In a conversation with a builder today, I noticed huge similarities between the construction process and running a successful business.
This design/build contractor was stating that the best way to run a construction project was to take time to strategically outline the details and then execute the plan. He was explaining how costly and frustrating it can get when his customer makes big changes half way through the job. “Once the foundation is poured”, he said, “it can be very costly to change the design. Time spent planning will always pay off down the road”.
After a while we began to discuss his business and how he moves through his day. “I am constantly putting out fires and sometimes ask myself if I should be doing something else with my time, something more productive”
It hit me that the construction process is not unlike the business process itself.
Make a plan, then work the plan
When we think strategically about our business processes, we can be more effective, more efficient, and happier because we know the tasks that need to done. With a process in place our people then execute the system. Without the clarity of knowing what really works in our business, it’s not surprising that we wander day to day throwing stuff up on the walls of our business to see what sticks.
What specific activities generate new business? What percentage of business comes from the web/social media versus word of mouth referrals? Are you constantly changing course mid-stream? What is the most profitable part of your business? What’s the most productive use of your time and talents?
As the captain of the ship your people and your customers look to you for leadership and direction. Do you know how effective you are in the leadership role? Do you know what makes a good leader?
To successfully pour a foundation, for example, a specific process is followed. A plan is drawn up, general site work takes place, a survey is conducted and stakes positioned to mark the site. People and machinery are brought in to dig the hole, set the forms, pour the concrete, remove the forms, etc.
Do you have similar procedures in place for your business? How you market, answer the phone, take a customer through the sales process, and hold employees accountable?
Most of us come to business from the technical end. We are great carpenters, accountants, photographers, etc. The challenge is when we begin to grow and change our knowledge needs to change with it. Our job description changes from “carpenter” to leader. The activities and knowledge needed by a leader are completely different from that of a technician in the field.
In order to grow your business and have a sane life outside of work it’s necessary to have a solid strategic plan. A plan for your business, a strategic marketing plan, a road map for your people to follow and the desire to change.
The desire to change is the first and most important step. Often business owners don’t make a change until they are feeling the pain. The pain of 60 plus hour work weeks, strained relationships, dwindling check book balance.
Time to face reality.
What’s working in your business? What’s not? By taking time away from the day to day operations and getting a 30,000 ft. view of your business, you will find clarity and direction. Your people, health, relationships, and business depends on it.
Best practices and tips for installing a QuickBooks 2012 upgrade on a computer that already has an existing version of QuickBooks in place.
Remember, QuickBooks MUST be installed using a Standard User Account when you are running Windows Vista or Windows 7 AND you use QuickBooks integrated 3rd party programs – see Windows, QuickBooks & 3rd Party Apps – The Struggle Within.
If you have Intuit do the upgrade, DO NOT let the Intuit rep install the new version from within your computer’s Administrator account and DO NOT let them choose the “upgrade” option when they do the installation. Also, make sure that your computer IT person is aware of the requirements and best practices – many do not.
Make sure that you watch and understand what is being done to your computer – don’t let others simply do “whatever”
Installing/upgrading QuickBooks is a fairly straightforward task, but that doesn’t mean that there aren’t some things that can trip you up along the way. Below are some “best practice tips”, based on technical support calls from our customers, that will help you to ensure a smooth installation/upgrade:
PLAN AHEAD and make sure that everything is in order – DO NOT install the new version of QuickBooks 2012 on the day that you need to run payroll, do billing, or perform any intensive task that requires access to your computer/company data file.
- Perform some basic file maintenance in your current QuickBooks version – backup your file, rebuild the data, check the current file size and number of database file fragments.
- If you use 3rd party integrated applications, make sure that you contact the software developer (if they haven’t already contacted you) about compatibility with and update procedures for working with QuickBooks 2012 – Gold and Silver Developers {those who have applications listed on the Intuit Marketplace} did not have access to a final release copy of QuickBooks 2012 until 9/12/2012; for other developers – well they might have access to the new version today.
- Start with the computer that houses your QuickBooks data file – paying close attention to the following screens.
- On the “Choose Installation Type” window select the “Custom and Network Option“
- On the “Custom and Network Options” window, select whatever the current settings are on your computer
- On the Upgrade or Change Installation Location window, choose the Change the install location option. This installs QuickBooks 2012 in a new folder and when the installation is complete you will have BOTH your current {old} QuickBooks version and the new QuickBooks 2012 version installed on the computer.
- When the installation is complete, you’ll be prompted to reboot your computer. After the reboot, start QuickBooks 2012 and open your company file.
- Rebuild your data file, check your file size and number of database file fragments.
- Install the new version of QuickBooks on each of your other computers; repeating Steps 4, 5, 6, and 7.
Once the new version of QuickBooks is installed and running properly on all of your computers, remove the old version by going to your Control Panel -> choosing Add/Remove Programs {Windows XP} OR Programs & Features {Windows Vista & 7}, find the old version in the list of programs and choose Uninstall or Remove.
We hope that you’ve found these best practices and tips for installing a QuickBooks upgrade to be helpful. If so please take a moment to leave a comment or share it on your favorite social network.
This payroll tip discusses being prepared for Wage & Hour and IRS Audits – what records have to be kept, how long you need to keep them, etc. From the General Ledger, a complete newsletter for Professional Bookkeepers published by the American Institute of Professional Bookkeepers.
Break out the trusty old metal/wooden file cabinets and wipe off the dust — or maybe it’s time to invest in some virtual file cabinets where documents are scanned in and stored off-site but accessible if you need them. Either way you are in for a shock!
We’ve mentioned previously that the U.S. Department of Labor is making a major push on wage-hour enforcements and that the IRS has also beefed up enforcement efforts – but what we didn’t include at that time was a list of documents that you must keep and how long they have to be kept. When October’s issue of the General Ledger arrived, this information was front page news; and I felt I needed to share it with you. I hope you are sitting down and have had your morning coffee!
Even if your company has never violated one IRS or DOL rule, substantial penalties may apply simply for not maintaining required records. Now is the time to gather or seek copies of the records you are required to keep under federal law. Records may be stored at at company offices; or for multiple locations, in a central office.
Keep for at least 4 years:
The IRS requires employers to keep the following for at least 4 years. NOTE: Because the 4-year period begins at different time, keep the following for at least 5 years.)
|
|
The DOL or IRS (or both) require you to keep the following data. If not in hard copy, it should be available to print.
Keep for at least 3 years:
|
|
Keep for at least 2 years:
Documents that support calculations for the following.
|
|
Keep for at least 4 year
From April 15 following the due date of the return; employment related tax forms and data.
|
|
Vendor and non-employee payments:
|
|
All of this adds up to a LOT of paperwork that you have to keep on hand and accessible. Storage is going to be an issue for most businesses as well as making sure that the stored documents are kept safe – I know that these issues are a concern for me, as like most business owners I only have limited space.
We’ve used QuickBooks since we started our business in 2000, so all of the “detail” is housed in our QuickBooks file; we did have to archive our file at the end of 2006 because it was getting too big and running slow, so we have a backup copy that contains all the detail stored in our safe deposit box at the bank. Our current QuickBooks file contains a summary of that archived information, and I keep that backed up and stored in a several locations – locally on an external hard drive, on a remote (cloud based) location that both my husband and I have access to, and a backup which I keep on my laptop – so my QuickBooks file is pretty safe.
But, the hard copy paper payroll related data – well, right now all of that is stored by year in 3-ring binders; and all of the paper copies of business income and receipts are stored in cardboard file boxes in our attic! If there was a fire – well, we’d loose all that paper data! I guess it’s time that I get my act together and do something about electronic storage for at least all of the payroll related data.
How are you storing all of the information that would be required for a wage-hour or IRS audit?
A QuickBooks for contractors tip about receiving and applying joint checks from a general contractor to pay a lower tier subcontractor or material supplier for work completed or materials on a construction project.
Quite frequently, in the construction industry, a contractor will receive a joint check from a General Contractor to pay their lower tier subcontractors or material suppliers for work completed and/or materials delivered to the construction project’s job site.
Unlike many high-end construction accounting packages, QuickBooks doesn’t have a way to handle this automatically — or easily.
This QuickBooks for contractors tip provides what we consider to be a best practice when a situation like this arises.
Problem:
Your company, Sam Subcontracting, received a $10,000.00 joint check from Joe’s General Contracting; which is made out to both your company AND O’Fallen Gravel {your Vendor/Material Supplier} who delivered sand, gravel, and crushed rock to a jobsite. The $10,000.00 was included in your most recent invoice totaling $45,000.00 that you sent to Joe’s General Contracting AND you have a $10,000.00 invoice from O’Fallen Gravel in Accounts Payable. Amy, your bookkeeper, isn’t sure how to correctly receive this payment against your own Accounts Receivable AND correctly apply this payment to your Accounts Payable.
Solution:
When Amy is ready to receive the payment against the invoice issued to Joe’s General Contracting AND record the payment to O’Fallen Gravel, she should do the following:
- Verify that she has a special “Clearing” Account in her QuickBooks Chart of Accounts that is a “Bank” type – if one does not exist she should create it by going to the Lists menu -> Chart of Accounts -> Account -> New -> Type = Bank -> Continue -> Account Name = Clearing -> Save & Close.
Right click on the image to enlarge it
- Click the Receive Payment icon on the QuickBooks Home Page – OR – from the Customers menu -> choose Receive Payments. Received From = Joe’s General Contracting -> Amount = $10,000.00 -> Date = Current Date -> Pmt. Method = Check -> Check # = Check Number -> Memo = Joint Check issued to O’Fallen Gravel -> Deposit to = CLEARING ACCOUNT. Click Save & Close.
Right click on the image to enlarge it
- The balance in the Clearing Account should now be $10,000.00.
- Click the Pay Bills icon on the QuickBooks Home Page – OR – from the Vendors menu -> choose Pay Bills. Choose the O’Fallen Gravel bill -> Method = Check -> Select Assign check number -> Account = CLEARING ACCOUNT.
Right click on the image to enlarge it
- Click Pay Selected Bills.
- In the Assign Check Numbers window – enter the number of the check that you received from Joe’s General Contracting.
Right click on the image to enlarge it
- Click OK
- The balance in the Clearing Account should be 0.
Make sure that you also have the proper Lien Waive and Release forms.
We hope you found this QuickBooks tip to be useful — if so please take a moment to leave a comment, share it on your favorite social media site or click the +1 button below.
We are teaming up with the Associated General Contractors {AGC} of America San Diego Chapter, Inc. for a day of QuickBooks for Contractors on Tuesday November 8, 2011; 8:00 AM – 4:00 PM .
QuickBooks is the leading small-business accounting software on the market today. But when it comes to knowing how to use QuickBooks in the commercial/government construction industry and dealing with complexities such as AIA Billing and certified payroll reporting, finding help becomes difficult. Join us {Nancy Smyth – Sunburst Software Solutions, Inc.} as we team up with the Associated General Contractors {AGC} of America San Diego Chapter; for an intensive day-long training session for using QuickBooks in the commercial/government construction industry. Below are some of the highlights of the course.
Morning Session – Job Costing, Estimating, Purchases & AIA Billing using QuickBooks
- The importance of job costing
- Working with/setting up you QuickBooks Item List {aka your cost codes}
- Creating and using Estimates & Progress Invoices
- Tracking Committed costs and subcontracts with Purchase Orders
- Proper Vendor/Subcontractor invoice entry
- Getting Equipment costs into your job costing reports
- AIA Billing and automation
Afternoon Session – QuickBooks Payroll & Certified Payroll
- What is Certified Payroll? Who makes the rules and how to comply
- Working with Wage Determinations
- Determining employee labor burden – OR – the hourly cost of having employees on the jobsite
- How to include employee labor burden in payroll
- Setting up and using QuickBooks Payroll to deal with Prevailing Wages – regardless of how you pay your fringes
- How to fill out a certified payroll report – what information is needed
- Electronic certified payroll filing requirements
- Automating the certified payroll reporting process
Who should attend?
- Business owners
- Estimators
- Controllers
- CFO’s
- Payroll processors
- Office Managers
- Accounting & Consulting professionals
- Union and non-Union Contractors
This course will be held at:
AGC San Diego Chapter Inc., 6212 Ferris Square, San Diego, CA 92121
Phone: (858) 558-7444 Extension 101
When: Tuesday November 8, 2011
Time: 8:00 AM – 4:00 PM (8 hours)
Cost: $199 AGC Members OR $259 Non-Members
Register Online: https://www.agcsd.org/Calendar/Registration/registration.php?classType=educat&classID=1244
I look forward to seeing and meeting you all! Nancy Smyth, Sunburst Software Solutions, Inc.
