Although you might excel at managing your employees and overseeing the creation of new products, as a business leader, it can be much harder to cope with your start-up’s budget and ensure that your company and its expenses stay within it. This is especially the case if you do not have a background in finance. If improving your budget management is on your list of goals for 2024, read on.
Hire an Accountant
If you believe that you cannot possibly manage your budget alone and you are afraid of the situation remaining the same, you should consider outsourcing the financial aspects of your business. By hiring an accountant, you will be able to better understand your expenses and whether you are staying within the limits of the budget that you established within your business plan, and outsourcing your finances can save your staff time and your company money. This accountant will also be able to fulfill services such as preparing for the end of the tax year. However, when looking for an accountant, you need to ensure they are trustworthy and well-reviewed. You might even ask other entrepreneurs to recommend one with which you can build a good relationship.
Use an Accounting App
Are you struggling to stay within your business’s budget and yet are reluctant to outsource? If this is the case, you should consider downloading an accounting app. These apps have been specially designed to give businesses power over their own finances, no matter how much knowledge they have of financial processes. By downloading an accounting app, you might be able to make financial projections that can inform your future budget and track the amount of money going in and out of your business in a few clicks. This will ensure that you are never clueless about how much money you have to spend each month.
Hire a Finance Team
Rather than trying to complete every task alone, you should make sure that you can rely on a team of skilled employees who have the best interests of your business at heart. By establishing a finance team within your business, you will be able to ensure that your business’s cash flow runs smoothly without you having to oversee it. This delegation will leave you free to work on the elements of managing your company that you excel in and that you went into business for in the first place.
Review Your Budget
If you are nervous about what 2024 will mean for your business’s finances, the first step that you should take, though, is to review your budget, which you might have originally thought about many years ago. By reviewing your budget, you will garner a better idea of where you stand and will ensure that your current budget still works for your company and its situation. This will mean that, if you stick to your budget, there is unlikely to be any issues with money for your company in the coming year.
https://www.strategydriven.com/wp-content/uploads/pexels-pixabay-259209.jpg8541280StrategyDrivenhttps://www.strategydriven.com/wp-content/uploads/SDELogo5-300x70-300x70.pngStrategyDriven2023-12-20 08:00:582023-12-19 20:07:49How Can You Manage Your Business’s Budget Better in 2024?
Prioritizing staff wellness has become more critical than ever. A healthy and happy workforce not only contributes to increased productivity but also leads to improved job satisfaction and reduced employee turnover. In this blog, we’ll explore the significance of staff wellness in the UK workplace, discuss its benefits, and provide practical tips on how employers can promote wellness among their teams.
The Importance of Staff Wellness
The well-being of employees is a vital component of any successful organization. Here’s why staff wellness is so important:
Elevated Employee Morale: Fostering an environment where employees feel supported and esteemed contributes to higher morale, thus nurturing a workplace culture imbued with positivity.
Augmented Productivity:A workforce in good health tends to exhibit heightened productivity, enhanced focus, and increased engagement in their tasks, ultimately resulting in elevated performance levels.
Enriched Job Satisfaction: Prioritizing staff wellness within the workplace fosters a sense of job satisfaction among employees, which, in turn, bolsters retention rates and cultivates enduring loyalty.
Diminished Absenteeism:Thoughtful wellness initiatives have the potential to curtail sick days and absenteeism, offering dual benefits of cost savings for employers and the uninterrupted flow of business operations.
Talent Attraction and Retention: Companies that emphasize employee wellness stand out as more appealing destinations for top-tier talent, streamlining the process of recruiting and retaining skilled and committed professionals.
Enhanced Mental Health: A concerted focus on staff wellness can serve as a buffer against stress and a catalyst for improved mental health outcomes among employees, thereby mitigating the risk of burnout.
Practical Steps to Promote Staff Wellness
Here are some practical steps employers can take to promote wellness:
Create a Positive Work Environment:
Foster a culture of respect, inclusion, and open communication.
Encourage teamwork and collaboration to reduce feelings of isolation.
Recognize and celebrate employees’ achievements and milestones.
Offer Flexible Working Arrangements:
Allow employees to have a say in their work schedules when possible.
Promote remote work options to improve work-life balance.
Provide Adequate Work-Life Balance:
Encourage employees to take breaks and use their vacation time.
Set clear expectations for work hours and overtime.
Promote Physical Health:
Offer gym memberships or fitness classes as part of your employee benefits.
Provide standing desks or ergonomic office furniture to reduce the risk of physical strain.
Educate employees about the importance of self-care.
Promote activities such as mindfulness, meditation, or yoga.
Promote Financial Wellness:
Offer financial planning resources and tools.
Provide education on budgeting, savings, and retirement planning.
Regular Check-Ins:
Conduct regular one-on-one check-ins with employees to assess their well-being.
Encourage managers to have open conversations about workload and stress levels.
Employee Assistance Programs (EAPs):
Offer EAPs that provide support (confidentially if needed) for employees facing personal or work-related challenges.
Collect Employee Feedback:
Create avenues for employees to provide feedback on wellness initiatives.
Use feedback to continuously improve wellness programs.
Success Stories
Several UK companies have successfully implemented staff wellness programs with positive results:
Unilever: Unilever offers a range of wellness initiatives, including mental health support, physical activity programs, and flexible working arrangements. The company’s commitment to wellness has led to improved employee satisfaction and engagement.
Aviva: Aviva provides a comprehensive wellness program that includes mental health support, financial wellness resources, and health and fitness initiatives. As a result, the company has seen a decrease in absenteeism and an increase in employee retention.
British Gas: British Gas offers a flexible working policy that allows employees to choose their working hours. This flexibility has led to improved work-life balance and higher job satisfaction among employees.
Conclusion
Prioritizing staff wellness is not only the right thing to do for employees’ well-being but also a strategic investment in the success of your organization. By implementing practical wellness initiatives and fostering a positive workplace culture, UK employers can create a work environment that promotes staff wellness and supports the holistic well-being of their teams.
https://www.strategydriven.com/wp-content/uploads/pexels-pixabay-289323.jpg8541280StrategyDrivenhttps://www.strategydriven.com/wp-content/uploads/SDELogo5-300x70-300x70.pngStrategyDriven2023-12-19 21:00:282023-12-19 20:00:39Prioritizing Staff Wellness: A Guide to a Healthier and Happier Workplace
As we advance into the 21st century, the concept of work has undergone a transformative shift, predominantly influenced by the rapid growth of digital technologies. The future of work is not a distant reality; it is unfolding now, characterized by digital work environments that are reshaping how we think about and how we approach our professional lives.
The Emergence of Digital Workspaces
The digital work environment is a product of technological advancements, enabling employees to work from anywhere in the world. This flexibility and connectivity signify a move away from traditional office-centric models toward a more dynamic, tech-driven approach.
Key Elements of Digital Work Environments
Remote Working and Flexibility:Digital work environments inherently offer flexibility. The ability to work remotely means that physical location is no longer a constraint, allowing companies to tap into global talent pools and employees to enjoy a better work-life balance. The use of virtual offices in London allow businesses to have the best of remote working and a set office.
Technology as a Backbone: The reliance on digital tools and platforms – from cloud computing to collaborative software – is at the core of digital workspaces. These technologies enable seamless communication, data sharing, and project management, regardless of geographical barriers.
AI and Automation: Artificial Intelligence (AI) and automation are increasingly playing significant roles in digital workplaces. They optimize operations, drive efficiency, and open new avenues for innovation and productivity.
Strategies for Embracing Digital Work Environments
Invest in the Right Tools:For organizations, investing in the right digital tools is crucial. This includes not just collaborative software but also ensuring that cybersecurity and data privacy measures are robust.
Foster a Digital Culture: Embracing a digital work environment goes beyond technology; it involves cultivating a culture that supports continuous learning, flexibility, and digital literacy among employees.
Prioritize Employee Well-being:Digital work environments should also focus on employee well-being. This includes ensuring that employees don’t suffer from digital overload and providing support for mental health and ergonomic setups.
Challenges and Solutions
Despite its advantages, the digital work environment is not without challenges:
Cybersecurity Risks: With the increase in digital data usage comes the heightened risk of cyber threats. Organizations must prioritize cybersecurity strategies to protect their sensitive information.
Managing Remote Teams: Effective management of remote teams requires clear communication, trust, and the use of performance metrics that focus on output rather than hours logged.
Ensuring Inclusivity:Digital environments must be inclusive, offering equal opportunities and access to resources for all employees, regardless of their location or circumstances.
Conclusion
The future of work is undeniably digital. Embracing digital work environments is no longer an option but a necessity. This transition requires a thoughtful approach, balancing technological adoption with the human aspects of work. As we continue to navigate this digital era, the success of work environments will largely depend on how well we adapt to change and integrate these changes into our daily professional lives.
https://www.strategydriven.com/wp-content/uploads/pexels-vlada-karpovich-4050291.jpg8541280StrategyDrivenhttps://www.strategydriven.com/wp-content/uploads/SDELogo5-300x70-300x70.pngStrategyDriven2023-12-19 20:00:592023-12-19 19:48:38The Future of Work: Embracing Digital Work Environments
Companies of all sizes, from small startups to large corporations, are recognising the benefits of outsourcing. Outsourcing is not just about cost savings; it’s a strategic move that can lead to enhanced efficiency, access to specialised skills, and a sharper focus on core business activities. In this article, we explore various departments that can be effectively outsourced, highlighting how this approach can streamline operations and foster business growth.
Customer Service
One of the most commonly outsourced departments is customer service. In an era where customer experience can make or break a business, ensuring a high level of service is paramount. Outsourcing customer service can provide access to a team of experienced professionals who are adept at handling inquiries and resolving issues. This not only enhances the customer experience but also allows in-house staff to concentrate on other critical areas of the business.
Moreover, outsourcing firms often operate across different time zones, offering the advantage of round-the-clock customer support. This can be particularly beneficial for businesses looking to expand their global footprint. Furthermore, these firms stay abreast of the latest trends and technologies in customer service, ensuring your business can offer contemporary solutions to your clients.
IT Support
Every business these days will need some sort of IT support/infrastructure in place. This is where outsourcing IT support can be incredibly beneficial. IT support from Infinity Group, for example, specialises in providing comprehensive IT support tailored to a business’s specific needs. From managing servers and networks to ensuring cybersecurity and facilitating software updates, these services are crucial for uninterrupted business operations.
Outsourcing IT support can also be a cost-effective solution. It eliminates the need for an in-house IT team, which can be expensive to maintain, especially for small to mid-sized businesses. Moreover, providers like Infinity Group bring a wealth of expertise and stay up-to-date with the latest technological advancements, ensuring your business can leverage cutting-edge technology. Their proactive approach to IT support not only resolves issues quickly but also helps in preventing potential problems, thereby ensuring smoother business operations.
Marketing
Outsourcing the marketing department can be a game-changer for businesses seeking to elevate their brand presence. Marketing agencies bring a wealth of experience and creativity, coupled with an outside perspective that can inject fresh ideas into your strategy. From social media management and content creation to search engine optimisation and digital advertising, these agencies cover a broad spectrum of marketing activities.
Outsourcing marketing efforts means you have access to a team of specialists who are up-to-date with the latest marketing trends and tools. This approach can be particularly beneficial for small to medium-sized businesses that may not have the resources to sustain an in-house marketing team with such diverse expertise.
Finance and Accounting
The finance and accounting department is crucial for any business, but managing it in-house can be challenging, especially for smaller businesses. Outsourcing these functions to specialist firms can ensure accurate bookkeeping, tax preparation, payroll processing, and financial reporting. This not only helps in maintaining compliance with financial regulations but also provides insightful financial analysis that can guide strategic business decisions.
Outsourced accounting firms use the latest software and technologies to streamline financial processes. This can lead to more efficient operations and can also offer better insights into your business’s financial health, enabling more informed decision-making.
https://www.strategydriven.com/wp-content/uploads/pexels-lukas-317353.jpg8541280StrategyDrivenhttps://www.strategydriven.com/wp-content/uploads/SDELogo5-300x70-300x70.pngStrategyDriven2023-12-18 21:00:032023-12-18 20:36:08Effective Outsourcing: Key Business Functions You Can Delegate
Construction companies need reliable financial reporting to track expenses, recognize revenue, and manage cash flow. A general bookkeeper or inexperienced CPA must address this.
The right accounting firm will understand the unique challenges of construction accounting. They will use their industry knowledge to help you optimize your finances and prepare for growth.
Experience
The best construction accounting firms have vast experience managing these clients’ unique financial management needs. Developing deep domain expertise in the construction industry allows them to offer valuable value-added services like estimating and budgeting, project cost tracking, progress billing, and software implementation. Additionally, a firm that works closely with many construction firms understands specialized rules and regulations regarding job-costing methods, revenue recognition, and tax laws.
Professionals working with construction businesses have also mastered accrual accounting, which differs from cash accounting in that it records income when the company earns it rather than when it receives payment for the work. This helps construction companies keep track of their finances and make informed decisions about how to bid on projects, manage profit margins, and bill customers accurately.
An excellent CPA for construction firms can also help their clients prepare and file taxes, reducing their risk of audits, penalties, and fines. They can also advise on the latest changes to reporting standards and tax laws that may impact their clients’ business operations.
Expertise
It is essential to find a firm that understands the unique accounting requirements of construction firms. Construction bookkeeping is much more complex than traditional general accounting. It requires a specific approach incorporating software programs that allow workers in the field, business owners, and accountants to submit data on costing through a platform.
Additionally, construction accounting is project-centric. A construction firm needs a way to manage, categorize, and report transactions for each job to prepare taxes and ensure that service pricing is accurate. This is known as job costing.
Expertise is often considered a given talent, like Tiger Woods or Michael Jordan in sports, Albert Einstein in science, Wolfgang Amadeus Mozart in music, Bill Gates or Warren Buffett in business. However, research shows that expertise is not a given but a skill built through practice and experience. According to Hatano and Inagaki, experts develop their knowledge by seeking new problems, requiring them to apply different procedures and strategies. In addition, they seek out feedback on their work.
Fees
Accurate accounting is essential for bidding on projects, determining profitable ones, and billing clients accurately in the construction business. It can also help ensure compliance with regulatory requirements and industry best practices. A reputable CPA firm with intimate market knowledge can advise contractors on spending decisions, such as buying or leasing equipment.
Many companies offer a wide range of services beyond basic accounting. These might include budgeting and forecasting, cash flow management, risk management consulting, software implementation for job costing and project tracking, and dispute resolution with subcontractors or suppliers.
Specialized accounting for the construction industry can address unique challenges arising from time-consuming tasks like work-in-progress reports, calculating overhead, and using technical tax elections. A seasoned accounting professional can also advise on strategies to minimize tax liability and maximize deductions, including deducting mileage for travel to and from job sites. This is important because a company’s ability to take advantage of tax deductions can significantly impact its bottom line.
Reputation
Reputation is more than “what you know” or “what others think.” It includes all the aspects of a business that are not readily visible. This consists of the ability to work effectively with clients, partners, and other stakeholders in the industry. The construction accounting firm you choose should be able to build and maintain an appropriate reputation in your local market.
Having a CPA who is well-versed in the unique complexities of construction accounting and is actively engaged with a wide range of clients is essential for addressing issues that arise. They can help ensure your company is compliant, avoids costly practices, and maximizes its financial processes and growth potential.
For example, the right firm will have expertise in state and local taxes (SALT) and how they affect your costs. They will also be aware of new accounting pronouncements and their impact on the way you recognize revenue and lease obligations. They can help you develop cost allocation strategies consistent with your business model and optimize tax reporting. They can also help you implement a software program to make job costing much more accessible and ensure the information is available to your employees and accounting partners.
Personality
The right personality is essential to the success of a CPA firm. While most firms can answer the basic questions, such as “How often do you meet?” and “What are your fees?”, the best ones can distinguish themselves by displaying an extroverted nature, superior communication skills, comfort with public speaking, and other traits. Moreover, it’s important to note that every business is different and requires unique daily operations. For example, contractors must stagger their recognition of income to avoid pushing themselves into a higher tax bracket in a good year. An accounting firm can help in achieving this by providing strategic advice.
https://www.strategydriven.com/wp-content/uploads/pexels-rfstudio-3825540.jpg8541280StrategyDrivenhttps://www.strategydriven.com/wp-content/uploads/SDELogo5-300x70-300x70.pngStrategyDriven2023-12-14 15:00:562023-12-14 14:22:28Tips for Working With Professional Construction Accounting Firms
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Business Programs
How Can You Manage Your Business’s Budget Better in 2024?
/in Managing Your Finances/by StrategyDrivenAlthough you might excel at managing your employees and overseeing the creation of new products, as a business leader, it can be much harder to cope with your start-up’s budget and ensure that your company and its expenses stay within it. This is especially the case if you do not have a background in finance. If improving your budget management is on your list of goals for 2024, read on.
Hire an Accountant
If you believe that you cannot possibly manage your budget alone and you are afraid of the situation remaining the same, you should consider outsourcing the financial aspects of your business. By hiring an accountant, you will be able to better understand your expenses and whether you are staying within the limits of the budget that you established within your business plan, and outsourcing your finances can save your staff time and your company money. This accountant will also be able to fulfill services such as preparing for the end of the tax year. However, when looking for an accountant, you need to ensure they are trustworthy and well-reviewed. You might even ask other entrepreneurs to recommend one with which you can build a good relationship.
Use an Accounting App
Are you struggling to stay within your business’s budget and yet are reluctant to outsource? If this is the case, you should consider downloading an accounting app. These apps have been specially designed to give businesses power over their own finances, no matter how much knowledge they have of financial processes. By downloading an accounting app, you might be able to make financial projections that can inform your future budget and track the amount of money going in and out of your business in a few clicks. This will ensure that you are never clueless about how much money you have to spend each month.
Hire a Finance Team
Rather than trying to complete every task alone, you should make sure that you can rely on a team of skilled employees who have the best interests of your business at heart. By establishing a finance team within your business, you will be able to ensure that your business’s cash flow runs smoothly without you having to oversee it. This delegation will leave you free to work on the elements of managing your company that you excel in and that you went into business for in the first place.
Review Your Budget
If you are nervous about what 2024 will mean for your business’s finances, the first step that you should take, though, is to review your budget, which you might have originally thought about many years ago. By reviewing your budget, you will garner a better idea of where you stand and will ensure that your current budget still works for your company and its situation. This will mean that, if you stick to your budget, there is unlikely to be any issues with money for your company in the coming year.
Prioritizing Staff Wellness: A Guide to a Healthier and Happier Workplace
/in Managing Your People/by StrategyDrivenPrioritizing staff wellness has become more critical than ever. A healthy and happy workforce not only contributes to increased productivity but also leads to improved job satisfaction and reduced employee turnover. In this blog, we’ll explore the significance of staff wellness in the UK workplace, discuss its benefits, and provide practical tips on how employers can promote wellness among their teams.
The Importance of Staff Wellness
The well-being of employees is a vital component of any successful organization. Here’s why staff wellness is so important:
Practical Steps to Promote Staff Wellness
Here are some practical steps employers can take to promote wellness:
Create a Positive Work Environment:
Offer Flexible Working Arrangements:
Provide Adequate Work-Life Balance:
Promote Physical Health:
Mental Health Support:
Encourage Healthy Eating:
Promote Financial Wellness:
Offer Professional Development:
Foster Social Connections:
Flexibility for Family Needs:
Encourage Self-Care:
Promote Financial Wellness:
Regular Check-Ins:
Employee Assistance Programs (EAPs):
Collect Employee Feedback:
Success Stories
Several UK companies have successfully implemented staff wellness programs with positive results:
Conclusion
Prioritizing staff wellness is not only the right thing to do for employees’ well-being but also a strategic investment in the success of your organization. By implementing practical wellness initiatives and fostering a positive workplace culture, UK employers can create a work environment that promotes staff wellness and supports the holistic well-being of their teams.
The Future of Work: Embracing Digital Work Environments
/in Managing Your Business/by StrategyDrivenAs we advance into the 21st century, the concept of work has undergone a transformative shift, predominantly influenced by the rapid growth of digital technologies. The future of work is not a distant reality; it is unfolding now, characterized by digital work environments that are reshaping how we think about and how we approach our professional lives.
The Emergence of Digital Workspaces
The digital work environment is a product of technological advancements, enabling employees to work from anywhere in the world. This flexibility and connectivity signify a move away from traditional office-centric models toward a more dynamic, tech-driven approach.
Key Elements of Digital Work Environments
Strategies for Embracing Digital Work Environments
Challenges and Solutions
Despite its advantages, the digital work environment is not without challenges:
Conclusion
The future of work is undeniably digital. Embracing digital work environments is no longer an option but a necessity. This transition requires a thoughtful approach, balancing technological adoption with the human aspects of work. As we continue to navigate this digital era, the success of work environments will largely depend on how well we adapt to change and integrate these changes into our daily professional lives.
Effective Outsourcing: Key Business Functions You Can Delegate
/in Managing Your Business/by StrategyDrivenCompanies of all sizes, from small startups to large corporations, are recognising the benefits of outsourcing. Outsourcing is not just about cost savings; it’s a strategic move that can lead to enhanced efficiency, access to specialised skills, and a sharper focus on core business activities. In this article, we explore various departments that can be effectively outsourced, highlighting how this approach can streamline operations and foster business growth.
Customer Service
One of the most commonly outsourced departments is customer service. In an era where customer experience can make or break a business, ensuring a high level of service is paramount. Outsourcing customer service can provide access to a team of experienced professionals who are adept at handling inquiries and resolving issues. This not only enhances the customer experience but also allows in-house staff to concentrate on other critical areas of the business.
Moreover, outsourcing firms often operate across different time zones, offering the advantage of round-the-clock customer support. This can be particularly beneficial for businesses looking to expand their global footprint. Furthermore, these firms stay abreast of the latest trends and technologies in customer service, ensuring your business can offer contemporary solutions to your clients.
IT Support
Every business these days will need some sort of IT support/infrastructure in place. This is where outsourcing IT support can be incredibly beneficial. IT support from Infinity Group, for example, specialises in providing comprehensive IT support tailored to a business’s specific needs. From managing servers and networks to ensuring cybersecurity and facilitating software updates, these services are crucial for uninterrupted business operations.
Outsourcing IT support can also be a cost-effective solution. It eliminates the need for an in-house IT team, which can be expensive to maintain, especially for small to mid-sized businesses. Moreover, providers like Infinity Group bring a wealth of expertise and stay up-to-date with the latest technological advancements, ensuring your business can leverage cutting-edge technology. Their proactive approach to IT support not only resolves issues quickly but also helps in preventing potential problems, thereby ensuring smoother business operations.
Marketing
Outsourcing the marketing department can be a game-changer for businesses seeking to elevate their brand presence. Marketing agencies bring a wealth of experience and creativity, coupled with an outside perspective that can inject fresh ideas into your strategy. From social media management and content creation to search engine optimisation and digital advertising, these agencies cover a broad spectrum of marketing activities.
Outsourcing marketing efforts means you have access to a team of specialists who are up-to-date with the latest marketing trends and tools. This approach can be particularly beneficial for small to medium-sized businesses that may not have the resources to sustain an in-house marketing team with such diverse expertise.
Finance and Accounting
The finance and accounting department is crucial for any business, but managing it in-house can be challenging, especially for smaller businesses. Outsourcing these functions to specialist firms can ensure accurate bookkeeping, tax preparation, payroll processing, and financial reporting. This not only helps in maintaining compliance with financial regulations but also provides insightful financial analysis that can guide strategic business decisions.
Outsourced accounting firms use the latest software and technologies to streamline financial processes. This can lead to more efficient operations and can also offer better insights into your business’s financial health, enabling more informed decision-making.
Tips for Working With Professional Construction Accounting Firms
/in Managing Your Finances/by StrategyDrivenConstruction companies need reliable financial reporting to track expenses, recognize revenue, and manage cash flow. A general bookkeeper or inexperienced CPA must address this.
The right accounting firm will understand the unique challenges of construction accounting. They will use their industry knowledge to help you optimize your finances and prepare for growth.
Experience
The best construction accounting firms have vast experience managing these clients’ unique financial management needs. Developing deep domain expertise in the construction industry allows them to offer valuable value-added services like estimating and budgeting, project cost tracking, progress billing, and software implementation. Additionally, a firm that works closely with many construction firms understands specialized rules and regulations regarding job-costing methods, revenue recognition, and tax laws.
Professionals working with construction businesses have also mastered accrual accounting, which differs from cash accounting in that it records income when the company earns it rather than when it receives payment for the work. This helps construction companies keep track of their finances and make informed decisions about how to bid on projects, manage profit margins, and bill customers accurately.
An excellent CPA for construction firms can also help their clients prepare and file taxes, reducing their risk of audits, penalties, and fines. They can also advise on the latest changes to reporting standards and tax laws that may impact their clients’ business operations.
Expertise
It is essential to find a firm that understands the unique accounting requirements of construction firms. Construction bookkeeping is much more complex than traditional general accounting. It requires a specific approach incorporating software programs that allow workers in the field, business owners, and accountants to submit data on costing through a platform.
Additionally, construction accounting is project-centric. A construction firm needs a way to manage, categorize, and report transactions for each job to prepare taxes and ensure that service pricing is accurate. This is known as job costing.
Expertise is often considered a given talent, like Tiger Woods or Michael Jordan in sports, Albert Einstein in science, Wolfgang Amadeus Mozart in music, Bill Gates or Warren Buffett in business. However, research shows that expertise is not a given but a skill built through practice and experience. According to Hatano and Inagaki, experts develop their knowledge by seeking new problems, requiring them to apply different procedures and strategies. In addition, they seek out feedback on their work.
Fees
Accurate accounting is essential for bidding on projects, determining profitable ones, and billing clients accurately in the construction business. It can also help ensure compliance with regulatory requirements and industry best practices. A reputable CPA firm with intimate market knowledge can advise contractors on spending decisions, such as buying or leasing equipment.
Many companies offer a wide range of services beyond basic accounting. These might include budgeting and forecasting, cash flow management, risk management consulting, software implementation for job costing and project tracking, and dispute resolution with subcontractors or suppliers.
Specialized accounting for the construction industry can address unique challenges arising from time-consuming tasks like work-in-progress reports, calculating overhead, and using technical tax elections. A seasoned accounting professional can also advise on strategies to minimize tax liability and maximize deductions, including deducting mileage for travel to and from job sites. This is important because a company’s ability to take advantage of tax deductions can significantly impact its bottom line.
Reputation
Reputation is more than “what you know” or “what others think.” It includes all the aspects of a business that are not readily visible. This consists of the ability to work effectively with clients, partners, and other stakeholders in the industry. The construction accounting firm you choose should be able to build and maintain an appropriate reputation in your local market.
Having a CPA who is well-versed in the unique complexities of construction accounting and is actively engaged with a wide range of clients is essential for addressing issues that arise. They can help ensure your company is compliant, avoids costly practices, and maximizes its financial processes and growth potential.
For example, the right firm will have expertise in state and local taxes (SALT) and how they affect your costs. They will also be aware of new accounting pronouncements and their impact on the way you recognize revenue and lease obligations. They can help you develop cost allocation strategies consistent with your business model and optimize tax reporting. They can also help you implement a software program to make job costing much more accessible and ensure the information is available to your employees and accounting partners.
Personality
The right personality is essential to the success of a CPA firm. While most firms can answer the basic questions, such as “How often do you meet?” and “What are your fees?”, the best ones can distinguish themselves by displaying an extroverted nature, superior communication skills, comfort with public speaking, and other traits. Moreover, it’s important to note that every business is different and requires unique daily operations. For example, contractors must stagger their recognition of income to avoid pushing themselves into a higher tax bracket in a good year. An accounting firm can help in achieving this by providing strategic advice.