You are the author of your companies books!

A nice feeling to me is when I know the financial books are in order. Once all the data is entered to date, all accounts are reconciled and reviewed, I’m confident that the reports are telling the true story of a companies’ wealth.

One reason I like accounting is that everything has to balance. If the bookkeeper/controller is true to her/his work, they will work to make sure everything balances to the penny. You just never know when a $1.00 adjustment is really a combination of errors resulting in a net difference of $1.00.

Once you know that things are caught up and in balance, it’s time to read the reports that tell the story. Learn to read the following reports:
• Balance Sheet
• Profit and Loss aka Income Statement
• Statement of Cash Flow
• Subsidiary reports which may list out items that are shown as totals on the Balance Sheet

Once you understand these reports, you open the book of your company… the General Ledger, this is where the detail is.

And your companies story goes on year after year….

Tofu with Peanut Sauce

In my last entry, I mentioned that I would send you a recipe. Recently, my favorite dish is one I made up but I absolutely love it. I'm trying to stay away from meat. After seeing the movie "Food, Inc" I try only to buy organic meat, but that can be expensive, so I've been eating more tofu and tempeh.

Tofu with Peanut Sauce (spicy)

Saute garlic and sliced onions
Add Tofu (cubed, firm)
Add Shredded carrot (I used my potatoe peeler to shread it)
Peanut sauce (I add liberally, but it might be spicy if you do)

Saute the tofu long enough to get it browned and simmer with the peanut sauce long enough to allow the tofu to absorb the flavor.

I have had this at a restaurant and it includes broccoli and cabbage so you could add any vegetables that you like.

Serve over rice.

Kicking it up

I have decided to kick this blog up a few notches. Let's face it, accounting is boring. If you need help with accounting the best bet is to contact me, schedule some one on one time together and nip your fear of accounting in the bud, or call me and have me do it for you. So...I have decided to include in this blog, some everyday tidbits of my life as a small business owner and under-employed accountant/business consultant.

Yes, that's right, business is so slow that I cannot maintain just with Success In-Formation LLC. I have been hitting the pavement, both literally and the cyberspace pavement, looking for a job. A job that includes benefits so I don't have to wait two years for the government health insurance option (cross our fingers on today's vote).

Back to the blog, I am going to offer interesting information other than accounting, I need to hear from you if you like it, that will determine the direction of my blog. Today I'm making a vegetarian dish with tempeh, kale, sweet potatoes and marsala wine (I'm making it up as I go) If it's good, I will tell you about it. If it's not good, I'll tell you about a different recipe maybe.

If you like this blog, please share it with your friends, the more hits I get, the more traffic to my website and maybe I'll get some much needed income.

I will still offer accounting and business tips, but they will just be a part of this blog, not all of it. Thanks to Cheryl from metro Detroit who called today for QuickBooks help. We will do a short (1.5 hrs) session tomorrow on line. Yes, that's right, I work on Sundays!

American Contractor by Maxwell Version 8.1

What a nice upgrade we now have in American Contractor. New features like the ability to create your own screen views, filter by any field "easily" (you could do it before but now it is much easier) and the cleaning up of many reports and adding new reports, like number S0571 (billing form for AIA type invoicing).

If you are an American Contractor User, it is definitely time to perform the upgrade. The program is stable and much much nicer than 7.8. When you do, your first step should be to go into each "center" and click on View: Customize Current view. You can add calculated fields to your views as well as simple changes like rearranging columns and deleting columns you don't want to see. No more seeing unnecessary fields (like state and zip) on a daily basis unless you really want to. To me, it was wasted space better used for something like "user defined: job type" or "last receipt date".

And if you aren't using info center yet, you will need to now. Drop and drag your outlook contacts into AC and it will create a contact for you in AC that you can use for any purpose, maybe for a "bidders list". Drop and drag your outlook emails into AC and attach them to a job.

For me, attaching invoice PDF's to jobs is a lifesaver for looking up information. And if you are using efax, they already come to you in fax form, so it's so simple to attach the pdf, you don't even need to scan them. But scanning with info center is a piece of cake. One example of the time saving of doing this: a job is a cost plus job, when it comes time to do an invoice, you are required to submit copies of vendor invoices. Now, just go to the job record, click on info center and there they are, waiting for you to print them to send with the invoice.

All in all, Maxwell has shown that they have the resources and the desire to stay in the market for the long haul. While we are in an economic downturn, they are using this time to improve their product for contractors who are also, in it for the long haul.

New Video on QuickBooks Preferences

Multi-currency functionality

Beginning in 2009, QuickBooks added the feature of having Multi-Currency functionality in their software. I must say, Intuit really surprises me with what they do with QuickBooks. It has come a long way from what it once was. With this feature, you choose your preferred currency when setting up your company. You set exchange rates for different currency types that your customer or vendors may use and as you set up your vendors or customers, QuickBooks asks you for their rate and converts the currency to your rate.

Today, I did a bit of research for a company in the Dominician Republic who's default currency is Pesos. I researched for a software that would work in conjunction with QuickBooks to allow the user to understand the English words that the program uses, such as "transaction", "vendor" "general ledger", etc. I did find a software that will provide "pop ups" to allow a person who speaks Spanish to understand QuickBooks.

It always amazes me how much is available via the Internet. The world has become a smaller place and I like it that way.

Now....to just get a trip to somewhere warm in February instead of working on-line from the cold north!!

Let's Get Organized - Accounts Payable

Accounts Payable aka Vendor Bills

1. When bills come in the mail, code them with the job and code (roofing, siding, etc) and enter them daily into your accounting software as an accounts payable bill.
2. File them in an A-Z accordion folder that is labeled "Accounts Payable or Bills to Pay".
3. Twice a month (weekly or monthly) when it's time to pay bills, print an open payables report to choose what you want to pay, pull the bills from your blue accordion folder and select the bills in your software to be printed.
4. Print checks using three part checks (body, stub, stub or similar). After checks are printed, use window envelopes to mail the checks to the vendor.
5. Staple the bottom stub from each check you printed to the group of bills they are paying.
6. File each vendors paid bills (with check stub attached) in the appropriate "paid bill file folder" (see below).

This may be contrary to what many contractors want to do, but something I highly recommend. Job reports can be printed for the job file showing all job costs including paid and unpaid bills and more. By stapling all bills together with the check stub, they are all in one place and you can always go to the same location to find them. Waivers if printed with the bills can be filed in the job folder, or even in the paid bill folder. You will know where to get them if you need them, many times, you won't need them unless liens are filed. At the end of the year, the paid Bills folders can be stored away and new file folders created for the new year.

File paid bills in file folders labeled for each letter and/or for your major vendors:

"ABC Electric, Paid 2009"
"A-Misc, Paid 2009"
"B-Misc, Paid 2009"

Email sarah@successif.biz if you would like a word document ready for printing onto labels of your "Alpha- Misc Paid 2009" file folders.

Getting to 100% Complete on Jobs

Following is a repost of an earlier blog post, I have many contractors ask about this process:

Most software written for construction will automatically calculate a percentage complete on a job. This percentage is a percentage of actual costs to the job budget. If you haven't entered a budget, most software will calculate the percentage as 100% because it will assume your budget should be what your costs are. The way to avoid this problem of course is to be sure you enter a budget for every job.

Another challenge in construction is to get the calculation to 100% complete when the job truly is complete. It is rare that a jobs cost is equal to its budget. There will most always be a slight variance. I recommend the following when a job is complete.

1. Set up a cost code or tracking code called "over/under budget".
2. Review the job (see previous blog) to be sure it is complete.
3. Enter an internal change order (which only posts to budget, not to contract amount) for the amount of the difference so that you force the budget to equal the final costs.

Be sure to record the amount in #3 to the code called "over/under budget", this preserves your original budget figures and also allows you to see your "over/under budget" amount by job at any time which would be a great report to view by Project Manager, Estimator or Crew Leader over a specific length of time.

Taking the next step

You've purchased new accounting software, you may even have integrated estimating software and may be sending your bids from the estimating package to the accounting package. Wonderful, you have done well. Now you are ready for the next step. Some of the setup procedures that sometimes take a back seat to be done later may need to be reviewed. Now is a good time to choose one more task to get you closer to your goals:

• General Ledger Budgets - set up projections for income and expense accounts to keep the numbers in check and make it easy to review on a monthly basis.
• Statement of Cash Flow - is it set up, do you know how to read it?
• Fine tune your Chart of Accounts - get rid of accounts that were ".. in your software" and are not used by your company, summarize some accounts so that your income statement is clean, or your balance sheet includes totals of all vehicle loans allowing you to refer to supporting schedules for a detailed list.
• Do you have a remote data backup procedure in place? Put the responsibility in a reliable companies hands to be sure you have a good backup on a daily basis. The benefit far outweighs the cost.
• Is your equipment in good shape and up to par? RAM is very inexpensive these days, good network cards are worth their weight in gold and also inexpensive.
• Is it time to review jobs that need to be closed? Set up procedures for reviewing closed jobs and mark them closed in your software.
• Are you current in your monthly closings? Are procedures written down? Does everyone know their duties as it relates to this important task?
• If you are using QuickBooks, are your items clean and directed to the proper GL accounts.
• Have you scanned your logo and are you using it on your reports? Do your reports look like you want them to look?