Do you need timely financial statements for your bonding company?

Does your bank need up to date financial statements for your loan or line of credit?

Are you frustrated with trying to prepare or manage your own books?

Do you want a report that summarizes your job profitability but don’t know how to start?

Are your tax returns filed on time and correctly?

If some of these questions hit home, then you need an accountant upgrade.

Working Capital necessary for Bonding Purposes: The general rule of thumb is that working capital needs to be at least 10% of “backlog” for bonding purposes. A specific taxpayer’s situation may result in a different percentage based on the bonding company’s requirements. Thus, this percentage should be determined on a case-by-case basis. “Backlog” work program is the sum of contracts in process less the billings from those contracts plus contracts not started.

Favazza & Associates, LLC CPAs proudly serves the tax and accounting needs of the Lawn Care and Landscaping industry in the St Louis and Saint Charles Area. We take your case individually to meet the specific industry challenges and Lawn Care and Landscaping tax practices. If you are a Lawn Care and Landscaping company in Missouri, looking for help in the process of job costing, bookkeeping, business planning, or just someone knowledgeable in your industry to bounce ideas off of Favazza & Associates, LLC CPAs will provide you a great accounting solution - fast and effective.
 
Protect your assets from creditors by using our Lawn Care and Landscaping accounting services:

• All Tax Services - business, individual, etc.
• Accounting and Accounting Software (QuickBooks for Contractors and Peachtree)
• Bookkeeping
• Business Structuring, Incorporation and Strategic Tax Planning
• Passive Activity Deductions  
• Tax Deferral Transactions
• Budgeting Projections
• Debt Restructuring and Litigation Support

Contact us at (636) 916-1010 for more information and free initial consultation for Lawn Care and Landscaping Service Business

The Hassle

• Is your bookkeeping behind and affecting cash flow?
• Is your Lawn Care and Landscaping business unfocused and not producing enough income?
  
• Are you doing the books and finding it counterproductive?
  
• Is your spouse or office manager stuck with the task and isn’t up to it or has other duties?
  
• Would you like to spend more time giving bids and prospecting new business and not hassle with the bookkeeping?
  

The Benefits

• You have accurate numbers ALL the time - you can use them to make good decisions for your Lawn Care and Landscaping business.
• You can focus on your business and add value to your jobs and service - do what you do best and let us do what we do best.
  
• You won't continually hire or manage a bookkeeper - freeing you up to concentrate on your customers, vendors and employees. No more management time spent on the bookkeeping position.
  
• You ALWAYS have 100% control - only you can sign checks.
  

The Payoff

You always have up to the minute, accurate data to make to plan and make decisions. Your bank account will show the right balance and your expenses will be properly categorized to give you management information.

On a daily basis, you will be able to spend 5 minutes reviewing reports that show the critical numbers in your business. 

We strongly believe in the 80/20 rule of business. Included will be a monthly phone conference with "your CFO" to review business results and coach you to make sure you are focusing on the activities that truly drive profit, cash flow and growth.


How we do it

• An experienced (15+ year’s minimum) accountant prepares your books.
• Source documents such as invoices, check stubs, etc, are faxed to our office or mailed directly to us.
  
• We access your QuickBooks file remotely using a variety of secure options. You also have complete access to your QuickBooks file 24/7, and maintain complete and total control.
  
• Online banking is used to improve cash management.
  
• Inefficiencies are dropped from the bookkeeping function.
  
• We will revamp your chart of accounts to make your expense categories more detailed and meaningful.
  

No matter how small or large your business is or how terrible your cash-flow is, an accountant that specializes in your industry is one professional you cannot afford to be without.

Accountants provide services that go way beyond frantic, last minute tax returns; or at least they should do. They are highly trained professionals who can be a tremendous benefit to your company.

Accounting and Book-keeping

Many start-up businesses maintain their own accounting records, particularly early on. This can be a good thing, because it may help you understand the financial heart of your business, but eventually the book-keeping must be outsourced, to allow you the busy business owner to focus on other important parts of the business.

Tax Services

A good small business accountant should be active long before the end of the tax year, advising you on how to structure your finances in a tax-efficient way. Ideally, they should be diligent, but not overly aggressive, about minimizing taxes, and must remain well within the limits of the law for your safety and theirs.

Accountants prepare, or assist with, tax planning and tax returns, although it will be more difficult for the accountant to focus on tax-planning or tax-saving opportunities after your financial year end has finished.

General Business Finances

Accountants can help you implement systems and controls to ensure that your business runs more smoothly and profitably. They can also help to find sources of finance and prepare funding applications.

Buying and Selling

Ask your accountant to investigate the financial performance and position of any company you are interested in buying and also help you present your finances accurately and clearly if you are planning to sell.

Personal Finance

Your accountant may be able to provide financial advice and, if not, should be able to recommend a good advisor.

Selecting an Accountant

Look for a firm comparable in size to your company. Small to medium firms generally provide personalized service, specialize in small business work and charge less than big firms.

Fees

You should not choose an accountant based on their fees, but on how much time and money they will save you. However, you do need to know at the outset what the services will cost. Some fees are based on an hourly rate, which may differ depending on who does the work. Fees for tasks like audits are usually offered at a fixed-rate. Find out beforehand what the annual cost will be, and whether you will need to pay a lump sum or whether you can pay in installments.

You can reduce fees by ensuring that time spent with your accountant is focused and well planned, and that your financial systems and records are well organized and up-to-date. They should be able to give you a checklist to help you collate the information they need to save time and money.

Driving the Relationship

In most cases, the relationship with your accountant has to be driven from your side. Arrange regular meetings (at least twice a year) to discuss your finances and taxes. Don’t be afraid to ask questions, after all it is your business.

Conclusion

Choosing a good contractor accountant and developing an ongoing, professional relationship will be a key decision and is worth spending some time on. Finding the right one for your needs should result in you having an invaluable aid for your business as it progresses through the various stages of its life-cycle.

Why we can do it and still save you money
 
80% of the bookkeeping task in a typical Lawn Care and Landscaping business is rote entry. The people that do this typically cost $15+ an hour, plus the overhead cost and management cost.

20% of the bookkeeping task requires a true knowledge of the bookkeeping cycle; these people cost $65 to $100 per hour. They can spot errors, deliver meaningful financial reports, and help you build cash flow.

The problem starts when businesses hire the “80% type” people and cross their fingers and hope for the best. Soon, the numbers can’t be trusted and owners fin themselves using the “Cash on Hand” accounting. This means running a business using anecdote and feelings rather than the facts. What follows? Cash flow problems, extra work hours, and more debt.

We can do this at less cost since we hire, manage, and deliver the appropriate skill for each task. You don’t need to hire a $70,000.00 per year CFO, but you could have access to one only when you need them. No management time or costs is spent on the bookkeeping position. Our use of technology eliminates a huge amount of wasted time in a traditional on site bookkeeping function.  

Transition Process

There are lots of other accountant firms to choose from. To be frank – not all of them are what they claim to be. Very few offer the level of service that we pride ourselves in delivering to our clients.

Our experience and testimonials has shown that many business owners become fed up with the level of service they get – or rather don’t get from their accountants. Even still they fell unable to make the move because they are worried that there will be all sorts of complications with the transition process. Well, don’t worry because we can make that transition easy for you. Some are nervous about telling their accountant that they are moving. We understand and want to help smooth that process for you.

If you want to change your accountant our team will work with you to make sure that the transfer can happen with little interference and disruption. 


Choose the right accountant the first time around

Accountants have to develop detailed knowledge of your business in order to their job.
However, this makes the move to a new accountant much harder. It’s worthwhile to spend a lot of time making sure that an accountant is right for you. Don’t be afraid to ask your prospective accountant for a free preliminary interview. Ask where they went to school, if they participate in continuing education and if they have partners that assist during tax season and if they are reliable after the deadline.

Good accountants will have references and good standing with the Better Business Bureau, Chamber of Commerce and the local banking community. Also, they should have clients in your industry such as contracting. You should make sure that you are personally comfortable with this person because you will entrust your personal financial information to this person.

Does my accountant need to be a CPA?

Absolutely! There are more than a few accountants and bookkeepers that set up shop without any kind of certification or knowledge of the Lawn Care and Landscaping industry. They may be a little cheaper, but if they screw up, you are responsible. So, for instance, if your uncertified accountant gives you the wrong information, the IRS will be talking to you not the accountant. Is that a liability that you want? Certified Public Accountants or CPA’s are held to a higher standard, require continuing education to stay up to date on current tax law, and are a safer bet and a wise investment for your business.

Given the amount of resistance to change that settles in after you've selected an accountant, it's important to make a good choice the first go-around. Makes sense, right?

Surprisingly, most business owners don't thoroughly consider their industry needs when selecting an accountant. That's because many of us who don't have a strong accounting background view all accountants as being equal.

But the reality is that all small business accountants are not created equal.
Small Business Lawn Care and Landscaping Accountants can assist your business and provides useful questions you should use to choose an accountant that truly can help your business grow, not somebody who just crunches the numbers or puts the right numbers in the right boxes on the right tax forms.  

What Do Small Business Accountants Do Anyway?

The increasing role of Lawn Care and Landscaping businesses in the American business landscape and along with the more powerful and accessible information technology has changed the role and importance of the small business accountant.
Why do you need an accountant? Some contracting businesses make due with a bookkeeper this person is sometimes a family member or spouse - someone to perform the tedious task of recording financial information and cranking that data into the necessary formats, like P&L statements and tax forms.

But a good small business accountant does much more than just record transactions and passively generates documents-they actively analyze, interpret and convert that data into actionable business intelligence.

Based on where you want to go with your business, they should be able to tell you how to get there. If your accountant is just showing you the financial tracks of where you have been, you've made a bad choice and you're missing out on a great opportunity to receive good business advice.

To be sure, today's contracting business accountant offers more than crunched numbers. They can be your primary resource for:

• Tax Planning. Beyond simply preparing tax forms, an accountant should be involved in business planning throughout the year. They should be able to regularly advise the business so it functions with peak tax efficiency.
• Business Consulting. A good accountant should be able to help your business grow. Talented small business contractor accountants function as a trusted general business consultant, assessing business problems and offering specific solutions. They offer advice on internal controls, risk management, lease versus buy decisions, inventory strategy, pricing, and even marketing. In short, an accounting professional who really understands your business from the inside out should be a trusted business advisor who is highly motivated to see you succeed.
• Personal Finance Advice. A good small business accountant understands that your personal finances are essentially linked to your business finances. They view the two holistically and offer advice on both fronts. For example, while serving as your small business accountant, they might offer retirement planning advice and estate planning advice that is related to your Lawn Care and Landscaping business activities but that will ultimately leave you in a stronger financial position.
• Technology Know-How. Computing technology has dramatically improved small business capabilities as powerful business software is no longer only for corporations and the Internet provides a level of access to knowledge, customers and suppliers hardly dreamed of even ten years ago. A good accountant must -- must! -- Absolutely be proficient in applying the fantastic and inexpensive information technology that turns business data into strategic intelligence. They need to be very familiar with leading small business management software packages from leading vendors like, Intuit and QuickBooks.
• Networking. While the strength of an accountant is still what they know, a mark of a successful pro is also who they know. Your accountant should be a good source of referrals as they should now precisely each of their clients' strengths and needs. Need to get a loan for your small business? Your accountant ought to be able to introduce you to the right banker.

Questions to Ask Your Prospective Accountant

The bottom line is that you should expect today's accountant to be much more than a bookkeeper. Most do add considerable value. The trick is to separate the wheat from the chaff.

So, with your raised expectations, how do you choose the right accountant for your contracting business? Like any relationship, it boils down to a compatibility of interests, experience and outlooks. Seek recommendations from your peers and ask prospective accountants the following questions:

• Do you have your CPA? Business owners are often confused as to the certified public accountant (CPA) designation. A CPA has a surpassed accepted financial education levels, passed state-administered tests to prove competency and periodic re-certification exams. Certain situations, such as audits and many loan applications, require CPA involvement. What kind of creative business advice will you offer me? A good accountant can skillfully handle data and numbers but should also be able to demonstrate quick and creative business insight. Ask them for some examples in which they offered useful business advice to other clients in a similar industry that went beyond just tracking the numbers. While "creative accounting" is usually a negative, having a creative business mind can be a huge asset towards helping your company to grow.
• Who are your other clients? Imagine this scenario. You hire an accountant based on the assumption that he understands the basics of your business. Then, you find out that he's never had a client like you before. Instead, he's only prepared tax forms for wealthy individuals that don't own businesses. Avoid that possible disaster by asking who the accountant works with. If they are businesses that are similar to yours, that's a good sign. In asking about their clients, you will also want to understand how busy they are and whether they have the time and resources to support you adequately.
• How do you calculate your fees? Ask the accountant what you can expect fees to be and will he guarantee that you will not exceed certain amounts that you agree upon up front. In a time-based fee structure, make sure to find out the hourly rate, as well as all fees for expense reimbursement. Find out now whether a simple two-minute phone call or a one page fax means an hour of billable time. If that's the case, run for the door.
• Are you active in the local business community? Who do you know that can help me? Find out whether your prospective accountant can introduce you to people who might be useful to you, including prospective customers, suppliers, bankers, and investors. Since talk is cheap, take it one step further. Ask the accountant for examples of introductions they've made in the past for other clients and how those introductions played out.
• Why should I use you? As a final question, it's always good to let the accountant make the case for why you should engage them.

Budgeting Mistakes

Budgeting mistakes can be deadly. Avoid these budgeting mistakes at all costs.

Wouldn't it be horrible if you did everything right to set your Lawn Care and Landscaping business on the path to success, but a few budgeting mistakes ultimately lead to your downfall?
Here's a list of budgeting mistakes and budgeting tips to review before you start your Lawn Care and Landscaping business budgeting process.

• No Budgeting. The biggest budgeting mistake for business owners is not to do it at all. It's like driving a car when you can only see two feet ahead of your front bumper. Bills are coming in, checks are coming - and there's a chronic mode of juggling one against the other with no sense of overall profitability or predictability of the future.
• No Business Plan. Budgeting needs to be done to support the business plan. I've seen numerous people work through their budgets and never tie the expenditures to business goals. The first step in budgeting is to develop a three-year business plan for the business. If you don't have a business plan, there's very little value in going through a budgeting exercise.
  
• Question Every Expense. Business owners cannot afford to waste money. If you are paying $500 for website hosting, it's time to look into whether a $100-a-year service might give you the same result. Budgeting is a great time to look at what costs can be eliminated if you bought it last year, it doesn't mean you have to buy it this year.
  
• Ignoring Cash Flow Considerations. Many business owners budget for projected expenses but don't tie that expense budget into their revenue projections. If you only focus on expenses and ignore revenues, you can't project future cash flow. That's a disaster waiting to happen. You can be following your budget to the tee and suddenly find you've got no money in the bank to pay your bills.
  
• Don't Get Too Granular. If you are new to the budgeting process, it's tempting to build line items for every single expense in the company. The problem is the budget can quickly get large and unwieldy. Keep it simple. A budgetary line item for "office supplies" is just fine - no need to budget for pens, pencils, paper and paperclips.
  
• Watch for Spreadsheet Errors. More than a few businesses have signed off on a budget that rolls up all of their expenses only to find out months later that there was a spreadsheet error. Double check all your formulas. When you're done double-checking, it's time to triple check.
  
• Starting Too Late. Many business owners start talking in September about next year's budget but don't actually get around to doing it until December. In that situation, you use the third draft of the budget when you should have gone through ten revisions to get a solid product.
  
• Failure to Systematize Budgeting. If you've gotten to a certain size of business and don't have written instructions on your budgeting presses, stop the assembly lines and take a time out. Get those processes in place so that every year everyone knows what's expected of them and how the budgeting process will play out.
  
• Monitoring the Budget. If you don't compare to accruals and revise it frequently, you are missing the point of budgeting. Budgeting should be more like clay than cement. Flexibility has to be built into the process.
  
• Pareto Principle is Key. Focus on the things that really matter. The budget should illuminate profitability and business strategy issues. Don't spend an equal amount of time on every item. Spend the most time on those line items that drive profitability.
  
• Choosing the Wrong Crew. Some owners make the mistake of having closed-door budgeting sessions that only involve company bigwigs. Not involving the right people is a big mistake. For example, if you don't get input from the people on the front lines, you might never know that an expensive piece of machinery is on the verge of breaking down.
  
• Financial Systems. As Lawn Care and Landscaping businesses grow, they need to evolve beyond spreadsheet-based budgeting. Financial systems are not in place to efficiently do budgeting. A mass of budgeting spreadsheets circulating around via email can be a recipe for a disaster. If you don't have good financial systems in place, it's time to add a new budgeting line item - Buy New Financial Systems.
  
• Use the Budget to Define Incentives. Business owners should view the budgeting exercise as an opportunity to define incentives. One business owner I know creates an EBITDA bonus pool. If the company hits its EBITDA target, everyone shares in the bonuses. That sort of program ensures that you'll follow the budgets and that the budgeting exercises directly contributes to the healthy growth of the business.
  
• Failure to Test Assumptions. Whether your business is large or small, the budgeting process needs a devil's advocate who questions every major assumption. Will gas cost $2.50 a gallon or will it cost $3.50 a gallon next year. For a trucking company, that variability could have a huge effect on profitability and even business viability. So, be sure to question your assumptions and do some sensitivity analysis.
  
  

Budgeting for Small Businesses
 
Wondering how to prepare a budget for your lawn care and landscaping business?

Budgeting is critical in business no matter what size your business is.

Budgeting is an important and necessary part of lawn care and landscaping business ownership.
To begin with, lenders and investors are going to require a budget before they agree to partner with your lawn care and landscaping company. More importantly, a budget can be a valuable tool to help you meet goals and stay abreast of the financial condition of your business.
A budget is really just a financial plan. It can be as simple or as complex as you want it to be, although a certain level of detail is necessary if it is going to be effective. With that in mind, here are some tips to help you get started.

Do a Reality Check
A budget is not something that is pulled out thin air. It has to be based on figures that can be supported by reasonable expectations. Those expectations are based on a combination of prior financial performance and anticipated business growth (or reduction).
To gather the information a contractor will need, you're going to need an accountant that should be able to provide baseline figures from prior financial periods and can provide a reality check about anticipated sales and expenses.

Specify a Timeframe
Budgets are prepared for a specific time period in the life of your business. They are often based on an organization's fiscal year, but you may also want to budget on a monthly, quarterly, or semi-annual basis.
Even if you prepare a budget based on your fiscal year, you should seriously think about breaking it down on a month by month basis. Most financial software programs make this easy by offering a variety of formatting options for the same budget. We recommend QuickBooks for Contractors.

Estimate Income and Expenses
In its simplest form, a contractor’s budget will be an estimated plan of your income and expenses for the specified timeframe. For a cash-basis budget, income will include any payments you receive from sales, accounts receivable, interest, dividends, or virtually any other source.
Expenses, on the other hand, represent funds that leave your business to pay for raw materials, payroll, administration, real estate costs, utilities - the list goes on and on. No matter how carefully you plan, you will undoubtedly encounter some unexpected costs along the way, so try to leave room for them in the budget.
It's also a good idea to consider when income and expenses will be incurred. For example, if you operate a paving business almost all of your income will be received during the summer months. So budgeting your annual income evenly over twelve months would not accurately reflect your situation. A much better approach would be to budget the income for the months you actually expect to receive it.