We have two starting points-
$400 per month for monthly accounting, or
$250 per month for bi-monthly accounting.
Both starting points assume two bank accounts (such as one checking and one credit card) and fewer than 250 transactions per month. Do really count each transaction? No, but we have to start somewhere.
QuickBooks Online & Xero We only support QuickBooks Online & Xero. The huge benefit of these softwares is that you can see your data in real-time (ready only access) from your computer or mobile device. However, you will only be allowed read-only access since we need to maintain 100% custody of the financial data if we have a bookkeeping engagement; in other words, you cannot directly help. What does all this get you?
Pearson & Cmerek will provide the following basic accounting services (see Accounting Add-Ons below)-
Monthly bank reconciliation.
Importing payroll journal entries and other recurring entries (such as depreciation or loan interest for accurate tax planning).
Detailed list of outstanding reconciliation items for your review and clarification.
Financial statement presentation delivered by the 25th of the following month for management / internal use only.
One on one analysis of financial statements with you (accounting = bookkeeping + analysis).
What if your square peg doesn’t fit our $400 or $250 round hole above? No biggie… we can customize a fee that makes sense to you. Over 80% of our small business owners pay less than $550 per month for accounting. An account here and a few more transactions there doesn’t dramatically compound your accounting services fee.
QBO/Xero Fees It’s a crummy deal, but our accounting service fees do not include the QBO or Xero subscription fees. In the past, accounting software fees were constant and easily predictable. However, over the pas 24 months, Intuit has increased their fees to make it no longer feasible to include in our monthly fee.
So what next? If you are engaging with us for accounting services, and you need to establish a QBO or Xero subscription, we collect payment information on your behalf, and set up automatic monthly billing. Piece of cake!
Custom! We can bundle all sort of things together. Our "Practice Forward" plans typically include corporate tax preparation, individual tax preparation, shareholder payroll processing, routine consultation and tax planning. We can easily add accounting services and employee payroll to our plans. Just ask!
Fine Print Our accounting services are limited. We do not provide invoicing, accounts receivable monitoring and collection, paying invoices or accounts payable accruals. Bookkeeping will generally be done on a cash-basis (if accrual-basis bookkeeping is required then more discussion is necessary).
Our accounting services cannot be relied on to disclose errors, irregularities, or illegal acts, including fraud or embezzlement, that might exist. However, we will inform the appropriate level of management specifically designated by you, of any material errors that come to our attention and any irregularities or illegal acts that come to our attention, unless they are clearly inconsequential.
In addition, we are not providing what our industry considers compilations, reviews or audits. These are terms of art and they have very specific meaning. Our bookkeeping engagement is not providing assurance services.
Accounting Add-Ons
We just reviewed the basic accounting services above… but accounting can also have several offshoots and complexity. Let’s run through some of the most common ones-
Accounting Method Most small business owners are cash based (versus accrual). The IRS code recently changed allowing more taxpayers to be cash based, and it has even expanded some of the hybrid methods. If you need accrual based accounting for whatever reason (better tax position in the near future, required by your franchisor or investors, etc.) this adds time to the accounting service.
Sales Tax This is not common in most service-oriented businesses, but even dentists, eye doctors and veterinarians (just to name a few) have a retail angle to their practices. And boom, they also have a sales tax obligation which can vary between monthly, quarterly and annually depending on the volume.
Personal Property Tax Many counties want you to pay a tax not only on your real estate but also on your personal property (like equipment and furnishings) that are deployed in your business. Don’t get hung up on the word personal… it basically means non-real estate property.
Inventory Complexity Having an inventory can add complexity to your accounting services. How often are you counting inventory? Do you need to count at all (ie, you have lot numbers or you are exempted by tax code)? How are we valuating the inventory (FIFO, LIFO, weighted average cost)? What is the most appropriate cost (market, original purchase price, etc.)? Ok… we really beat the heck out of that stuff.
Sorry… one more thing… do you have direct labor or depreciation built into your cost of goods sold? Ok, now we’re done with this.
Industry Specific Issues Certain industries have their own nuances. Construction sees a lot of job costing where certain expenses are allocated to be a part of the project cost and are capitalized. Retail sees a lot of cash, theft and inventory adjustments. Construction contractors, such as electrical, HVAC and plumbing, usually want to split their world into sales and service, and track revenue and expenses separately. Attorneys have trust accounts and goofy 1099s that need special handling.
Software Integrations Time billing systems (attorney), patient billing systems (doctors), point of sale systems (retail or restaurant) and a zillion other operations-oriented software applications all claim to interface with QuickBooks. Generally they do. But they can also create a big mess… as an attorney, do you want to pay taxes on uncollected revenue less expenses (what we can accrual based accounting) or pay taxes on cash received less expenses (cash based accounting)?
What we are saying here is that software integrations must be carefully monitored for phantom revenue and other downright stupid things.
Benefits Packages This isn’t a super huge deal, but when you start piling on 401k plans, disability, insurance and other benefits platforms, they create extra time during payroll entries. You pay your staff on Friday. On the same day, we must book the obligations for all the payroll stuff although you might be cash-based as an accounting method… this is just to make the journal entry from the payroll activity tie out. Then we need to make sure these payables are cleared when paid. Again, not a huge deal, but certainly more complexity.
QuickStart
Not ready for someone else to do your bookkeeping, but you need some help get going? We have introduced our QuickStart program to get you on the right track right away. This has been super popular with our new business owners.
Our QuickStart fee is $750 and includes-
Set-up QBO
Chart of Accounts
Linking bank accounts
Company legal info in QuickBooks (Address, EIN, etc.)
Training to show the basics of how to use QBO (typically 90 minutes)
How to create invoice
How to apply a payment
How to code bank feed transactions
How to match transactions
How to reconcile bank and credit card accounts
How to create adjusting journal entries for external payroll data, tax return data, etc.
How to change system configuration
Answer any questions during the session
Three scheduled “training” sessions of general support and answering “how to” questions regarding QBO (super fun!)
QuickStart does not include payroll setup within QuickBooks.