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thank you all so much for taking time out of your day to join our webinar titled accounting and business outsourcing the wins wise and benefits for your organization our goal today is to describe how outsourcing certain accounting bookkeeping and business processes can allow you to shift your resources to better focus on managing your organization now many of you in our audience today would like to earn cpe credit i want to share how you can claim that credit first you can earn one credit hour of continuing professional education in the accounting field of study for attending today's session certificates will be distributed via email within seven business days following the conclusion of the webinar email certificates will be delivered from certificates at simplecert.net so be sure to check your junk or spam folder if you don't see your certificate when you expect it if you have questions about the certification process those can be sent to marketing at cricpa.com the pdf handout of today's presentation slides will be emailed to all participants within 24 hours following this webinar but you can also download the pdf from the handout section on the right of your screen if you would like to follow along today and to receive credit for today's webinar you will have to answer 80 percent of the polling questions we present throughout today's session incorrect answers will not count against you the polls are pass pass not pass fail as long as you answer you will also have to remain logged in and actively viewing for at least 50 minutes during our one hour presentation we can only award credit based on the electronic records of your attendance i also invite you to type questions into the questions section of the the uh of our panel on our go to meeting panel and we'll watch those we've got somebody watching all of those questions as they come up so please let us know your thoughts and we'll try to answer those as we go through the presentation and we may have to reach out after the presentation too for some follow-ups well folks we have two very accomplished cpas and partners from car rigs and ingram bringing you our webinar today i know both of these folks will and every time i work with them i come away with new wisdom and guidance up first will be dionna divid diana works out of our nashville tennessee practice unit she is a graduate of belmont university enjoys volunteering including working with the second harvest food bank along with exploring other cultures cooking and discovering new restaurants she and her husband are raising three teenage daughters but luckily she has a boxer named tyson to keep them all in line but during her career diana has implemented accounting systems developed best practices and trained many clients and staff members to produce relevant accurate actionable accounting data our next speaker is greg crabtree from our huntsville alabama practice unit greg is a graduate of the university of alabama and has volunteered with the boys and girls clubs of america he tells me that his three grandchildren are lots more fun than his four children i imagine his wife debbie agrees if she's like most grandmoms greg is also an avid golfer and has an australian shepherd named winston's winston i wonder if winston is good at hurting grandkids maybe he needs to be greg is an accomplished public speaker and author of two books that explain in understandable language how to use accounting data to manage your business both books appropriately incorporate the term simple numbers in the type greg is also member chair of the eo at wharton executive education program i'm martin copeland and i will be your moderator for today's program i'm a cpa in cri's aniana alabama office and lead our firm's client accounting services group which is our internal name for business process outsourcing services in addition to my public accounting experience i've worked as a controller and internal auditor in public companies like greg i'm a university of alabama graduate i enjoy canoeing and winter sports which includes one memorable bobsled ride with the u.s olympic medalist but greg i stick to hiking since i agree with the statement that golf is a good walk spoiled let's let's talk about today's agenda i'll run that down for you we're going to discuss why outsource why you should outsource your accounting department accounting outsourcing and what services would could be included benefits of outsourced accounting when you should outsource your accounting leveraging technology guidelines for a successful transition to outsourcing and next steps after establishing accounting processes so uh first up uh is uh deanna dibben and so diana can you start us off by describing some reasons why folks should consider outsourcing accounting department tasks thank you martin for the introduction so why outsource your accounting department let's be honest accounting is typically not the most exciting topic in the business world as an entrepreneur or a business owner most of you would rather talk about products or services your company has to offer and not debits and credits an accounting department handles the day-to-day transaction coding accounts payable accounts receivable payroll management financial reporting and many other services outsourced accounting is a service which provides a full accounting department experience for small to medium-sized businesses as part of running or managing an organization one of the initial and primary concerns is to try to keep costs as low as possible and sometimes this means doing everything yourself including bookkeeping although this could work for a short-term period your focus should be on developing and growing your company and to do this you need a trusted advisor that can provide real-time financial insights and strategic guidance getting timely and relevant information they can produce better faster decisions they can produce better and faster decisions to make your organizations more profitable and efficient and to be able to do this you need to take advantage of advanced technology platforms to gain real time visibility into the business outsourcing will also provide for a cost efficient way to improve accounting functions it enables organizations to scale resources up and down as needed with no obligation to pay salaries or benefits in addition it reduces the burden of hiring training and maintaining accounting staff finding the help needed when existing staff leaves your organization or has an emergency family or health crisis is challenging and it creates undue burden on management and owners by having accounting function outsourced you are guaranteed continuity in your operations and with that we are ready for our first polling question right great and i'll launch that for us and our question is what are some of the reasons to outsource of your accounting functions and the answers are allows management to focus on business growth eliminate me to hire and maintain staff provide peace of mind for business continuity or for all of the above and let me remind you guys that you need to vote on these polling questions so that you can earn your cpa credit for today's session so i'm going to let you guys vote i'm going to leave the polling question open a bit but deanna had struck me as i was listening to you that business process outsourcing might also help organizations deal with unexpected interruptions like the current coveted pandemic have your clients struggle to maintain their books and records during 2020 um in my experience those clients who had limited access to the office in accounting software definitely struggled and fell behind in keeping financials up to date as their setup was not ready for remote work all right thank you for that and i've seen that uh same thing in my practice with my clients i i want to remind you guys that you do need to vote we've got about 80 of the folks that have answered our polling questions and that means about 80 percent of you guys would get cpe credit uh so we got another 20 or so that we'd uh like to hear from just to be sure that uh that we can give you guys credit so i'm going to leave it open for just a few more seconds i don't see a a lot of uh a few more of you voted there in the last few seconds so you go ahead and lock those in for us so we can close this and move on all right we're at about 85 right now and we've got a few more votes still coming in so give us just another moment before i close this and i know some of you guys maybe don't need cpe and it would be helpful if you go ahead and vote even if you don't need cpe so that we know that that we can move on all right i am going to go ahead and close these these results you um if you want cpe credit and you haven't yet voted be sure that you vote on the next few slides so that you get credit so at about 90 of everybody voted i'm going to go ahead and close and i'll share the results and looks like most everybody agreed that 95 uh that is at 95 percent that all of the above was the most appropriate answer now deanna can you describe the services that would be perfect uh candidates for outsourcing when evaluating accounting needs you may question what type of services are included some of the services are presented on the current slide and not all of them have to be packaged together when outsourcing that's the beauty of outsourcing that businesses can pick and choose which services would fit their needs transaction processing this includes bank and credit card transactions to record deposits and purchases typically these are large volume data that needs to be converted into a meaningful financial statement presentation form accounts payable entering paying bills every business has bills to pay however the volume and process for paying these will vary significantly depending on the industry and type of business payroll processing and recording including those with outside payroll provider this may already be one of the functions that that is being outsourced by your company however the payroll data has to get reported on the financials accounts receivable sales invoicing and receipt of payments similar to payables function some smaller businesses and the nature of business they're in may not require invoicing function as sales are recorded when payments are received software and processing training sometimes when only portion of services are outsourced and duties are split with internal company staff we spend time in training on processes and software as needed month end close probably the most common jargon that everyone hears in the accounting world this process includes a number of steps that need to be performed to properly finalize the books for that month those include journal entries that are typically posted at the end of the month without a good handle on the core accounting functions an organization will not be able to budget and forecast or produce any meaningful financial analysis such as identifying most profitable clients or making sure that jobs are priced correctly to uh to make profit management meetings typically cover not only historical data but also cash flow projections and discussions about investing in equipment or hiring more employees now prior to identifying which services are needed business owners will need to gauge existing resources to identify gaps in current operation or as i like to refer to those pain points these could include not only human involvement but also software offerings as part of our initial initial consultations with clients we ask a lot of questions about operations as well as how they're being handled from the accounting standpoint then we tailor our services to that client based on the information gathered and martin with that we are ready for another poll question great and i'll launch that and our question is outsourced accounting services might include tax return preparation transaction processing both a and b or neither a nor b and diana while we're getting our votes in so folks can get their cpe today you just discussed outsourcing the functions that are really truly basic building blocks of accounting and bookkeeping systems do organizations also normally turn over their responsibility for oversight and evaluation of those same services um i would say no and that most clients that outsource their accounting functions typically find that they don't have to spend time reviewing details of transactions and instead they focus on overall financial activity represented on financials all right very good we're at about 77 percent of everybody on the call having uh answered our polling questions so i'd like for you guys to to go ahead and get those answered so we can find out the results and make sure that make sure that everybody does get credit today i i get to to see a sneak preview and i see that uh interesting there's going to be a little bit of disagreement today on this question that's kind of fun we're at about 85 percent voted so i want to get this up to right about 90 i know that not everybody has to have cpe so i'll close it out here in just a few more votes you guys can get those in for us all right so we're right about there and i appreciate everybody voting and hopefully you've had time now to answer so i'm going to close and share those results and interesting kind of spread there we got to we got most people diana that actually chose both a and b what do you think about that that was that was a trick question i guess putting both a and b in there now accounting services would not include tax return preparation that's a separate engagement right so um yeah i think she did it absolutely trick us on that tax services are a service that uh that we provide accountants traditionally provide but we are really speaking on those outsourced accounting services today so i'm going to go ahead and hide the results and we'll move forward and and look i i i'm a self-professed tech nerd cpa and i really enjoy our next topic so diana can you talk to us about leveraging technology in outsourced services so automation is definitely disrupting some of these service offerings however accountants still play a vital role in analyzing data and making sure it's probably reflected on the financials so with evolution of technology over the years traditional bookkeeping and after the fact manual data entry is no longer a standard we have knowledge and understanding of various technology tools and how to combine them with processes and best practices to improve efficiency in accounting functions one of the main efficiencies in adapting to currently available technologies is the fact that it enables automation for many bookkeeping tasks thus reducing and in some instances eliminating time in pure data entry although it may reduce or eliminate human error in data entries and oversight and problem solving skills of qualified and experienced staff is still required so outsourcing also provides implementing technological conversions and the supporting process needed to increase efficiency in addition accounting data is stored on secure secured servers in the cloud and is protected against physical data loss this is important from the disaster recovery standpoint as well as business continuity remote work especially in the current global economic market is a reality and many organizations were not prepared to easily pivot and continue to operate normally because they did not adapt to technological changes that have advanced drastically over the years martin we're ready for poll question number three martin i think you may be muted well thank you very much and you were right i was so i hope everybody was able to read those questions um the benefits of using technology are real-time information increased efficiencies data security or all of the above and i see everybody's uh well into their voting but deanna as you talked about leveraging technology technological changes i wondered how technology might affect the traditional monthly and closed process you described when you discussed outsourced accounting services can you speak to that sure um month and close can be a labor-intensive task but technology is enabling accounting departments to move towards a what we call a continuous close where most of the transactions have already been recorded and month-end process becomes more of a review process and not a fire drill of posting journal entries or reporting transactions great um okay so now we've got about 87 of the folks who voted um i'm going to give you just a couple of more uh seconds here so that you can get your cpe credit for today um we do have a lot more agreement uh on this answer and so i'm going to go ahead and close looks like we're kind of sitting still on our answers so here it is and let me share the results of that poll for you and so yep looks like uh 95 say all of the above and i think i would agree with that wouldn't you be on yes everybody's paying attention good okay so so i'm going to hide the results and we're going to move on and you've touched on a few benefits of outsourcing but let's bring those benefits into focus shall we diana sir so what some of the benefits of outsourcing include the cost effectiveness so hiring an outsourced accounting service is often cheaper and more cost effective than hiring an in-house staff to handle that finance function by outsourcing you don't have the overhead cost of hiring an employee and also the value of having the entire team's expertise rather than just one or couple internal personnel include reducing the risk of non-compliance and unreliable financials especially for smaller businesses starting out real-time information accounting data is processed as it happens providing for timely reporting which helps in financial and trend analysis budgeting and forecasting by having access to real-time information businesses position themselves for growth or security as as mentioned previously data is stored on a secure cloud server accessible from anywhere with an internet connection fraud prevention unfortunately fraud is most likely to occur in smaller companies as a result of having one person overseeing accounting process and circumstances in smaller entities to manipulate the books or have a fake expense overlooked for months are ideal with outsourced accounting services there will be multiple sets of eyes reviewing transactions and reports therefore creating increased internal controls even though fraud can never be ruled out completely but by having a team with accounting expertise and best practices businesses will be more likely to spot an anomaly proactive approach most business owners are not trained accountants and prefer to concentrate on running the business and focus on the overall growth and vision of the company this is why having an outsourced team to oversee not only transaction processing but also provide valuable and proactive insights on data for better financial decisions capacity challenges challenges most organizations struggle with limited resources and increasing demands business needs also change over time and it can be challenging to meet those shifting needs with existing resources outsourcing outsourcing can help fill your needs that may develop over time as your organization grows and outsourcing some or all of your accounting functions from cfo down to bookkeeper can give you access to a wider range of skill set knowledge and team of experts martin we're ready for the next poll question all right and i'll launch that and here it comes and so our our next polling question says the benefits of outsourced accounting include cost effectiveness after the fact information taking a proactive approach a and c only and while we get our answers in so everybody gets their cpa cpe their cpa cp uh deanna you mentioned fraud reduction as a benefit of outsourcing and from my work as an auditor i agree that's everybody segregating tasks especially tasks associated with cash receipts and disbursements is one of the greatest deterrents to internal fraud but if organizations outsource those functions do they also give up stewardship over their cash um not at all so clients maintain the responsibility over approving payments before funds are released and they're depositing cash receipts themselves or as an alternative some organizations provide an option to receive payments electronically in which case funds are automatically transferred directly into their bank account all right very good and we're at about 82 voting uh so far and we've got some uh some fairly consistent answers coming in here this time which is a which is a good thing i want to give you guys just just a few more minutes a few more seconds actually so that you can lock your vote in so that we're sure we can give you your cpe credit for joining us today and looks like we're just barely moving our voting percentage so i'm going to close that down if you want to if you want to get credit go ahead and make your make your vote final and all right so here we go i'm going to close that and share that with everybody and there it comes anc only is there is our winner and gosh i would agree with that i know that accounting firms have offered that uh after the fact service for a long time but uh it it just the resulting data from gathering after the fact information it is is just not beneficial we're looking for a benefit from outsourcing and that data after the fact that is often stale and not actionable so all right i'm going to hide that and move on and you know deanna they say timing is everything but then they also say there's never a perfect time for anything let's just ignore them deanna give us your take on when an organization should outsource their account well there are many different reasons for outsourcing accounting and those reasons will vary for each business startup businesses where an owner may have done it on their own and as the business grows owner's time becomes more valuable doing other things it could be reaching certain level of revenues for example a 1 million dollar mark or employing employing 8 to 10 people introduction of new investors that may require better and timely reporting and by having access to reliable and timely reporting management is also able to make data-driven decisions if business is consistently behind on transaction processing this could be another sign that it's time to outsource or if current reports do not provide information needed to position organization for growth and increased operational efficiencies on the next slide i'll get over the decision qualifications for augmenting internal roles so another challenge that many businesses face is how to staff their accounting needs and the range of skills needed so in general um a 5 million dollar business needs a cfo couple hours per quarter controller couple days per month an accounting manager one day a week and a bookkeeper one day a week so how do you hire internally since since most of these um or not you know not none of these functions are full-time and what ends up happening you will either over hire and have expensive staff work below their value or you under hire and not get the numbers or financial data you need and uh with that we are ready for another polling question all right let me launch that for us and here it comes and the question is when should you consider outsourcing accounting functions when you're experiencing growth and expansion with new outside investors with limited internal personnel or all of the above let's get your votes in so that we can give you your cpe credits but uh deanna much of your discussion in this section revolved around outsourcing as an answer to several accounting challenges now a couple of folks took exception to our trick question a little earlier but i think i know where they were coming from because organizations also have challenges associated with tax and other client compliance reporting responsibilities so can outsource accounting outsourcing accounting tasks help address those challenges as well absolutely outsourcing produces um more timely and reliable accounting data or financial statements which would greatly improve our ability to complete tax return or in some instances it helps clients with other compliance reporting all right thank you for that and guys we're at about 82 percent of everyone that uh that's voted we got up to almost 90 on our last question so let me give you just a couple of more seconds to to answer those poll questions so that you can claim your cpe credit for today and so with that we're getting pretty close i'm going to go ahead and close and i will share the results and this one was not a trick question most everybody came up with all of the above all right let me hide that we'll move on um now dionna i shared with everyone earlier that you were experienced in developing and implementing new processes how would you describe a successful transition to outsourcing so if you're considering outsourcing your finance and accounting function choosing the right strategic partner is crucial whether you're looking for a comprehensive solution adding to your existing capacity or just need some extra help now and then our team approach provides the flexibility scalability and backup that you can get from your existing resources so my recommendations include scheduling initial constant consultation to develop an implementation plan and timeline followed by a meeting or introduction to the dedicated team and manager that will be servicing the needs and having regular and timely communication throughout that transition process and let's talk uh real quickly about the next steps after implementing those processes then um so the next steps um so after establishing accounting processes and having access to uh timely and reliable data businesses can now produce um key performance uh indicators and position themselves for strategic planning and growth so key performance indicators or kpis include ratios and measures that indicate recent performance of your organization accurate and timely data is necessary to generate these ratios key performance indicators can also be key predictive indicators that organizations can use to help in planning their future direction management consultations are important to help organizations understand the data provided by accounting systems once again timely and accurate data is crucial strategic planning is an organization's process of defining its strategy or direction and making decisions on how to allocate its resources to pursue that strategy priorities are set at this step which help which help identify tools needed to implement the strategy and the improvements that that organization achieves through outsourcing accounting processes can greatly enhance the strategic planning process and finally cash flow planning both long term and short term is extremely important for all organizations assessing future cash flows using real-time relevant and reliable data about expected receipts and disbursements can help organizations survive through difficult times cash flow planning is even more important in times of disruptions such as the current pandemic and at this time i'd like to hand it over to martin to continue with our presentation all right so thanks uh deanna for you explaining outsourced accounting services and giving us some ideas about how and when clients can outsource most effectively well let's hear from greg crabtree to tell us more about outsourcing challenges and give us examples of how clients have benefited from outsourcing thanks martin i appreciate it uh great job deanna for going through the foundational elements of what makes a successful outsourcing engagement you know as i looked at this in my career you know i'm i'm one of those folks is saying how can we help a business run better run more profitably be a better return on investment and and as you look back it many of you may have heard of the book the goal by eli goldratt so it's a classic book that's taught in mba programs at harvard on bottleneck theory what are the things that are preventing you from accomplishing what your ultimate goal is and so you know these are really kind of the primary challenges that we kept finding you know as books are not closed within five to ten days now throughout the year it's not as hard of a close but it is very common that as we work with clients in our consulting practice trying to work with their accounting data it's you know third week of the month fourth week of the month next month you know before oh you know and you're having calls you know two months after the end of a month trying to think back and those are challenges that most people need to be analyzing data as close to the period of when they happen as possible the numbers are constantly changing for the for as much as i really like the aspect that accounting programs like xero and quickbooks uh and most systems now allow for you to change an original entry you have to have an understanding of when is it appropriate to change an original entry versus when do you make an adjustment of a future entry and not keep going back and changing data one of the things that we find is once once your team that are being held accountable to the data find that the data keeps moving you're going to lose credibility and so your data has to be credible it has to you know the term i use in my simple numbers books is your financial data needs to speak truth and that's a critical element that you're trying to get to um a lot of it is just for organization you know randomly added charts of accounts uh that that you post things to things that are infrequently used there's not good elevation of subtotals one of the things that one of my favorite fields of study is behavioral economics and what you really want to do is find how does the data influence the best of our human behavior is what you're really trying to strive for and i will tell you that as a practical matter you've got to start at the summarized level and work your way down you can't start at the detail level and think that you're going to climb out to the service and so a lot of that is data organization to make sure that you know are the the accounts and the groupings put together in a functional category that allows for quick interpretation at the high level but also the ability to drill down when you need to do research uh deanna talked about you know fraud is in the number one issue that creates fraud in businesses that we've seen across our careers no separation of duties it is amazing to me how many of our clients that are large who have well-developed accounting departments engage us to do a particular piece of separation of duty that's not easy to carve out within their organization and plus by engaging us to do it it is one of those things that it it allows it to be done on a scheduled rhythmic basis because when you have an extra duty it gets tagged on to somebody's function it's the i'll get around to that oh yeah that's on my to-do list you know one of the things that that we work from from an outsourced accounting standpoint is we work off of schedules and so a lot of that is working through a consistent rhythm of activity to make things happen timely and consistently another big issue is matching of revenues and expenses there there's there's cro-magnon accounting which is you record things as cash is received and checks are written and then the next level of evolution in accounting is oh i send an invoice to a customer and then i book cash against it as i receive it the next evolution is connecting the cost to that invoice is the next level i i just had a conversation this morning with a 12 million dollar software development company that still struggles with true matching of cost and expenses and yet you know they've been successful but they've been so widely profitable that and they haven't had an outside uh force that's kind of pushing them to do it but they realize now that there is a process and it's probably something that will end up helping them we actually already discussed ways of how do you do that in that process so you don't have to be a million to have that problem you can be 12 to 20 million and still have that problem the other issue in data is looking only looking back i mean you know i'm a huge fan of forecasting and i learned this from the book great game of business by jack stack company springfield remanufacturing is a engine diesel engine remanufacturing business i mean these g ys are incredible they they have taught the concept of open book management to their team and they've got machine operators that can explain balance sheets p l's and cash flows better than any cpa i've ever met and a lot of it is because they don't come at it from an academic standpoint they come at it from a practical functional standpoint now one of the things that they do in their business is they reforecast the future weekly so they do hard weekly forecasts to get to the end of the month every week they do hard monthly forecasts for the next two to three months and then they use trend forecasting you know after that and the clients that we've been able to get into that kind of a mindset but there again the forecasting doesn't help you if you don't have good consistent data to get sight lines of trends and processes that come off of that now here's the other thing that's huge once you have this data and you go to your bank and you need to renew your line of credit you need to get a a loan for a new building or a piece of equipment when the bank sees this consistency of information they're going to say oh man where have you been all my life you know it it makes the process of lending to where i mean if you're bankable it's going to make that banking process so much easier because now you're not going to get pounded from questions from the credit analyst of dragging the information out of you because you don't have it you don't have it organized in an easy way but once you can put these things in our cash flow models and other business analytic tools it makes that kind of process so much easier and and it's more of the signing the paperwork and making it happen and as martin said earlier in the old we talked about the old aspect of after the fact bookkeeping you know 30 40 years ago uh some of you on the call may remember the old write-up systems or uh pegboard systems and and you would essentially write checks throughout the month and post deposits and then send all that data to your accountant and and then you get this financial statement back but it it uh it is what i referred to as bad data that is late because it didn't have insight it was very simplistic in transaction orientation it wasn't an interactive accounting system you were just getting handed data you didn't have something to work with and in the world that we live in today we've got to be able to drill down quickly understand what what's in if you have a question what's in a number you've got to be able to know that but you got to have an ability to be able to forecast that number and say you know what is that going to do and how's it going to go forward so let's talk about some financial goals to achieve one of the things that that i am absolutely uh a hundred percent uh you know on is um that your books are live and which in in my definition of live books is really this idea of uh you're probably going to post cash balances uh cash activity from that what does the bank know that you don't know your your your financial records with quickbooks zero whatever accounting system you have that's going to be your true what is the cash balance uh you know that's in there and uh martin if you would if you scroll the next slide please and and so so with live what that means is you're probably going to do minimal checking cash online activity it should take 15 minutes you know every day to just what does the bank know that i don't know and what do i know that the bank doesn't know and make sure that information is in there and then everything else is pretty much on a weekly rhythm so i call it the weekly uh the weekly accounting method and you know if you're only preparing invoices once a month my question to you is you know why you know why are you doing that uh i mean i we have a philosophy that says you know bill quickly and bill often and a lot of it is people look at that and say oh that's easier i will tell you that in in my research in in privately held businesses for the last 20 years that has been the subject of my two books if you can make margin flow faster in your business those are the businesses that come out on top and so to make margin flow faster it means i need to build faster and i need to get paid faster and if i don't have the underlying accounting data to be able to push that piece that's what's important and so realistically on the weekly basis it's mostly revenues cost of goods sold and labor that you're really doing hard weekly calculations and postings on you may pay invoices once a week i mean large companies generally only pay bills twice a month so there's no reason why once a week is perfectly fine for you what this allows for is this fourth bullet point this two-week cash flow forecast has been golden you know we've got a summarized sheet that we teach our clients how to do or we do it for some of them as well and what we found is a two-week cash flow forecast is probably about as far as you need to look forward because it always is going to encompass one payroll period in most businesses now people have tried there's some people a little expanded out to four weeks or some people will do it multiple months you know i kind of look at cash flow on a bigger picture basis past at least the next two to four weeks if you've got a business that's in distress certainly a four-week model is something that you may have to consider but if you're well capitalized if you're running on a good rhythm two weeks is really all you're going to need in that process and you're not forecasting at a detail level you're forecasting using bigger picture numbers of of general what is collections going to be what are my major bills what are you know some no payments or things that might be going through once you do these things then your books when you get to the end of the month there's a handful of month in closing just final validation techniques that things can be done you know by you know a controller or an accounting manager level person and then you can produce the agreed upon financial reports that matter to your business and those there's some cores that we believe in that matter to everybody but those are going to be slightly different for each business in terms of how your business runs are you a an inventory an accounts receivable centric business do you have accounts payables that you have to manage do you have monthly labor productivity that you've got to manage and those become the keys that you got to isolate and look at for each particular business and then once a quarter you're going to get even more detail you're going to take the business i call it you know the profit cube you're going to take a profitability look at the business and break it down into segments and so you know i might have it by line of business by location by customer by employee by team uh by sku if you're a product business and so if you organize the data correctly and we are living in a wonderful age of information technology i i'm 100 in agreement with martin that that you know the tools that we have available to ourselves right now are incredible but it you have to have planning and structure to utilize them to get the data back out on an as-needed basis and so one of the things that that i'll kind of go through with you is we've got three case studies of clients that we've kind of done similar these agreements for so one of our clients is a full outsourcing engagement it was a a graphic design shop that did marketing branding and those things and and really kind of the issues that when they came to us they had a higher level team member that you know kind of a manager level person in their business who had financial understanding but they weren't a trained accountant and so they were actually doing the books and as this company continued to grow and scale it it just kept them from truly doing one what they love to do which is do marketing services for their cutting up for their clients and and they got bogged down into doing bookkeeping and so um they really didn't have any controls in place a lot of these small businesses you're going to find your one person to hand it over to and you're going to abdicate as the owner of letting that person handle it well deanna rightly identified the fact that that is a disaster waiting to happen no matter how much you trust that person we had a client uh one time that it was the wife of the business who worked in the business with the business owner as well and her best friend was their bookkeeper after a month of us doing some consulting services for them we we realized that the the wife's best friend had been paying her mortgage out of the business for two years and it's stolen forty thousand dollars right underneath their nose and so once again you've got to be able to be careful with these things um you know the other thing is is with an untrained accountant there was no linkage and connection of the information and so there's no consistency so what did we do well we provided them with a trained bookkeeper now because we're a company with multiple people that can do that job we're not immune so here's the one thing you gotta understand with outsourcing we're going to assign you a skill level of a person we're not immune to that person not being with us forever they're not going to be your person forever but there's another person that has that same skill set and it's on us to transition if we ever have to change out those roles and because if that person is your person and that person leaves most the time where we end up getting engaged on an emergency basis on outsourcing is we're the backup bookkeeper of last resort and and so many of our outsourcing engagements came from the fact that their person who had all the knowledge of their financial system walked out the door and they didn't have anybody and they didn't had no clue as to how to hire somebody to replace them and so this is really that pain that we can help you avoid in that process we put them on a weekly accounting rhythm so now they had production reports every week they had uh the financial data that they need of production reporting uh and then we also once we're touching that day and on a weekly basis the natural evolution is for us to work on processes and so you say where is the data coming from how could it be improved now here's the thing about process with accounting or operational software like it is most accounting is now done by a non-accountant at the point of transaction so think of it like this if if you go to mcdonald's and the kid behind the counter presses the picture of a happy meal guess what he's just done accounting it figured out how much to charge for the happy meal how much was cost of goods how much labor was involved and how much change to give you back if you happen to be the one out of 100 people who actually use cash and and so that is a system that has been thought through once and delivered and so then you know that's really where you're you're utilizing systems and processes but that's where our team can kind of come in on a you don't need that every day you just need to have somebody to think through it once and periodically review it and update it with you in that process next example is a retail client and this is an example of one of those things that you know tons of great point-of-sale systems but so many of our point-of-sale user clients are under utilizing the capability of that system and so the client had been handling actually the business owner who was taking the data and allow it to connect to their quickbooks and but there were accounts that were accumulating in both inventory and accounts payable were both wrong so here i want to give you guys an accounting lesson it's pretty simple if you want correct books all the dead bodies in your data are on the balance sheet and it's that it's that sheet that you guys never look at well it's an important sheet because it is the physics of accounting if i get the balance sheet correct at the beginning of the period and the balance sheet correct at the end of the period net income has to be right that's it that that's accounting in a nutshell and so in her case we had to clean up the errors figure out what was causing the handoff errors but then what she ended up doing is engaging us that our our person this is a once a month thing our person just comes in and as soon as that month ends we just check to make sure that did all the handoffs uh occur correctly because any time that you have a hiccup in processing or a correction of the transaction or those things many of the systems are not going to hand off that data correctly and that's that's the that's the purpose of a month in validation of that outcome the last one is high-end client they have a controller in place um the it's a company that does uh uh cabinet installations uh and and but in their case the owner is is very much attuned to six sigma uh lean processing things and so what our job was is to really come in once we understood his goals his objectives and and really help his controller and her accounting team to to to look through the processes and be that outside eye because here's the thing you know in a lot of these structural you know programs to help people improve their processes it becomes that aspect that having an outside eye and an inside eye working together creates the best outcome and so what we were able to do is streamline some of the processes and be somewhat of a buffer between the controller and the business owner in making sure that everybody's being realistic in terms of how they're looking at this sometimes it's it's about managing the people aspect of it and then our outsourcing team lead was did weekly calls with their accounting team for about two months just to make sure that those processes got ingrained and we could respond to unforeseen issues that might pop up that the initial analysis might not have seen in that first look but these are great examples of companies that have been able to have significant financial performance even throughout covid and yet you know also have the data to truly understand the financial position that they're in all right martin the poll question you ready for a polling question all right guys this is our final polling question so you guys can pick up your cpe for the day so um here it is how long does it take on average to close your books and produce monthly financial statements well of course this question is really intended to make you think about the timeliness and usefulness of your current processes and and i'll i'll share the results in just a minute um so you guys going to go ahead and get your votes in uh greg i always love hearing your examples um you've you've got some tremendous experience working directly with with clients and it you know some tremendous situations where you've really helped clients move forward and grow in their business and uh and that's amazing well it's been amazing to see that you know there's actually a lot of the same problems that 15 and 20 million businesses have that the million dollar businesses have as well and so i i you know i've always looked at it is it's not about size it is about the impact that you can make with a better data system and i i'm like you i don't think i've ever seen a client yet that couldn't improve their business with better data and you've got to be smart and say is it the system many people are trying to change accounting systems and the system is fine it's more so you're just not interacting with it in the most efficient way absolutely true see that over and over and over we've got about 84 of the folks that have voted so if you guys want to claim your cpe i'm going to give you just a few more seconds to answer those questions and then i've got a little bit of wrap up that i'm going to do here um you know i really do thank all of you for joining us today and we look forward to working together with you as you focus on managing your organization so i'll close that poll and let me share those results and you know i think you can see you know somebody is in the same boat as you are out there i am encouraged to see greg that we had about 42 percent of the folks that say they close in five days or less and that's outstanding tr mendous tremendous all right so let me do my little bit of wrap up here first off i want to share some information about upcoming webinars that are pertinent to this audience today on october 6 at 10 am cri will present a cyber security social engineering focused webinar titled gong fishing and that'll help you learn how to protect your electronic data that'll be eligible for one hour of cpe on october 22nd at 10 a.m our tpa or third party plan administration services group will present a business 401k plan webinar and uh you all know that hiring and retaining employees is challenging and providing retirement benefits is one way to overcome that challenge now the beatles once pinned these lyrics and you'll have to imagine a british accent let me have tell you how it will be there's one for you and 19 for me because i'm the tax man well and even though there were many temporary tax relief measures introduced in 2020 the taxman is still coming and we have two year-end tax planning webinars scheduled both are on november 10th at 10 a.m our tax team will focus on individual tax planning and at 3 pm they will discuss business tax planning and both of those offer cpe credits now on december 10th i would especially like to invite you to join our second accounting and business outsource webinar that will be titled how to be a results-focused data-driven organization and we're going to address how to achieve the financial goals that greg discussed with us today registration information is coming on that one cri also offers podcasts on a variety of accounting industry focused topics but episodes 16 and 19 specifically may be of interest to this audience as they deal with fraud and accounting outsourcing re solutions now you could listen on spotify apple podcast google podcast iheartradio and our cri website and as always we invite you to connect with us on social media where you can learn about all of our upcoming webinars keep up with the latest industry news and learn more about cri again thank you for coming and be sure to reach out to today's presenters and there they are or team members in any of our cri offices for additional information about all of our services again thank you guys so much for joining us today it's uh it's been a pleasure uh hearing from greg and deanna and watching your guys answers to our polling questions and your other questions if we didn't get to one of your questions during today's session we'll try to reach back out to you personally and and see if we can help you with those answers thank you again