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Accounting Questions

Payroll Questions

Why should I choose a monthly accountant vs. less frequent methods of accounting?

Monthly accounting services provide substantially more value than only an annual service. If an accountant only sees your numbers once a year, it is too late to offer advice that would have helped to make that year more profitable. And definitely too late to lower your tax liability for a year that is already over with. This blog post explains five ways monthly accounting pays for itself: 1) It saves you time, 2) You get regular business profitability advice, 3)You have peace of mind that your finances are handled, 4) Your tax liability is reduced, 5) You can make more proactive financial decisions. Read more here.

How can I transition from in-house to outsourced accounting?

Transitions are tricky, but preparing your business to switch to an outsourced accountant doesn’t have to be hard. Make your new financial partner is a good fit, plan ahead and be sure to budget enough time, set goals, and be mindful of potential obstacles. Read more tips here.

What are the best ways to separate my business and personal finances?

Mixing business and personal finances is a major problem for small-business owners. Not only does it create headaches at tax time, it also makes it difficult to track the profitability of your company. Worse-case scenario: you get audited by the IRS and end up with major fines. Keeping these two parts of your money life separate is essential to preserve your sanity and to ensure you have a sustainable business model. Here are some tips to help you divide the two.

How can I tell if I've outgrown my current accounting firm?

As your business expands, your financial needs and concerns are going to be dramatically different than they were even a year ago. There are three tell-tale signs you’ve outgrown your firm: 1) They can’t help you when you need to borrow money or expand your business, 2) They can’t provide advice for your business plan or expansion goals, 3) They file something incorrectly because it was too complex. Read more about these three warning signs here.

How does better accounting affect my bottom line?

Many small- and mid-size businesses fail to adequately measure and manage their finances, even though poor financial management is a major cause of business failure. If you don’t have good financial practices in place, your business could suffer in a number of ways, including lost revenue, insufficient tax planning, and missed financial opportunities. A great monthly accounting service will handle your profit and loss statements, monthly balance sheets, and regular account reconciliation to help you take back control of your finances without much effort on your part. Read more here.

How can I make my new business financially successful?

It depends. We’d be happy to have a brief consultation to provide personalized financial advice for your new business, but at a high level, you need three things: a strategic plan, consistent accounting records, and expert advice. Read more about these three elements of financial success here.

What questions should I ask when choosing the right accountant for my business?

Working with a professional accounting service offers you security and peace of mind. It’s a smart business choice for your company, but you need to decide which accountant or accounting firm is right for you. This blog post offers 12 questions you should be sure to ask when choosing an accountant.

Is my current accounting firm providing quality service?

Use this checklist to evaluate whether your current accounting firm is providing quality service or read this blog post: 6 Signs Your Monthly Accounting Service Isn’t Delivering.

What should be included in my profit/loss sheet?

You should include items from a few categories: revenue, cost of goods sold, cost of labor, and operating expenses. Read more here.

How much does monthly accounting cost? What factors go into the pricing?

Pricing for our monthly accounting services varies by your company’s needs. Our pricing is not based on the size of your company, rather our pricing model is based on your company’s accounting activity and the complexity of your financial statements. We will work with you to arrive at an affordable, fixed monthly fee. Our fixed-monthly fees are all-inclusive; services provided include profit and loss statements, balance sheets, bank reconciliation, business tax work, sales tax filings, audit representation, and unlimited consultations.

What makes you different than other monthly accounting services?

Our customer service sets our firm apart. We make it our priority to reach out to clients on a consistent basis because we care about the success of your business. Our experienced team of accountants also provide proactive business advice and tax planning, allowing you to maximize your profits.

What do your clients need to provide you with in order to do your job?

To efficiently help you with your business goals, we require access to your source documents -- either in electronic or hard copy form. Common documents include, but are not limited to, bank statements, credit card statements, sales systems (POS), software (i.e. Quickbooks), inventory, accounts payable, and accounts receivable. Depending on your level of expertise, we will train clients on how to prepare these documents. What we require from you will be customized to your unique business.

What does the monthly accounting process look like?

Our monthly accounting process starts with receiving your source documents. Our staff compiles the information and reports back to you with a profit and loss statement, balance sheet, and general ledger. These monthly financial reports are presented in digital or hard copy form and become the foundation for our monthly conversations.

Why hire a monthly accountant instead of an annual one?

Truthfully, not all business owners see the need, but our clients sure do! We provide consulting and business advice throughout the year. Our proactive approach allows you to see trends earlier, and spot any issues before they become larger problems. Monthly financial statements are a tool to stay on top of your business, which allows you to focus on growing your profits.

When should I consider outsourcing my accounting?

If your business is too small to hire an in-house accountant or you simply don’t have the desire to do it yourself, you should consider outsourcing the task. While QuickBooks is used by many small-business owners, the software can be more complicated than first realized. By outsourcing your accounting, you free yourself to focus on other aspects of your business.

What accounting system do you use?

We primarily use two systems: Creative Solutions Accounting and Quickbooks. That being said, we will work with other systems depending on your preferences and needs.

Can business owners do part of their accounting themselves (i.e. pay some vendors) and they do the rest (bank reconciliation, etc) through the same system?

We recommend handling the day-to-day bookkeeping aspects of your business that need immediate attention. These reports will become the basis for the source documents we will ask of you.

Is my current payroll firm providing quality service?

If you’re deciding whether or not to switch payroll providers, consider this checklist for evaluating payroll services.

How much do payroll services cost? What factors go into the pricing?

Pricing for our payroll services includes a base fee which is based on the frequency of your payroll, a fee for each employee, and the number of W-2s that need to be filed. Other contributing factors include garnishments, new hires, and if you're doing business in other states.

What do clients need to provide in order to process my payroll?

We'll need the information found on each employees' W-4. Also, information about how you pay each employee (i.e. hourly, salary, commission), and if you provide bonuses. Lastly, we would need to know about any recurring voluntary or involuntary deductions from employees' checks and in some cases, whether they are qualified pre-tax deductions or not.

What do your payroll processes look like?

After you provide us with the basic information, we do the rest. Everything is scheduled electronically for direct deposit accounts or we provide you with checks. We automatically calculate and schedule payroll taxes electronically from your business account. We will also submit your quarterly tax reports and annual returns including the W-2s.

What are the advantages of outsourcing payroll to a service provider?

Outsourcing payroll saves time and money. It is actually less expensive to have an outside service process your payroll when you factor in all the variables. You also get the peace of mind of having a payroll professional making sure that you are in compliance.

What makes CSI different than the national payroll providers?

With CSI, you work with a specific processor who is assigned to your account. Your dedicated processor will become familiar with your account and it will be like working with your own employee. You will get customer service that only comes from working with a small business, like yours.

What do I do if I receive a letter from the IRS or other payroll taxing authority?

CSI Payroll clients need only to send taxing authority correspondence to their dedicated processor. We handle it from there. Once we have looked into the matter, we will notify you as to why it was sent and what action, if any, is needed.

What do I do if I receive a child support or other garnishment orders on my employee?

CSI Payroll clients need only to send garnishment orders to their dedicated processor. We handle it from there. The order will be followed as required by the law.

How do I get the payroll reports that I need for my worker's compensation audit?

Let us know what your policy period start and end date is and we can produce customized reports for that time period. We can also conduct the audit at our office. Just let your auditor know that you want the audit to be done at our office and they will contact us to schedule a time.

When will my FICA/witholding payroll tax deposits be paid?

We schedule our clients' state and federal FICA/withholding tax payments on the IRS's semi-weekly deposit schedule. This means that if your payday falls on a Wed, Thu, or Fri, the deposits will be on the following Wednesday. If your payday falls on a Sat, Sun, Mon, or Tue, the deposits will be on the following Friday. Some exceptions may apply.

When will my unemployment payroll tax deposits be paid?

We schedule the state and federal unemployment tax payments on the last business day of the month following the quarter. Generally, these dates are Jan 31, Apr 30, Jul 31, and Oct 31. Some exceptions may apply.

How is my Minnesota state unemployment rate calculated?

Minnesota unemployment rates are calculated once a year and are based on a 4-year lookback period using a ratio of the amount of benefits paid out to the amount of taxable wages during the same period. The formula is provided when you login to your unemployment online account at uimn.org.

What are the current state and federal minimum wage rates?

Federal minimum wage is $7.25 per hour; however, Minnesota has a higher rate of $9.00 per hour, so the state minimum wage takes precedence. There are some exceptions for small employers that don't engage in interstate commerce and for teenage employees. Learn More

When do I need to pay overtime to my employees?

Federal law requires overtime pay of at least 1.5x regular rate for any hours worked over 40 in your regular workweek. There are exceptions for small employers that don't engage in interstate commerce. Learn More

How do I know if I should pay my worker as an employee or an independent contractor?

If you're not sure, the best thing to do is treat them as an employee. There is a Form SS-8 that can be submitted to the IRS and they will determine the classification of the worker for you. The factors involved are in three basic categories, which are behavior control, financial control, and relationship of the parties. Learn More

What can result from misclassifying an employee as an independent contractor?

If an employer is found to have misclassified an employee as an independent contractor, they will be required to pay income tax withholding at 1.5% of the wages paid and 20% of the wages that would have been subject to social security. If the employer also didn't file a 1099 for that worker, the percentages double.

How would a taxing authority know if I misclassified an employee as an independent contractor?

There is a number of instances that could trigger an audit concerning misclassifying an employee as an independent contractor. They include but are not limited to the following: a worker reports the employer to a taxing authority, the worker gets hurt on the job and wants the company's workers compensation to handle the claim, or the worker files for unemployment and lists the employer as a previous place of employment.

Accounting & Payroll Questions for Restaurants

How can I manage my restaurant finances more successfully?

Three ways to improve restaurant profitability are to: 1) maintain monthly financial profit and loss statements, 2) report food and labor costs on a weekly basis, and 3) count and compute inventory on a weekly or monthly basis. Read more about how these best practices increase financial transparency and profitability here.

Why is it important to track "key performance" metrics at your restaurant?

With so many moving parts involved in operating a restaurant, calculating and reviewing performance metrics over time is a way to spot negative trends and identify areas of improvement. It’s especially important for restaurateurs who don’t play a hands-on role in the daily activities of running the business. Read an example that illustrates the importance of tracking key metrics here.

Am I ready to open a second restaurant?

Positive cash flow doesn’t mean you’re ready to expand your business. You need to consider your restaurant strengths, potential for business duplication, the new location, and possible risks. Read this blog post for more detailed considerations.

How can I boost my restaurant's sales?

One way to boost sales is to start looking at your expenses as investments. Many family-owned restaurants cut back on expenses when sales are low, but more often than not, we see those folks struggle to bounce back. Shifting your perspective on expenses can help you focus on the expenditures that will come back to you in increased sales. This blog post offers some ideas on the investments that tend to result in high returns for our restaurant clients.