hiring professionals

When You Should Fire Your Accountant

Debbie Dragon — Thu, 08 Nov 2012 10:36:51 +0000

Having an accountant can help you keep track of finances, reduce your tax burden, and make more efficient use of your money. If you own a small business, it’s especially important to hire an accountant, but even individuals can benefit from their services. Those advantages, however, only happen when you have a professional accountant who can do the job well. If you have had some doubts about your accountant's abilities, then you should know when it makes sense to fire your accountant and find someone else. Here are some reasons to consider firing your accountant. (See also: 3 Things Your Accountant May Not Be Telling You)

Dishonesty and Over-Billing

Your accountant's job isn't to scam you out of money or find ways to make your bill larger. Dishonest accountants can cost you thousands of dollars in fees every year.

Typically you can gauge an accountant's honesty by asking him to teach you some basic accounting and bookkeeping skills that you can do on your own. Your accountant shouldn't have any problems teaching you these simple methods to help you save money. If he's unwilling, and you think it's because he wants to earn more money by performing menial tasks, then you should consider letting him go.

Poor Communication

Few people will ever know as much about your life, especially your financial life, as your accountant. Without such intimate knowledge, your accountant couldn't make educated recommendations that will help you do more with your money.

Good communication based on trust, therefore, is incredibly important. If you feel uncomfortable talking to your accountant or you just don't like his communication style, then you should feel free to move on to another professional. You shouldn't expect an accountant to become your new best friend, but you should expect him to provide good information in a manner that you can understand.

Vague Advice

Your accountant needs to give you specific advice that will help you save money. Vague advice like "you need to save more money for retirement" doesn't get the job done. You need specifics.

A reliable accountant should be able to give you advice that considers the advantages and disadvantages of:

Buying or leasing equipment for your business
Saving money in IRA, Roth IRA, and other specific retirement accounts
Reducing your tax burden by finding more deductions
Choosing accounting software for your business

Outdated Advice

Tax laws, tax filing, and business regulations change all the time. Accountants have to keep up with those changes to offer their clients quality advice. Unfortunately, not all accountants are good at learning the evolving tax code and regulations.

If you suspect that your accountant is giving you outdated advice, then you might want to make an appointment with another CPA to see what suggestions she gives you. If you find that her advice is much better and up-to-date than the advice provided by your current accountant, then it's time to move on. Getting outdated advice not only costs you money, it could get you in trouble with the IRS and regulatory agencies.

The vast majority of accountants do their work very well. Occasionally, though, you will find one that doesn't meet your needs. When this happens, you should know the warning signs so you can fire him and move on to someone with better skills.

This article is from Debbie Dragon of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Hire an Accountant

Thursday Bram — Thu, 06 Sep 2012 09:48:41 +0000

When you’ve found an accountant you’re considering hiring, it’s important to do some research. After all, you’ll be handing over a lot of financial data, and you need to know you can trust whoever has access to it. (See also: How to Find the Right Accountant for You)

Checking Your Accountant’s Credentials

Especially if you’re looking for help with a specific problem, it’s a good idea to confirm your accountant’s credentials before you decide to work together. Every state has its own licensing board, most of which let you confirm license details online. You can find a list of licensing boards through the National Association of State Boards of Accountancy.

It may also make sense to check references or testimonials. Talking to someone who has already worked with the accountant you’re considering can help alleviate concerns. You can ask for references. You can also check for online recommendations, such as those that may be posted on your accountant’s LinkedIn profile.

Interviewing Your Accountant

Most accountants will agree to an informal discussion before taking on any new clients, which you should treat as an opportunity to interview any accountant you’re considering working with. Ask any questions you need answered to ensure this accountant is the right one for you, such as:

What type of clients does this particular accountant work with?
How can this accountant help you?
What will this accountant need from you?

Also make a point to ask who will be doing the work at your accountant’s firm. Most accountants who handle personal tax returns and similar issues don’t have a big firm backing them — those big companies that handle massive numbers of tax returns every year usually rely on staff with credentials below those of an accountant. They’re perfectly fine at completing anything run-of-the-mill but may not be able to cope with something more complex. At smaller firms, though, it’s not out of the question that an accountant may rely on some outside help. Some go so far as to have routine work handled by overseas contractors, while focusing on anything more complex themselves.

Make sure you’re comfortable with whatever the answer is. Personally, if I’m paying for an accountant, I’d like to know that he’s doing the work himself or that I can walk into the office and talk to anyone he’s hired. I also want to know exactly who has access to any of my financial data. But that’s just my preference — as long as you trust your accountant and the people working with him, make the choice that feels right to you.

Paying Your Accountant

Even if price is not the foremost concern in choosing an accountant, it is something you want to talk about with your accountant in advance. Get an idea of the basic fees and costs that go along with the type of work you need done.

Provided that you’re only having your accountant handle a few personal matters, like your yearly tax return, your accountant will probably bill you after completing each task. There are some services, particularly for businesses, that an accountant may bill for on a monthly basis.

As long as you feel good about working with the accountant you’ve chosen, you’re pretty much done at this point. From here, it’s just a matter of formalizing your arrangement and letting your accountant get to work.

This article is from Thursday Bram of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Choose a Real Estate Agent

Camilla Cheung — Thu, 26 Jan 2012 11:24:13 +0000

Buying or selling a home is one of the biggest financial transactions you will ever make, and it’s important to have a real estate agent who can give you a true idea of your options, explain the details of the transaction to you, and help to navigate any potential problems. But how do you choose a real estate agent? How do you avoid the untrustworthy agents and find someone who is professional and has your best interest at heart? (See also: When Should You Fire Your Real Estate Agent?)

1. Have High Expectations

If your expectations for a real estate agent are simply someone to chauffeur you to houses and unlock the doors, or someone who will just list your house for you, your expectations are too low, and they will be self-fulfilling. Think of a realtor as a professional, not a salesperson, and hold them to the same expectations that you would hold any other professional, such as a CPA, an attorney, or a doctor. This is the person who will be advising you on how to spend a huge chunk of money. The agent should be able to educate you on your options and help you to understand the consequences of whatever choices you decide to make.

2. Look for Certain Qualities

In the current market, there are few easy deals to be had in real estate. Many transactions, especially complicated ones such as short sales, require someone with the skills and expertise to navigate all of the potential problems. Whether your real estate agent has the right skills may affect whether or not you are able to buy or sell a home at all. Markus Brown, a real estate agent in Orange County, says these are the top qualities you should look for in a real estate agent:

Organization skills and detailed knowledge of the stacks of paperwork and legal issues that are involved
Negotiation skills — someone who can deal efficiently with problems as they come up, who has good people skills when dealing with opposing agents
For sellers, a marketing strategy and experience marketing homes
Excellent communication skills — someone who can explain things to you in terms that you understand, empowering you to make the right decisions

3. Interview Your Potential Agent

Brown says, “Sellers usually interview agents, since they are paying them, but buyers often don’t think of interviewing agents, to their detriment.” Whether you are buying or selling, take the time to interview at least three real estate agents. You can meet real estate agents through referrals from family and friends, or you can find them at open houses. It’s a good idea to visit an open house and talk with a real estate agent face-to-face before requesting an interview. If an agent isn’t interested in being interviewed, find someone else.

Be careful about working with family or friends who are real estate agents. Buying or selling a house is possibly the biggest financial transaction of your life, and you deserve to work with the best person for the job. Family obligations should have no place in this business transaction, and if a deal goes sour, it may cause awkwardness and heartache in the end.

When interviewing a real estate agent, Brown suggests the following questions:

How long have you been in the business?

This is the agent’s opportunity to explain how they gained the skills for the job. How an agent answers this question can provide insight into the way they think and work. Agents who use this question to brag about how amazing they are instead of how they helped buyers and sellers accomplish their goals might be the sort of people who talk more than they listen — a bad sign. Remember, just because someone has been in the business forever doesn’t mean they’re the right person for the job; sometimes someone with less experience can be just as knowledgeable and may have other skills that will be valuable.

Can you describe the process, from start to finish, of buying or selling a house?

How well does the agent explain things to you? Do you have a clear picture of the process, and do you feel empowered rather than belittled? Never work with an agent who talks down to you.

Can you describe how you treat the offer process? How do you submit my offer to the seller? (Or, if you are the seller — how do you assess potential offers?

Does the agent present offers in person? Do they try to meet with the listing agent to establish a good rapport? How will the agent discuss potential offers with you, and what strategies do they have for responding to offers?

4. Look for Red Flags

At the end of the day, you have to decide whether you feel comfortable working with a particular real estate agent. If something about them feels untrustworthy, go with your gut and look for someone else (there are plenty of agents out there). Be especially wary of working with the following:

Agents who talk more than they listen, or talk about themselves more than they listen to you.
Agents who are part-time — either they can’t cut it in the real estate world and have to hold on to a day job, or they won’t have the detailed knowledge and expertise of someone who makes it their primary business.
Agents who are desperate for your business. If they are trying too hard to gain you as a client, chances are they will not give you objective advice. An agent who wants to close the deal too much may pressure you into something you aren’t happy with.

Have you had a good experience with a real estate agent? What qualities made that agent successful?

This article is from Camilla Cheung of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Avoid Moving Scams

Chris Birk — Thu, 26 May 2011 10:24:20 +0000

Moving is awful. More than 40 million moves occur each year, according to the U.S. Department of Transportation. Paying someone to handle most of the heavy lifting can be a great way to ease stress and tension. (See also: The ABCs of DIY Moving)

But it can also create a fiscal nightmare for consumers who aren't careful. Moving scams are increasingly common and can cheat unsuspecting consumers out of thousands of dollars in unnecessary fees or even result in lost or damaged items. Sleazy companies and below-board movers use an array of tactics to trick or deceive people, from phony estimates to charging huge deposits that they rarely return to the owner.

Education and common sense are the key tools in the fight against moving scams. Homework and due diligence aren't always at the front of mind for homeowners and apartment dwellers planning a major relocation. But a few simple steps can make a tremendous difference.

Here's a look at a few tips to help ensure you're safeguarded against unscrupulous businesses and skeezy opportunists.

Perform a Background Check

Before you even talk with potential movers, search the Better Business Bureau for jeers and cheers. This is a quick way to weed out companies that received more complaints than praises. You should go a step further and obtain at least three references from the companies you're considering. These should be local folks who can provide honest feedback on the company and its services. You can also talk with friends and family about movers they’ve employed. Check with the Department of Transportation to find out if the company is licensed and bonded.

Pay the Right Price

Be suspicious of ridiculously low estimates or demands for a large deposit up front. Scammers frequently use both tactics. Ask moving companies what specials they’re offering and plan to line up three companies. Get quotes from all three, but it tell them why you might choose a competitor. This way you can negotiate a lower price. Give the companies as much detail as possible about your belongings and make sure you get a thorough estimation. The last thing you want is a mover holding your stuff hostage until you fork over a wad of bills.

Get It in Writing

It’s useless to get a verbal quote. Make sure to get a company’s quote on paper. You’re then protected legally, as it’s illegal for the movers to charge you more than 10% over what they quoted in writing. Any moving company that will not write down a quote will likely cause a headache. Have quotes broken down to every last detail: cost of weight, item conditions, and pickup and delivery dates. Ask the movers to estimate and record extra charges like truck weight, gas, and customs and convenience costs. Most importantly, get a not-to-exceed price on the written agreement.

Take Inventory of Your Possessions

Although this sounds like a painstaking task, it’s worth it. Insure everything you plan on moving. Pictures and lists of everything help in the instance that you need to file a claim with the insurance company.

Prepare for the Big Day

Confirm the address, time, and day of pickup and delivery several times with the moving company. Get the names of who will be picking up your belongings. When they arrive, ask for their names and paperwork that proves they’re your movers. The last thing you want to do is turn over your prized possessions to scammers.

This article is from Chris Birk of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Identifying Good Managers Through Leadership Competencies

Patricia Lotich — Tue, 01 Mar 2011 19:17:49 +0000

Link:

http://www.openforum.com/idea-hub/topics/managing/article/identifying-good-manag...

Managers need to have certain competencies to effectively influence the behaviors of others and ultimately achieve desired results. Some competencies come naturally, while others need to be learned and practiced. Organizations should have defined knowledge and skill requirements for their leadership team so the organization is managed from a consistent proficiency platform.

It is common for large organizations to have required competencies that are aligned with management-development training programs. These organizations often have in-house training departments that help develop employees by providing training in all required competencies. Small organizations should spend time thinking through desired competencies and identify appropriate training options, such as for these 12 common leadership competencies:

1. Interviewing and Hiring

Leaders and managers need to understand the basics of interviewing and hiring. It is important to be prepared for interviews by becoming familiar with the job requirements and candidate qualifications. Being able to identify the right fit for open positions helps ensure the organization secures the best talent.

2. Delegation

Delegation is an art that leaders need to master. This can be difficult for the new manager because it requires handing responsibilities off to others. Learning to trust others to perform tasks takes skill and practice. Once learned, delegation can be very liberating for a manager and allows the manager to perform higher-level tasks.

3. Supervising

This is often a challenge for someone who has not had management experience. Training on what to do and what not to do when managing others can help minimize issues related to supervising skills.

4. Conflict Resolution

Conflict in the workplace is an inevitable reality. When not managed properly, conflict can affect relationships between individual people and groups of people. Leaders should be able to manage conflict and help influence win-win situations. This can be done by negotiating and collaborating with all parties.

5. Emotional Intelligence

Emotional intelligence is a leader’s ability to manage his or her emotional response to people and situations. Emotional intelligence is a mark of professional maturity that can be learned, but can take years to develop and a lifetime to master.

6. Communication Skills

Managers need to have good written and verbal communication skills to effectively communicate with employees. There also needs to be structured organizational communication processes that all employees understand to ensure information is filtered throughout the organization.

7. Team Building

Leaders need to be able to build strong teams that rally around the vision of the organization. Leaders must understand how to manage team dynamics, team development, and team conflict.

8. Motivating

Leaders need to understand what inspires and motivates employees. There are many different motivation models that can be incorporated into a manager’s strategy for employee motivation. It is important to remember that we are all motivated by different things. The trick is to identify what motivates employees and develop systems and processes that support those motivators.

9. Coaching

Being a good coach can be one of the most rewarding aspects of managing others. Helping employees build on strengths and improve weaknesses is an integral part of the professional development process.

10. Performance Management

Managing performance is critical to meeting corporate objectives. Managers need to be able to set expectations, write goals, hold employees accountable, and reward employees for good performance. This also includes coaching and disciplining employees when necessary.

11. Problem Solving

Managing people and processes requires problem-solving skills. Problems could be with employees, work processes, or product quality. Management must understand basic problem-solving techniques, be able to identify problems, and facilitate a process to resolve issues.

12. Agent for Change

Progressive organizations understand that change is constant and that in order to move forward, organizations need to continually improve what they do and how they do it. Organizations are being forced to make dramatic improvements, not only to compete but to survive in today’s economy. Therefore, leaders need to be able to lead the charge on change initiatives.

Employee performance is how corporate objectives are met. Having the ability to identify specific leadership competencies can help create an environment that motivates, develops, and manages employee performance.

This article is from Patricia Lotich of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Who Should Handle Your Business Finances

JoAnne Berg — Sat, 29 Jan 2011 21:09:20 +0000

Link:

http://www.openforum.com/idea-hub/topics/money/article/who-should-handle-your-bu...

Every business has a Chief Financial Officer — the person who has overall responsibility for the financial management of the company. In your business, that person might be you!

Here are some of the responsibilities of the CFO:

Financial control over assets
Internal control systems
Bookkeeping
Financial accounting
Cost accounting
Financial reporting
Operational reporting
Tax compliance
Investor relations
Lender and banking relations
Cash management and cash flow forecasting
Budgeting and financial planning and projections
HR and payroll
Insurance and risk management

In a new business, it is not uncommon for the owner to take on all of these duties, but eventually you’ll need to start delegating some of them.

Bookkeeping and accounting are both part of the financial-management process. While every business is somewhat different, here is a typical small-business scenario to illustrate the relationship between them:

Bookkeeping

As businesses grow, many owners look forward to hiring a bookkeeper. This makes sense — handling the day-to-day bookkeeping is probably not the best use of your time. A good bookkeeper will have specialized training and several years of experience in using the accounting software that your business uses. He or she should also have some basic knowledge of double-entry accounting, but an accounting degree is not required.

Your bookkeeper will be responsible for accurately and completely entering all of your day-to-day business transactions into the software. Bookkeepers also typically write the checks and handle the payroll. Depending on the type of business, they may also do the invoicing and handle the accounts receivable and cash receipts.

A certified full-charge bookkeeper will also be able prepare your monthly and annual financial statements using the accrual basis of accounting. However, not all bookkeepers are qualified to do this, and most will need to consult with your CPA on how to properly account for difficult or unusual transactions.

As accounting software packages have gotten easier to use, the barriers to entry in the bookkeeping field have gotten lower. Anyone can call himself or herself a bookkeeper, and seasoned CPAs can tell you many horror stories about the results of unqualified personnel “keeping the books.” To avoid this, ask your CPA to help you ensure that the person you are hiring is qualified, and be careful about promoting someone into that position who has not done it before. It’s not as simple as it looks!

Finally, once you start delegating financial tasks, internal control systems become very important, so consult an expert to help you set up your policies and procedures so that your financials are correct and your assets are not at risk. For internal control reasons, your bookkeeper should not be authorized to sign checks, and if they are reconciling the bank accounts, you or your CPA should review the reconciliations each month.

Accounting

Accounting is less concerned with data entry at the time of the transaction and more concerned with the analysis of that data and the preparation of managerial and financial reports, which are used to run and grow the business.

During the early years of your company, you will rely on your outside CPA to provide you with the sophisticated accounting, tax, and financial advice that your bookkeeper is not qualified to provide. As your business continues to grow, you will eventually hire a degreed accountant to oversee your bookkeeper and handle more sophisticated financial and accounting tasks. This person should also take on the controllership function for your company, which means they will handle banking relationships, cash-flow projections, budgeting, cost accounting, tax compliance, and other higher-level responsibilities.

Your controller should have at least a four-year degree in accounting, financial management experience in your industry, and preferably a CPA or CMA (Certified Management Accountant) designation as well.

Financial Management

Eventually your company will require a Chief Financial Officer. Many businesses start out with a part-time CFO. There are many highly qualified professional CFOs with years of experience who provide this service. They can help with strategic planning, obtaining financing, interfacing with investors, providing training and support for your other financial staff, and helping you look at your business in new ways.

Good financial management has saved many floundering businesses, and the ability of a professional CFO to analyze the situation, provide projections, and model alternative business plans can go a long way towards satisfying lenders and investors if things get tough.

You’ll know you’re on your way to success when you are able to hire a full-time CFO to oversee all of the financial management responsibilities of your business. In addition to allowing you to focus on other parts of the business, a good CFO will serve as your partner in driving business success and creating long term business value. Enjoy the journey!

This article is from JoAnne Berg of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How Much to Pay New Hires in 2011

Elaine Pofeldt — Sat, 15 Jan 2011 13:54:22 +0000

Link:

http://www.openforum.com/idea-hub/topics/money/article/how-much-should-you-pay-n...

Ready to make some full-time hires in 2011 so you can grow your business? You’re not alone. Several recent surveys show that small businesses are thinking about hiring once again.

Like many entrepreneurs, you may be wondering how much salary to offer in today’s job market. Overpay new employees, and you’ll soon find yourself with unsustainable overhead — especially if the economy falters. Shortchange your recruits, and you may breed resentment. Here is some advice from compensation experts on how to strike a balance.

Do a Reality Check

While you might dream of building a team that has worked at multinational corporations, doing so may not be necessary for your small business. “As a company you need to look at what you can afford and what level person you need for a position,” says Rob Wilson, president of Employco USA, a human resources outsourcing firm based in Westmont, Ill.

That said, depending on your industry and region, it is still possible in today’s job market to attract talented candidates who earned more elsewhere but want benefits that a small firm may offer, like better work-life balance, says Wilson. “At the mid-level, you’re seeing huge salary changes for people,” he says. In one search to fill a human resources position paying $75,000, he recently saw applications from candidates who had earned around $150,000 previously. Bear in mind that if you hire people for a fraction of their previous salaries, you may lose them once the job market picks up, says Wilson.

Know the Going Rate

Wilson recommends looking at Salary.com to learn current salaries in your industry and region. Other good sources of information on compensation are trade associations. Resources include the Society for Human Resource Management, which researches salary trends, and WorldatWork, a not-for-profit focused on global human resources issues, says Priya Kapila, a St. Louis-based consultant at CBIZ Human Capital Services, which does human resources consulting.

Still not sure how much to pay? There are many human resources consultancies that can help you. Ask for a “market pay assessment,” advises Kapila. Costs for such a report, says Kapila, range from very minimal to several thousand dollars, depending on your needs and the consultancy’s rates.

Consider Supply and Demand

The unemployment rate among those with a bachelor’s degree or higher was 5% in November 2010; for those with a high school diploma, it was 10%. What does this mean for you? If you need a highly educated, professional-level employee such as an accountant or chief technology officer, be prepared to pay a very competitive salary. “For the C-suite executive, you may really want to target that median competitive pay rate,” says Kapila. “You want someone who is qualified and can start the job running. For a lower-level or support-type position, it may be less important that you’re bringing in the best of the best. You can focus on something lower in the range of what is competitive and reasonable.”

This article is from Elaine Pofeldt of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Overwhelmed trying to find good help? Three easy steps to qualifying a professional

Julie Rains — Sun, 03 Jun 2007 18:28:16 +0000

Ever wonder how to make a call to a professional that helps you figure out how the pro does business and get a fair (though not rock-bottom) price while building rapport with your pro and not alienating someone who could help you with quality service (who could save you lots of money and grief in the meantime)? You may be hiring a building contractor, website designer, childcare provider, or CPA -- this guide gives you a great way to start the qualification process.

I’ve provided business writing services for over 10 years and fielded lots of inquiries. Here’s a guide to not asking annoying questions but still get the information you need:

What you might have said before reading this three-easy-steps guide: How much is an XYZ project (e.g., kitchen remodel or website)?

What the pro hears: Price is my only concern. I know absolutely nothing about purchasing this service, haven’t bothered to do any research, and you will spend lots of times educating me and selling me on your price.

What you should say instead (with or without having done research): Can you tell me about your service and your pricing?

What you might have said before: This will be an easy project.

What the pro hears: I want you to do this project right away as you can easily work it in to your schedule because it’s so simple. (Or, I’m high maintenance but I think I’m low maintenance.)

What you should say instead: Can I tell you about my project?

What you might have said before: I already have a lot done.

What the pro will hear: Not only will you have to do the work you normally do, you’ll have to fix what I did wrong. Still, I’m expecting a lower price since I’ve saved you time.

What you should say instead: Will it help any if I have already done X (selected my cabinets or designed the navigation)?

Note: If you get irritation instead of cooperation, you haven’t found a pro and need to make another call.

This article is from Julie Rains of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: