate inaccurate tax return. Insist on seeing accurate records. If you decide that you are sure about purchasing a particular business, think about making a deposit subject to getting accurate business records.

Study the expense ratios. How does the percentage for each expense classification compare with the average for the trade? The availability of average operating ratios for certain trades has already been mentioned. Comparison of the figures of the business offered for sale with standard ratios will bring out any discrepancies. In discussing these discrepancies with the seller you may become aware of operating problems which will help in making up your mind how much to pay for the business, or whether to buy it at all.

Do not be discouraged from buying the business if the past profit records are not looking to good. Accountants often say the reason the business is for sale is because of recent lack of income. Upon further inspection, it was revealed that lack of income was due to poor management. By the same token, an excellent past earnings’ record, in itself, should not persuade you to pay a large amount for the business without further investigation.

Ask the seller to prepare a projected statement of profit and loss for the next 12 months. Such an estimate will probably be very optimistic and should be compared with your own estimate. With a detailed estimate of the next 12 months’ operation, you can compute working-capital requirements for each month. Next, estimate the value of assets and liabilities as of the end of that period. Find the estimated return on investment by dividing the projected net profit by the price asked for the business. If you believe additional investment will be needed immediately to make the business run profitably, add this to the price in your computations. The highest price for the firm which brings you a return with which you are satisfied is the maximum price you should pay for the business. Thus, an estimate of future profitability will give you the basis of a logical offer for the business.

If you are not familiar with accounting and income tax records so that you may verify records of past operations and make a reasonable forecast of future operations, have an experienced accountant or management consultant work with you to help you understand the records and assist you in your evaluation.

Accountants Tip: Tangible Assets

The most commonly purchased tangible assets, in the buying business process, are merchandise inventory, equipment and fixtures, and supplies. If the business you plan to purchase sells on credit you probably will take over accounts receivable.

What is the condition of the inventory you are purchasing? Is the stock current, clean, well-balanced, in good condition? How much of it will have to be disposed of at a loss or given away? Make a careful appraisal of the stock. Each item should be separately priced and given a reasonable value. If at all possible, the inventory should be “aged”; that is, the length of time each group of items has been in stock over 18 months old, 1 year to 18 months, 6 months to 1 year, and less than 6 months should be calculated. Usually, the older the inventory, the less its value.

Examine equipment and fixtures carefully. Remember you are buying second-hand furnishings with only a percentage of their original value. Be sure equipment is in working order. Find out its age. Obtain evaluations of similar equipment, new or second hand, from dealers. Not only should you know how much equipment and fixtures have depreciated, but how obsolete they may be. Office equipment may be in working order, but so obsolete that to use it would be inefficient and costly. Also, it may be difficult to obtain repair parts for old equipment in case of a breakdown. Store fixtures quickly become out of date. New, modern fixtures attract customers. Machines used in factories may have been superseded by far more efficient equipment. To pay an exorbitant price for old machinery, no matter how good its condition, is most unwise.

Make certain how much of the asking price is for furniture, fixtures and equipment. The business may not warrant the investment which the owner made. And, finally, find out if there is a mortgage on any of the fixtures or equipment, or if they even have been completely paid for.

If you are taking over the assets such as accounts receivable, credit records, sales records, mailing lists, or leases, investigate them closely. Accounts receivable should be aged to determine how many of them may be so old collection will be difficult or impossible. On the other hand, records and contracts involving favorable leases have real value. Make certain these are included in the sale.

Accountants Tip: Goodwill in Buying a Business

Do not mistake it with “net worth”, which is the difference of the dollar values of the assets and liabilities of the business. Instead, it is the capability of the business to recognize a higher rate of return on the investment than regular in the certain type of business because of the favorable public attitude started by the owner. When goodwill leaves, it is a valuable asset.

Because you are paying for favorable public attitude, make the effort to check it. Question customers, bankers and others whom you feel have unbiased opinions. Who will have the goodwill after the business changes hands? Does it go with the business, or is it personally attached to and will it remain with the seller?

The term “goodwill” is an accountant’s fiction designed to explain the difference between the real price and the net worth. Accountants usually prefer writing off this “goodwill” in short period of time. Another way to judge the value of this intangible asset is to estimate how much more income you will receive by buying the going business than by starting a new one.

Or compare the price asked for goodwill with that asked for goodwill in similar businesses. In other words, if you are shopping around for a business, compare not only the total prices asked, but the amounts asked over and above the reasonable value of the net tangible assets.

 

 

Four Reasons Our Accounting Firm is Excelling

Posted on 24/02/201624/02/2016Categories Accounting, Archives, Business TrendsTags   Leave a comment on Four Reasons Our Accounting Firm is Excelling

We strive to be an exceptional accounting firm delivering high-quality service and maintaining operational efficiently

We work tirelessly to be an excellent Accounting Firm delivering high-quality service and maintaining operational effectively. In spite of intensive competition we standout as a result of value we supply clients.

You will find there’s two major factors that separate our accounting firm: First, we offer prospective clients a myriad of options as they begin to consider our firm. Secondly, we utilize key-metrics that accounting firm use to measure and present a superior quality service.

Four Areas Our Accounting Firm Stand Out From Our Competitors

Communication

Within the increasingly commoditized and competitive accounting firm industry, superior client relationships definitely are a significant competitive advantage, which means that clear client communication is undoubtedly an absolute organization necessity. A large amount of accounting firm get connected to clients exclusively via e mail or through shared spaces that essentially stand for file dumping areas; by using a true collaboration solution lets you interact with them in real-time, so all parties can edit, discuss and upload.

Client collaboration is really a way to ensure all parties possess the most up-to-date and accurate information, which can streamline not just for communication, but workflow at the same time. By generating a shared space to collaborate with clients in real-time, our accounting firm can trim out hours of the time spent moving back and forth on e mail, speeding up review cycles and ultimately racking up more detail than you would from appointed calls as well as meetings.

Transparency

Accounting is a service that depends heavily on trust. Clients absolutely absolutely need confidence that their private business information is safe and secure and well-managed. Providing them with comprehension of the process builds confidence in an accounting firm service that’s rare in the remaining portion of the industry, where details are generally kept tightly under-wraps. Clients choose to feel engaged in their bookkeeping, and also have insight.

Selling Your Company

Posted on 15/07/201106/07/2020Categories Business TrendsTags , , , , , , , , , ,   Leave a comment on Selling Your Company

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountant | Miami Accounting Firms | Miami CPA Firm | Miami CPA | Miami Accounting | Accountant 33157 | Accountant 33176 | Accountant 33186 | Accountant 33183 | Accountant MiamiAs a Miami Accountant, I’m oftemn approached with conversation about selling a company. I will kick off the conversation by laying out the key issues in a company sale. I think the key issues for you, your investors, and your Board to consider when you are selling your company are:

  1.    Price
       Consideration
       Reps, Warranties, and Escrow
       Integration plan
       Stay packages
       Governmental approvals
       Breakup fees
       Timing

Price is the amount the buyer will pay for the business. It is the most important issue and also the simplest.

Consideration is the mechanism the buyer will use to deliver the purchase price. The simplest form of consideration is cash in your local currency. That is also the most common form of consideration. Another common form of consideration is the acquirer’s stock. That could be publicly traded liquid stock or it could be illiquid private company stock. Buyers can also pay with debt obligations, earn out plans, and a host of other esoteric and less common forms of consideration.

Reps and Warranties are the legal promises and obligations you will take on as a seller. A portion of the purchase price is usually held back and escrowed for some period of time to backstop the reps and warranties. The escrow is usually a percentage of the purchase price. Ten percent is common but I’ve seen as little as 5% and as high as 25%.

The integration plan is the way the buyer plans to operate your business post acquisition. Many sellers don’t think this matters too much but I think it is critical. If you think about the interests of all the stakeholders in the business, not just the shareholders, then the integration plan becomes a very important part of the overall deal.

Stay packages are compensation plans put together by the buyer for your team. There may even be a stay package for you if the buyer wants you to stick around and most of the time they should. These packages are a combination of cash and stock that vests over a stay period. It is common that some of the consideration may be applied to stay packages, particularly unvested employee stock in your company.

The government, and not just your country’s government, may be required to approve the sale. This is not common for small deals. Anything sub $100mm would be very unlikely to require governmental approvals. Really big deals, like billion dollar plus transactions, often run into these issues. Big powerful companies that the government worries may have monopolistic properties will usually face governmental approvals for their acquisitions.

If your business will face negative consequences if the sale is announced and then does not close, you will want to ask the buyer to pay a breakup fee if the transaction does not close. Most buyers will resist agreeing to breakup fees but they do exist in many deals, particularly very large deals.

Timing is another important issue that many sellers don’t focus on. Sale transactions are very distracting for the senior team and often for the entire team. A long protracted sale transaction can be very harmful to the business and its stakeholders. You can put time commitments into the letter of intent to sell the company and you can expect the buyer to live up to them.

These are the most important issues in my experience when selling a business. For the next few Mondays we will focus on some real world case studies that will highlight many of these issues.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountant | Miami Accounting Firms | Miami CPA Firm | Miami CPA | Miami Accounting | Accountant 33157 | Accountant 33176 | Accountant 33186 | Accountant 33183 | Accountant Miami

Selecting a Small Business Accountant

Posted on 26/05/201106/07/2020Categories Business TrendsTags , , , , , , , , , , , , , , , , , , , , , , , , ,   Leave a comment on Selecting a Small Business Accountant

Selecting a Small Business Accountant

Many small business owners do their finances and taxes on their own, so you may ask: why should I find an accountant? The reason: no matter what stage your small business is in, you can benefit from having an accountant on your side.

Why Hire an Accountant?

  • Accountants often do more than prepare tax forms for their small business clients. They can act as a trusted consultant and advisor to your small business. A good accountant would be able to advise you on growth opportunities, risk management, bookkeeping, and general financial planning.
  • If your small business is closely tied to your personal finances, a good accountant can help you make sound judgments that are beneficial to both your personal finances and your small business.  This guidance can be especially helpful when you’re just starting up and using your own funds to finance business expenses.
  • Accountants can serve as a great resource that you can tap into for recommendations on which loans to apply for, banks that satisfy your small business needs, and whatever you need on the finance end.

Good Practices for Choosing an Accountant

Here are some tips for avoiding common pitfalls and needless headaches in your search for a small business accountant:

  • Determine your needs
    There is no one-size-fits-all method for managing small business finances. Make sure that your accountant specializes in small businesses, and ideally has knowledge of your industry.  Beyond that, you will need to decide what level of support is appropriate and affordable for your business. Enrolled agents, certified public accountants, and tax attorneys bring different skills and charge different rates.
  • Just ask!
    Word of mouth is a good way to find good accountants. Talk to your family, friends, peers, even your attorney for recommendations. You can also inquire with institutions and organizations like the American Institute of Certified Public Accountants*, your state Board of Accountants, or a local Chamber of Commerce.
  • Interview your candidates
    Remember that you are hiring someone that will fulfill your business needs and requirements. Treat it like a job interview that you would give to any potential employee. Ask about:
  • Professional qualifications like their licenses and experience
  • Personnel who will actually do the work, and their response times
  • Fees and charges to make sure they are in line with your budget
  • Specialized services that you may want in the future – for example, audit support
  • Clientele (past and current) so you can gauge their expertise

 

What if My Current Accountant Isn’t a Good Fit?

 
If you had a bad experience with an accountant, take what you’ve learned to find a better fit for your business. You should also consider your timing – if you’re just about to file significant tax changes or take on a large financial project, you’ll want to leave yourself enough time to find someone new. After all, a rush to judgment could leave you in the same position you’re in.

Remember…

You are the person who is ultimately responsible for your taxes and finances. Be wary of accountants who promise things that seem too good to be true. If you have concerns about an accountant’s claims you should contact your state’s Board of Accountancy and/or the IRS Office of Professional Responsibility to check their licenses and ensure they are in good standing.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountant | Miami Accounting Firms | Miami CPA Firm | Miami CPA | Miami Accounting | Accountant 33157 | Accountant 33176 | Accountant 33186 | Accountant 33183

Finding a CPA in Miami

Posted on 05/02/201106/07/2020Categories Business TrendsTags , , , , , , , , , , , , , ,   Leave a comment on Finding a CPA in Miami

Finding a CPA in Miami

A new Web site called Teaspiller launched on Tuesday with the aim of helping taxpayers find a Miami Accountant or Miami CPA especially during tax season. (Also works in other US cities)

Taking a page from the burgeoning Tea Party movement, Teaspiller also found inspiration from the Boston Tea Party. According to the company’s Web site, CEO Amit Vemuri, an Internet entrepreneur and former vice president at travel site Travelocity, was in a library reading up on tax and accounting history and came across an editorial reference to the Boston Tea Party protestors as “teaspillers.” He decided to use the name for the Web site he wanted to launch.

The company, which was founded in 2009, claims to already have a network of 20,000+ accountants across the country in place for the site launch. However, it’s going to be challenging some established sites like AccountantsWorld.com and CPAFinder.com, as well as services run by accounting organizations like the AICPA.

The New York-based startup claims to have several technology advantages, including complex algorithms to match various kinds of accounting and tax preparation needs with accountants who possess the appropriate skill sets and industry expertise.

Along with the search and matching technology, Teaspiller offers an individualized accountant reviews system. Maintained by the community, the reviews system aims to match accountants and customers based on factors such as tax preparation needs, specific industry characteristics and their associated tax issues, location, size, and more.

According to the announcement of the site’s launch, Vemuri wants to make his accountant-matching service into what Travelocity is for travel and Netflix is for movie rentals. Of course, if he follows in Netflix’s footsteps, he’ll have to figure out how to ship accountants in little postage-paid red envelopes or stream them over the Internet.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountant | Miami Accounting Firms | Miami CPA Firm | Miami CPA

Selecting a Small Business Accountant

Posted on 05/02/2011Categories Business TrendsTags , , , , , ,   Leave a comment on Selecting a Small Business Accountant

Selecting a Small Business Accountant

Many small business owners do their finances and taxes on their own, so you may ask: why should I find an accountant? The reason: no matter what stage your small business is in, you can benefit from having an accountant on your side.

Why Hire an Accountant?

  • Accountants often do more than prepare tax forms for their small business clients. They can act as a trusted consultant and advisor to your small business. A good accountant would be able to advise you on growth opportunities, risk management, bookkeeping, and general financial planning.
  • If your small business is closely tied to your personal finances, a good accountant can help you make sound judgments that are beneficial to both your personal finances and your small business.  This guidance can be especially helpful when you’re just starting up and using your own funds to finance business expenses.
  • Accountants can serve as a great resource that you can tap into for recommendations on which loans to apply for, banks that satisfy your small business needs, and whatever you need on the finance end.

Good Practices for Choosing an Accountant

Here are some tips for avoiding common pitfalls and needless headaches in your search for a small business accountant:

  • Determine your needs
    There is no one-size-fits-all method for managing small business finances. Make sure that your accountant specializes in small businesses, and ideally has knowledge of your industry.  Beyond that, you will need to decide what level of support is appropriate and affordable for your business. Enrolled agents, certified public accountants, and tax attorneys bring different skills and charge different rates.
  • Just ask!
    Word of mouth is a good way to find good accountants. Talk to your family, friends, peers, even your attorney for recommendations. You can also inquire with institutions and organizations like the American Institute of Certified Public Accountants*, your state Board of Accountants, or a local Chamber of Commerce.
  • Interview your candidates
    Remember that you are hiring someone that will fulfill your business needs and requirements. Treat it like a job interview that you would give to any potential employee. Ask about:
  • Professional qualifications like their licenses and experience
  • Personnel who will actually do the work, and their response times
  • Fees and charges to make sure they are in line with your budget
  • Specialized services that you may want in the future – for example, audit support
  • Clientele (past and current) so you can gauge their expertise

 

What if My Current Accountant Isn’t a Good Fit?


If you had a bad experience with an accountant, take what you’ve learned to find a better fit for your business. You should also consider your timing – if you’re just about to file significant tax changes or take on a large financial project, you’ll want to leave yourself enough time to find someone new. After all, a rush to judgment could leave you in the same position you’re in.

Remember…

You are the person who is ultimately responsible for your taxes and finances. Be wary of accountants who promise things that seem too good to be true. If you have concerns about an accountant’s claims you should contact your state’s Board of Accountancy and/or the IRS Office of Professional Responsibility to check their licenses and ensure they are in good standing.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountants | Miami Accounting Firms | Miami CPA Firm | Miami CPA

Selecting a Small Business Accountant

Posted on 05/02/2011Categories Business TrendsTags , , , , , ,   Leave a comment on Selecting a Small Business Accountant

Selecting a Small Business Accountant

Many small business owners do their finances and taxes on their own, so you may ask: why should I find an accountant? The reason: no matter what stage your small business is in, you can benefit from having an accountant on your side.

Why Hire an Accountant?

  • Accountants often do more than prepare tax forms for their small business clients. They can act as a trusted consultant and advisor to your small business. A good accountant would be able to advise you on growth opportunities, risk management, bookkeeping, and general financial planning.
  • If your small business is closely tied to your personal finances, a good accountant can help you make sound judgments that are beneficial to both your personal finances and your small business.  This guidance can be especially helpful when you’re just starting up and using your own funds to finance business expenses.
  • Accountants can serve as a great resource that you can tap into for recommendations on which loans to apply for, banks that satisfy your small business needs, and whatever you need on the finance end.

Good Practices for Choosing an Accountant

Here are some tips for avoiding common pitfalls and needless headaches in your search for a small business accountant:

  • Determine your needs
    There is no one-size-fits-all method for managing small business finances. Make sure that your accountant specializes in small businesses, and ideally has knowledge of your industry.  Beyond that, you will need to decide what level of support is appropriate and affordable for your business. Enrolled agents, certified public accountants, and tax attorneys bring different skills and charge different rates.
  • Just ask!
    Word of mouth is a good way to find good accountants. Talk to your family, friends, peers, even your attorney for recommendations. You can also inquire with institutions and organizations like the American Institute of Certified Public Accountants*, your state Board of Accountants, or a local Chamber of Commerce.
  • Interview your candidates
    Remember that you are hiring someone that will fulfill your business needs and requirements. Treat it like a job interview that you would give to any potential employee. Ask about:
  • Professional qualifications like their licenses and experience
  • Personnel who will actually do the work, and their response times
  • Fees and charges to make sure they are in line with your budget
  • Specialized services that you may want in the future – for example, audit support
  • Clientele (past and current) so you can gauge their expertise

 

What if My Current Accountant Isn’t a Good Fit?


If you had a bad experience with an accountant, take what you’ve learned to find a better fit for your business. You should also consider your timing – if you’re just about to file significant tax changes or take on a large financial project, you’ll want to leave yourself enough time to find someone new. After all, a rush to judgment could leave you in the same position you’re in.

Remember…

You are the person who is ultimately responsible for your taxes and finances. Be wary of accountants who promise things that seem too good to be true. If you have concerns about an accountant’s claims you should contact your state’s Board of Accountancy and/or the IRS Office of Professional Responsibility to check their licenses and ensure they are in good standing.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountants | Miami Accounting Firms | Miami CPA Firm | Miami CPA

Selecting a Small Business Accountant

Posted on 05/02/2011Categories Business TrendsTags , , , , , ,   Leave a comment on Selecting a Small Business Accountant

Selecting a Small Business Accountant

Many small business owners do their finances and taxes on their own, so you may ask: why should I find an accountant? The reason: no matter what stage your small business is in, you can benefit from having an accountant on your side.

Why Hire an Accountant?

  • Accountants often do more than prepare tax forms for their small business clients. They can act as a trusted consultant and advisor to your small business. A good accountant would be able to advise you on growth opportunities, risk management, bookkeeping, and general financial planning.
  • If your small business is closely tied to your personal finances, a good accountant can help you make sound judgments that are beneficial to both your personal finances and your small business.  This guidance can be especially helpful when you’re just starting up and using your own funds to finance business expenses.
  • Accountants can serve as a great resource that you can tap into for recommendations on which loans to apply for, banks that satisfy your small business needs, and whatever you need on the finance end.

Good Practices for Choosing an Accountant

Here are some tips for avoiding common pitfalls and needless headaches in your search for a small business accountant:

  • Determine your needs
    There is no one-size-fits-all method for managing small business finances. Make sure that your accountant specializes in small businesses, and ideally has knowledge of your industry.  Beyond that, you will need to decide what level of support is appropriate and affordable for your business. Enrolled agents, certified public accountants, and tax attorneys bring different skills and charge different rates.
  • Just ask!
    Word of mouth is a good way to find good accountants. Talk to your family, friends, peers, even your attorney for recommendations. You can also inquire with institutions and organizations like the American Institute of Certified Public Accountants*, your state Board of Accountants, or a local Chamber of Commerce.
  • Interview your candidates
    Remember that you are hiring someone that will fulfill your business needs and requirements. Treat it like a job interview that you would give to any potential employee. Ask about:
  • Professional qualifications like their licenses and experience
  • Personnel who will actually do the work, and their response times
  • Fees and charges to make sure they are in line with your budget
  • Specialized services that you may want in the future – for example, audit support
  • Clientele (past and current) so you can gauge their expertise

 

What if My Current Accountant Isn’t a Good Fit?


If you had a bad experience with an accountant, take what you’ve learned to find a better fit for your business. You should also consider your timing – if you’re just about to file significant tax changes or take on a large financial project, you’ll want to leave yourself enough time to find someone new. After all, a rush to judgment could leave you in the same position you’re in.

Remember…

You are the person who is ultimately responsible for your taxes and finances. Be wary of accountants who promise things that seem too good to be true. If you have concerns about an accountant’s claims you should contact your state’s Board of Accountancy and/or the IRS Office of Professional Responsibility to check their licenses and ensure they are in good standing.

Gustavo A Viera CPA

CPA firms, Accountants in Miami | Accounting Services in Miami | Accountants Miami | Certified Public Accountant in Miami | CPA in Miami | CPA Miami | Miami Accountants | Miami Accounting Firms | Miami CPA Firm | Miami CPA

What Investors Want from a Business Plan

Posted on 04/02/2011Categories Business TrendsTags , , , , , , , , , ,   Leave a comment on What Investors Want from a Business Plan

What Investors Want from a Business Plan

Here are some things that an investor wants to see in a business plan submitted for consideration for investment.  And this is more-or less in order of importance, but that order is not as rigorous as a numbered list might imply.

1. Experienced team

I want people who have done startups before. They tend to know what they’re doing and where they’re going much better once they’ve been through that process. I don’t mind that much if they weren’t the leader before, and not even that the previous startups failed. I’d like them to know the territory because it reduces risk. 

I like a team more than the single entrepreneur.  Building a business takes different skills, so ideally a team has people with diverse experience around different functions of the business: Sales, marketing, administration, and so forth.

2. Believable exits

There’s some irony here, because we built our business without caring a bit about exits, but when I think like an investor, I want to know that the money I invest is going to generate money coming out of the company, going back into my bank account, later. 

So it’s not just a matter of having a good business.  It’s a good business that will grow well and become a business that gets acquired by a larger business in 3-5 years.  A lot of good businesses will never be interesting to an acquirer.  Is it scalable?  Is it defensible?  These things make huge differences.  It’s surprising to me how many people think they can get investors interested in a people-based service business, for which the assets walk out the door every night.  Products are much better for exit than services.

3. Real growth prospects

The key to investment success is making the business worth a lot more later than what it’s worth today. That takes growth. And growth is a matter of scalability and defensibility, which I included above under exits, plus the size of market, the nature of the need, and so forth.

4. Real planning

Like many investors, I can rule out some companies just from reading a summary memo or watching a pitch presentation.  But if I’m still interested after hearing the pitch and reading the summary, then I want to see a plan.  Pitches without plans are obvious, because they don’t have the potential to drill down into the granularity when questions come up.  And of course I like a plan that is easy to decipher and well written, but what I really look for is the pieces coming together.  I want to see the conceptual links between product, marketing, sales, and financial plans.  Are they aligned with each other?  Do they indicate understanding the keys to success?  Does this look like a plan that will be managed, that can be reviewed and revised, and will remain flexible?  Or is this a plan that was done once and then forgotten.  I want to see planning and management, not just a plan. 

A final thought

None of this is completely predictable. Good investments will sometimes appear that don’t have all of the characteristics I’ve listed here. Still, all things being equal, this is a good filter to start with.

Gustavo A Viera CPA

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Say Goodbye to All Those Passwords

Posted on 02/02/2011Categories Business TrendsTags , , , , , , , , , , , , , ,   Leave a comment on Say Goodbye to All Those Passwords

Say Goodbye to All Those Passwords

The Commerce Dept. is backing a new security system for online identity checks that could be a boon for e-commerce

The convenience promised by the Internet often seems to evaporate when you log in every morning. First comes the user name and password needed to boot up your smartphone or computer. Next, a different password to access your e-mail. Want a book at Amazon.com (AMZN)? Another password (what was your first pet’s name again?) and often your credit-card information and address. Buying boots at Zappos.com, reserving a plane ticket, or checking your bank balance after all that spending? Get ready with password after password.

The U.S. Commerce Dept. is spearheading a new online security system that experts say will eliminate the password maze and perhaps boost e-commerce. The plan calls for a single sign-in each time a computer or phone is turned on, using a device such as a digital token, a smartcard, or a fingerprint reader. Once logged in, users would have access to any website that has signed up for the program. “You are your password in this system,” says John Clippinger, co-director of the Law Lab at Harvard’s Berkman Center for Internet & Society and an advocate of the plan. “It will be far more efficient and you’ll control it much more.” Activities now done offline because of security or privacy concerns—evaluating medical records or refinancing a mortgage—might migrate to the Web following adoption of the new rules, called the National Strategy for Trusted Identities in Cyberspace, or NSTIC.

Passwords don’t provide good security because most people choose character combinations that are easily hacked. A universal standard that requires some kind of device or a chip with encrypted data would keep consumer information safer while assuring companies they aren’t being scammed, says Don Thibeau, chairman of the Open Identity Exchange, an industry group representing large tech companies such as Verizon (VZ), AT&T (T), Google (GOOG), PayPal (EBAY), and Symantec (SYMC). “NSTIC could go a long way toward advancing one of the fundamental challenges of the Internet today, which is, ‘Who do you trust?’ ” Thibeau says. “This gives us the rules, the policies that we need to really move forward.”

A security standard could also cut the size of Internet company help desks, says Bruce McConnell, a counselor for national protection at the Homeland Security Dept. “The highest cost element of help desks is dealing with lost passwords,” he says. Another plus: A trusted online ID may encourage doctors to prescribe more drugs electronically, helping to save 3 million sheets of paper a year, McConnell says.

The federal government is developing the standards for the security and verification plan, but it will be voluntary, and companies that use the system will manage it. There will be no central database of user information, Commerce Dept. officials say, removing concerns over privacy. Instead, each company will maintain its own database of customers, and anyone logged in by one company would be considered safe by others using the system.

While companies have not yet said they will join the program, if the system allows them to adapt it easily for their purposes.

Gustavo A Viera CPA

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