I’ll never forget when I first started my bookkeeping practice back in 2001 and I first started working in QuickBooks. I had never even looked at it, let alone touched, QuickBooks in my life before. I had always worked in high end software like Mas 90, Platinum and SBT. I think I even learned Peachtree in college – the DOS version of course – nothing in comparison to QuickBooks.

I have been certified as a QuickBooks Pro Advisor since 2002. Currently I am the top Advanced Certified Advisor in Hartford, Connecticut. So many people have asked me, is this a real benefit? The answer is, of course it is. Many business owners have now switched over to QuickBooks from their old software systems. It has become one of the most popular accounting softwares for small businesses. Becoming a QuickBooks Advisor was one of the first things I did once I figured out where I wanted to go with my business. As it turned out, it was the best choice I could have possibly made. It has been one of the best referral sources for new business.

Some of the benefits are:

You get unlimited tech support.

You always have the latest and the greatest software, so when you take on a new client that has the latest software release you will already have it since you get it before it comes out in the market.

You get a listing on the Pro Advisor website. This list now also opens when you look up questions for help in QuickBooks 2008 so potential clients know how to find you.

You get product discounts.

Some things you may want to consider are:

You will need to put aside some time to take the certification exam and pass it. If you get advance certified it could take up to four days to pass the exam. Currently I am certified in QuickBooks, Enterprise, and POS and I am current on all certifications. You can imagine how much time that took.

Instead of doing more bookkeeping you could end up becoming more of a consultant which means you will have to learn the new technology.

It also means that your firm will be specialized in one software, so if the market share changes it could effect you.

Whatever you decide, QuickBooks currently has the majority share of the market. The value you pay is well worth the return in my opinion.

To sign up today for the QuickBooks Advisor Program click here.

Welcome if you are joining us for the first time and Welcome Back to our regular readers! This week it’s me Linda writing to you from my deck enjoying this beautiful fall day.

With September almost at a close, my thoughts have turned towards preparation for year-end planning for my own company as well as those of my clients. It might have been that LL Bean Christmas catalog I received in the mail today. None the less the end of the year will be here in a blink of an eye. Over the next two weeks make sure that you schedule some time in your calendar to do some year-end preparation for your business as well of those of your clients. Remember 1 hour of planning equals 3 hours of production!

Financial forecasting reminds me of the weather – you make your forecast at a moment in time based upon the information and assumptions available, you draw a conclusion and state your forecast.  But then, the information changes and it is now raining and you are caught without your umbrella!

Forecasting, unlike the weather, isn’t a science but it is not pure guess work either.  It is:

1. A combination of knowing your business;
2. Understanding your market place;
3. Knowing what you want to accomplish in the future, and;
4. Common Sense.

Every small business will need to make reliable financial projections at one time or another.  This forecasting is critical at many stages of a company’s life span:

1. When looking for financing
2. Gauging the potential profitability of a new product or service
3. Trying to determine the impact of staff expansion or cutback, or;
4. When it needs to assess other important business decisions.

But let’s take it one step at a time – creating an accurate forecast for the remainder of the year.  There are a lot of components to think about when forecasting and it all boils down to the following five steps:

1. Review Actual Year-To-Date Results

The best place to start is to see where you have been.  If you use an accounting program like QuickBooks you can print out a Profit & Loss statement showing year-to-date results.  Make sure that the statement captures all financial transactions that have occurred to the date of the report and reconciles to your bank statements.  If you don’t use an accounting program, then add up your year-to-date cash receipts from customers and total expenditures.  Take the difference and this should equal your profit or loss.

Examine each line item to make sure that it makes sense – is your year-to-date revenue figure where you thought it should be or has it fallen short?  Are expenses higher than they should be for this time of year?  This exercise will really get you thinking about your business!

2. Establish Goals and Incorporate into Your Forecast

Now that you have seen where you have been, what is it you wish to accomplish by the end of the year?  Launch a new product or service, increase revenue on existing products or services, decrease spending, hire a new employee, launch a marketing campaign which will position the company for the beginning of next year?

Whatever your goals are write them out and then decide on the most important three (3) to five (5) goals you wish to accomplish by the end of the year. Determine what steps need to be taken to make those goals become reality, determine which Profit & Loss line item those goals impact and adjust your forecast accordingly.  For example, your goal is to increase revenue by 10% before the end of the year or launch a marketing campaign whose benefits will be felt in the first quarter of 2006.

3. Forecast Variable Costs

Variable costs are those costs that change in step with revenues.  For example, you are selling more widgets therefore your labor costs and materials costs will increase in relation to the revenue increase. 

Using the concept of Forecast = Projections + Predictions, combined with the knowledge that variable costs change in step with revenues, forecast each month’s variable costs.  Forecast each line item separately, looking for opportunities to reduce costs, and being aware of likely future influences on these costs.

Note:  A projection is an extension of the past into the future and predictions reflect your best understanding and your educated guesses about future changes, uncertainties and unpredictable events.

4. Forecast Fixed Expenses

Fixed costs are those costs that recur month to month and tend to relatively stable.  For example, rent, telephone, internet connection, etc.

Using the same concept we used to forecast variable costs, use the Forecast = Projections + Predictions, combined with the knowledge that fixed expenses tend to be relatively stable and do not change in step with revenues, to forecast the month’s fixed expenses.  Again, forecast each line item separately, looking for opportunities to reduce costs, and keeping in mind the likely future influences on these costs.

5. Forecast Net Profit

The final step is to evaluate what your forecast is projecting for a net profit for the month.  Decide if the profit forecast is reasonable and acceptable.  If not re-evaluate the forecast for each line item, including revenues, and make appropriate adjustments.  Also, if possible anticipate non-operating income and expense items, and include them in your forecast.

Your forecast may not be perfect at first, but we didn’t’ learn to walk without falling down.  We may get a few bumps along the way but I can guarantee you that setting your financial projections down on paper and revisiting them frequently keeps them in your consciousness and helps you to achieve them. 

Hi – it’s Laurie this week.  I love this time of year.  All the country fairs start happening.  You would never know a city girl would like the country so much or maybe it’s the fried dough or fried Oreo cookies that do the trick. I made my first apple pie of the season.

Linda and I have had some exciting things going on with BRN.  We have been very busy lining up something special for this fall.  Be sure to watch your eyes for our Pricing and Packaging Boot Camp! More news to come. Also be sure to check out our BRN Recommends section.  We have some exciting speakers lined up for the fall.

A few years back, during a long legal battle that stemmed from all of my employees breaking an employee non-compete agreement and going to work for my largest client, I really started to examine my business model.  I was really dissatisfied with the whole process of going onsite to a client’s location and doing the bookkeeping work there.  I really wanted to get to the point where most of the bookkeeping work was done out of the client’s office and in ours instead.  I was tired of my clients liking who I hired and trying to steal them out from underneath me, not to mention their constant nickel and dimming of my time and services.  I needed to completely revamp my whole business model.

After doing some extensive research on how to make this “virtual bookkeeping” work, I ended up finding a company called RightNetworks. What caught my attention was something called an Application Service Provider (ASP).  “An application service provider (ASP) is a business that provides computer-based services to customers over a network.”  In english that means, you can host a QuickBooks file (or other accounting software) over the net.  My clients login via my website.  From here it takes them to a remote server environment with another login.  Then it looks like a computer desktop with an icon to their QuickBooks application.   My clients, and myself included, can be virtually anywhere and be able to access their file as long as they have access to an internet connection.  It comes with a universal printer system so you have the ability to link it to whatever printer you happen to be at and print anywhere.  You can even take documents from the remote server and copy them down onto the C: drive on your computer.

Although there are many different companies out there that provides services for an ASP environment.  Currently, that I am aware of, only two are approved vendors through Intuit, one is Insynq http://www.cpa-asp.com/ and the other is RightNetworks http://www.rightnetworks.com.

The key benefits of working with an Application Service Provider are:

1. You can access your documents anywhere.
2. It’s easy, reliable and secure.
3. They offer nightly back-ups.
4. They do all your software updates for you.
5. If your business was destroyed tomorrow your data is stored safely.

The best thing I did was transition my firm to be a more virtual practice.  With tough economic conditions and high gas prices this may be the solution you were looking for.

Copyright © 2008 Linda Hunt and Laurie O’Neil and The Bookkeeper’s Referral Network Inc.

If you would like to use this article on your website or in your own e-newsletter, please reprint in its entirety and include the following information:  Copyright © 2008 Linda Hunt and Laurie O’Neil, The Bookkeeper’s Referral Network, Inc.  Linda Hunt and Laurie O’Neil are the co-founders of The Bookkeeper’s Referral Network Inc., the place where business meets great bookkeepers. To sign up for free articles and insider tips to grow your practice, and add value to your clients while making more money, working less, visit www.bkpr-network.com.

This week it’s me, Linda. 

Ahh September! This month begins my favorite time of year - FALL.  It is such a bountiful time of year with the bountiful harvests from the garden, the colors, and the weather has just that hint of cold in it.  My creative juices really get flowing this time of year.

We have so many great speakers, classes and programs this Fall you won’t want to miss any of it.  Be sure to check out the BRN Recommends section of this ezine and also visit the website to see what is new and exciting.

Happy Fall!

By Linda A. Hunt

Last week I received an email, from a potential client who needed to meet with me the very next day on some important business. He left me his contact information, so I followed up with a phone call. I did not reach this person so I left a message. I immediately received an email back at his displeasure that I could not meet with him the next day. He then proceeded to seek free advice via email.

This inquiry had red flags flying from the moment I read it. Even though I knew that this was not someone I wanted to work with, as a professional courtesy I followed up.

This is where having strong boundaries in place comes in. How did I know I did not want to work with this person? I have created criteria (aka boundaries) that must be met during the first interactions with a potential client. This potential client did not even register on my scale.

Sometimes you cannot miss the red flags and other times they are not so easy to see. Like a couple of summers ago we had a client who knew that we do not handle cash, nor prepare/make deposits on behalf of our clients. This was an onsite assignment and the client assumed that they could literally bully my new staff person into preparing the deposits. Because I educated my staff person on the internal policies of the firm, my new staff person was able to bring this to their supervisor’s attention and the matter was handled.

Setting boundaries can be as simple as setting your office hours or be a bit more complex, such as what you will and will not spend money on and why. Once those boundaries are set, the next step is to clearly communicate them to all involved so that everyone is on the same playing field.

You can tell where you need to create and implement a boundary by what annoys or exasperates you and/or your staff the most. For example, you are in your office trying to finish your marketing letter and you are interrupted for “little” things that your staff has questions about. Creation and implementation of a boundary in this situation is easy, simply close your door and tell you staff you are not to be interrupted for an hour.

Sometimes creating a boundary is not always that easy. Here is an exercise I learned that has helped me tremendously in setting and communicating boundaries. It is called “My Spokesperson” and the exercise goes like this.

1. Sitting in front of you right now, is your “spokesperson.” It is their job to convey the “what” and “how” message of your business and get that information across crystal clear, without hesitation. Let the sense of relief that they will be the perceived “bad guy” wash over you. (This step was huge for me I didn’t want to be known as the bad guy.)

2. Now tell them or write down the information they need in order to communicate the “what” and “how” message that is to be done in this situation. The spokesperson has no ties to the baggage around fear, rejection, or confrontation. They are here to do a job: get your message across.

The first time you write or say what you need to have communicated, don’t be surprised by the emotion that may come out. That is okay, you are working it out so that the message can be conveyed simply and effectively. Simply try it again until the emotion, blame or justification has been removed.

3. Assume the role of your spokesperson and communicate your message.

Remember boundaries do not have to be mean, harsh, or sterile in how you convey your message. You can be firm and kind, clear and concise while being easy to deal with and all the while not violating your boundaries. Here are a few things I have learned about boundaries and why they are so important both professionally and personally.

□ Boundaries are the cornerstone of your business (and person) – it tells people where you stand and WHY.

□ Boundaries make the difference between being taken seriously or not seriously.

□ Boundaries are critical to your business and personal growth. They must be in place and adhered to.

□ Boundaries require applying the idea of tough love to yourself. If you yourself have established boundaries and stick to them, so will everyone else.

□ When learning boundaries, start with yourself and then move on to teaching others.

Hi – it’s Laurie this week.  I hope everyone had a relaxing fun Labor Day Weekend!  It was nice to have a long weekend.  I was actually able to put some serious miles on my bike this past weekend.  If I am lucky I probably can ride up to October that is if the New England weather stays warm.  Many of you, like myself are sending our children back to school. Where did the summer go?

In this week’s article Red Flags Are Flying! Linda shares a fun exercise to help develop excellent communication boundaries.

Wishing you financial serenity,

Linda & Laurie