Employee Time Theft – You Can’t Afford To Ignore It

Do you have an employee who is always late? One who makes or receives personal phone calls daily or one who sneaks out a couple of minutes early on a regular basis? What about an associate that is on their cell phone texting through out the day or who clicks off the computer screen as soon as you walk into their office? If you do you have an employee that is stealing time pure and simple.

Have you ever stopped to consider what these types of employee time theft are costing you? An employee who robs you of 5 minutes per day 5 days per week is stealing the equivalent of approximately 2.8 days per year assuming an 8 hour work day.

If you pay an employee $15 an hour and that employee is stealing 2.8 days per year, it’s costing you $396 per year considering a factor for payroll taxes and employee fringe benefits.

If your employee steals an hour a day 5 days per week the cost of the theft has just skyrocketed to 33 days per year and $4,680 again considering a factor for payroll taxes and employee fringe benefits.

How can you control expensive employee time theft? Clearly state policies in the personnel guide and have employees sign it to be sure they have read the guide and understand the policies. The guide should include policies on personal phone calls, cell phone use, internet use and working hours as well as policy relating to tardiness.

Let your employees know how much you are willing to tolerate—you can disallow personal phone calls except in the case of an emergency. Talk to “tardiness” offenders—tell them their pay will be docked or worse—remind them that everyone in the office is a professional, and professionals don’t punch a time clock. Make it clear that cell phone use of any sort or “surfing the net” will not be tolerated UNLESS it is business related.

The key is to be aware of the situation, bring it to the employee’s attention, specify the ramifications should they fail to modify their activities, and consistently enforce the penalty you have set. If it’s clearly a matter of policy, you take the emotion out of your reaction and simply make a good business decision.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

IRS Proposes New Rules for Tax Preparers

The IRS has recently announced a new set of proposed rules for tax preparers. If enacted, the new rules would become effective January 1, 2011.  According to the proposed rules, all paid tax preparers would be required to:

1. Register with the IRS and obtain a preparer tax identification number. Once a preparer is registered, the IRS will be able to verify that the preparer has filed his or her personal tax returns and business and employment tax returns, along with paying the taxes on those returns. If the paid tax preparer has not filed those returns timely or paid the taxes due, penalties can be imposed by the IRS, including a prohibition on filing tax returns for clients.

2. Submit to a competency test. This rule does not apply to attorneys and certified public accountants that are active and in good standing with their licensing agencies.

3. Obtain continuing professional education. Again this rule does not apply to the attorneys and certified public accountants of Demorest Law Firm, PLLC, or Numerico, P.C. since we have our own requirements from the Michigan Bar Association and the Michigan Association of Certified Public Accountants.

In my opinion, the proposed new rules are long overdue. Currently, only certified public accountants, attorneys and enrolled agents have standards that are implemented by their individual associations. For far too long, tax preparers have been able to put a sign up that says Joe’s Tax Service, yet they were not required to have any formal training, testing or registration requirements. The IRS is beginning to understand the complexities and dangers involved in regulating an industry with certain unregulated components.

Hopefully these proposed regulations will add a serious deterrent to the fraudulent or incompetent preparers that we hear about far too often in stories from individual taxpayers such as “I don’t know why I got such a large refund, my preparer just had me sign the return and I didn’t get all of the reported refund.” “ I didn’t know that I hadn’t been filing returns, I thought my preparer had already filed them.” “What do you mean that I have not paid my employment taxes for my business or filed my employment tax forms? I gave my paid tax preparer access to my Company’s bank account and electronic withdrawals for the employment taxes were taken from my bank account.”

To read the IRS proposed regulations please click here.

How to Succeed Where Others Have Failed

Stop anyone you meet and ask “what’s the biggest mistake a new business owner can make?”  Odds are they won’t know. A more insightful respondent (perhaps one who knows from personal experience) might mention “undercapitalization” or “lack of cash flow”.  They’re usually right. But the truth is, the biggest mistake is usually not one but a combination of the following maladies: “being overly optimistic when projecting revenue”, “having a weak (or nonexistent) business plan”, “pricing problems”, “a failure to seek professional advice”, “rushing to market”, “insufficient experience”… the list goes on.

On the other hand, ask them what makes an entrepreneur succeed, and you should hear statements like “owner’s self-confidence”, ”emphasis on service (quality) rather than price”, “working hard”, ”luck”, “devoting full time to the business”, “industry expertise”, and “making a significant capital investment”…

The point is, to succeed, you need not only the desire, but a well-rounded understanding of the pros, the cons, and how to exploit or avoid them.

A prudent business owner does his homework by considering the possibilities mentioned earlier and determining, in advance of their occurrence, how to avoid the “pitfalls” and ensure success. One of the keys to success is turning to experts for professional advice.

If you make a practice of turning to objective professionals early on in the planning process, you’ll increase your likelihood of finding the avenues which will lead to your success.  For example, a good banker can be very helpful in identifying credit needs, an insurance agent in identifying risks that need covering, an attorney concluding on the appropriate business form (sole proprietor, partnership, LLC and “C or S” corporations) and CPA can advise as to cash flow needs, accounts receivable control, tax planning direction and much, much more. Consider bringing your local banker, insurance agent, attorney and CPA on board sooner than later. By doing so what you will find is you can focus on what you do best – managing your business – knowing you’ve got a team working with you to handle matters outside your realm of expertise.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

Save Yourself

Even smart people make mistakes. Many people who have picture perfect careers are taking photographs with the lens cap on when it comes to their personal finances.

Or, if they have the lens cap off, they are too busy taking pictures to pay enough attention to the subject matter – their personal financial affairs. Either way, the result is – they make mistakes – big mistakes that can cost them a great deal of money.

AMONG THE WORST MONEY MISTAKES IS:

*NOT SETTING GOALS. Rather than saving what is left after paying the bills (which for many may be close to nothing) make a commitment to yourself to save a specific amount of money – and then do it.

The first thing to do is set easily attainable short-term goals that are going to have a positive outcome. For example, decide how much money you want to save in one year and cut it up into bite size pieces.  Allocate a fixed amount of your net income as savings and pay yourself first. Use the remaining cash to figure your personal budget. Be realistic so you don’t fall into the trap of saying “since I can’t save xxx dollars, I might as well not save any…” and “… I don’t know where all my money goes, but I don’t have any left for savings…”

Be successful in reaching your savings goal by creating a workable savings plan. Take your annual savings goal and divide by twelve. Then promise yourself that every month you will save that amount. Allow yourself some flexibility while guaranteeing your success. If you get paid bi-weekly, plan to save an equal amount out of every check, while allowing for minor setbacks – promise yourself you will make up any deficiency from one paycheck by the end of the month – to reach your monthly savings goal.

The key is to set realistic, attainable goals, make them manageable, and keep a promise to yourself. Once you get started on a positive savings trend you won’t want to quit, and before you know it, you will have reached your goal… just in time to set another one.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

He Who Hesitates is Last!

As a business owner, the quality of your decision-making determines your success or failure. By decisions, we don’t mean what suit you’re going to wear or whether to go to the gym or not. Those are choices. In a decision, the issue you’re facing is unconventional. This means there’s going to be some uncertainty, particularly when the stakes are high.

In today’s business environment, decision-making is becoming more complex. There are many more variables to consider, which makes dealing with a new situation even more difficult. But there are ways of honing our decision-making skills to simplify the process.

Knowing your objectives is one of the most important, but often overlooked, ways to sharpen your skills. The more you are aware of your core values and objectives, the easier your decision-making will be.

Attachment to one outcome will limit your effectiveness as a decision-maker. The problem-solving process should unearth many viable alternatives. Your job is to decide which solution is best in light of the facts. If you’ve pre-selected an outcome, without considering other options, you run the risk of making the wrong decision. This can be costly in the business world.

Involving those people affected by the decision helps clarify objectives and eliminates some alternatives right away, simplifying your choices. Further, if the wrong person is making the decision, you can be assured that the potential for failure is much higher. Decisions are always best when made by the people closest to where the decision will be implemented.

Gathering too much information is a common problem in decision-making. Generally, only 20% of all decisions need to be put off to gather more information. How do your know when your have enough information? Ask yourself this simple question, “how much impact will additional information have on my decision?” Once you’ve answered that, consider the costs of gathering the additional information and add the costs (if any) associated with delay.

So what’s the solution to poor decision making? Practice. Start with small decisions, strengthening your skills, and move up to the bigger decisions. As your skill level increases, so will your success rate. And always remember, it’s your choice.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

Personal Success – For Life and Business (Part 6-7)

Meaningful Goals and Objectives

If you are not making the progress you expect personally, then most likely, your goals have not been clearly defined and properly visualized. Clearly defined goals are the keys to fulfillment and achievement. They are essential for success. The English author, Edward G. Bulwer-Lytton, wrote: “The man who succeeds above his fellows is the one who early in life clearly discerns his object and towards that object habitually directs his powers. Even genius itself is but fine observation strengthened by fixity of purpose. Every man who observes vigilantly and resolves steadfastly grows unconsciously into genius.”

The benefits of setting goals are neither mystical or hazy. There are real and significant values to be gained from practicing goal-setting:

1. Goal-setting improves your self image improving you today for a better tomorrow.
2. Goal-setting makes you aware of your strengths which can help you to overcome obstacles.
3. Goal-setting makes you aware of your weaknesses. Through awareness, you can set new goals to improve in those areas.
4. Goal-setting gives you a sense of past victories which provides stimulus for present and future success.
5. Written goals help you visualize, actionize and then actualize.
6. Goal-setting gives you a track on which to run.
7. Goal-setting forces you to set priorities and direction. It forces you to crystallize your thinking.
8. Goal-setting separates reality from wishful thinking.
9. Goal-setting forces you to define and establish in concrete form your system of values and to take responsibility.
10. Goals provide criteria to sharpen decision-making. If the criteria have (has) not been defined, decisions get made in terms of immediate pressures.

Generally, experts have agreed that failure in life results from a lack of clearly defined purpose. Success in life does not result from chance, rather, a succession of successful days. The starting point for anybody is personal program of goals.

Self-Actualization

Shakespeare said, “To thine own self be true and it must follow as the night the day thou canst be false to any man.” There is that still, small voice in each of us that makes it clear we are on the track to self-actualization or derailed.

As a child we come to the world all lit up and then we unplug ourselves from the Source, from God, ultimately resulting in the light going out.

To see and experience our own light, our inner strength, direction, and wisdom, we need to plug ourselves back into our Source. We need to learn to be still and get away from the noise, static and extraneous thoughts of our external world. All we have to do is go inside and have a willingness to listen as He is waiting to help and assist us. But we must listen with our hearts.

Ultimately He is the conductor who keeps us on track as we travel the journey of personal success, who says “you had a productive day, week, month and year.” He does not deceive or misguide when we learn to listen.

By beginning with the end in mind, and listening to your heart, self-actualization, i.e., being all that you can be, becomes a lifestyle. The journey then becomes endless and delightful.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

We at DetroitBusinessLaw.com hope that this series has been helpful to you personally.  We cannot be truly successful in business unless we are personally successful.

Personal Success – For Life and Business (Part 5)

Financial Independence

There are universal laws of compensation. Perhaps the most recognizable of all is “As ye sow, so also shall ye reap”. In the spiritual sense, it is important to remember that we all have everything that we need right now and always.

Giving without the expectation of getting enhances the harvest. Going the extra mile or providing service beyond that which is being paid for puts you on the correct path. These are universal truths that lead us to financial independence.

Making a commitment to do what it takes and being willing to pay the price leads to financial independence. Living by the age-old adage, “waste not, want not” enhances it.

Some of you will be shocked by the following statement, but did you know it is perfectly legal to be out of debt? THAT’S RIGHT! Apparently, however, many of us have been sold on the “borrow your way to wealth” concept. The concept is ludicrous, just look at the housing market as an example.

Although there is a way leverage can contribute to your financial independence, it must be used judiciously.

Finishing the series up tomorrow, we will touch on Meaningful Goals and Objectives and Self Actualization.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

Personal Success – For Life and Business (Part 3 & 4)

Physical Health

Physical health creates energy, adds quality and years to your life. Although most look at financial independence as the end-all, recognize that whether your W-2 shows $50,000 or $150,000, it doesn’t make you any happier.

On the other hand, your quality of life will certainly suffer from inattention to bodily needs. No one would argue with the fact that system abuse will shorten your life.

Recognizing that certain “pressures” exist for all of us to succeed, remember that “success” without physical health will leave you a physical (and emotional) wreck. Reasons as to how we got this way are unimportant. A commitment to physical well-being and the positive results it brings must be the focus.  Complete personal success demands physical well-being.

Complete and Long-Term Loving Relationships

“No man is an island,” that adage reads, which I think expresses the importance of relationships. Ask yourself the question, “Who or what is the most important thing in the world to me?” Think about it if necessary, reflect: is it the money, the car, the house in Palm Springs? If your answer is yes, think again.

Most of us have been brought up in an environment that has strongly suggested that success in life depends on how hard we work to get all the things on which our culture tends to put a high value. Yet, our human desires never seem to be sated. Our “personality” self always wants more.

HOLD IT! Forget the acquisition of what I call “stuff”. Know your motivations and most importantly, begin with the end in mind. When you “get there” and there is no one with whom to “share the wealth” your success will be short-lived.

Recognize it’s the people, not the stuff that is of consequence.

Up next, Financial Independence.  Watch for it tonight around 6pm!

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

Personal Success – For Life and Business (Part 2)

Peace of Mind

We come into the world with only two fears; fear of falling and fear of loud noises. Fears we add to our psyche are learned habits. Most additions are based on perceptions which stem from our belief system and are created by life experiences. In other words, our belief system is based on past experiences which are constantly being relived in the present with anticipation of the future being like the past. We actually project these beliefs onto others.

Once we understand that what we perceive through our physical senses presents us with a limited and distorted view of reality, that is, we recognize our perception is a mirror, not a fact, we begin to take responsibility for every thought and experience. Clearly, our thoughts regarding other people create either a union with or separation from that individual. To successfully eliminate fear, anger and guilt (self-directed anger) in our interactions we must consciously ask “do our thoughts bring about union or separation?” Separation is created in peace of mind lost by blaming or making another person wrong and yourself right. The lesson here: there is no one to blame.

If peace of mind is our only goal, then at every encounter we must ask:

1. Do I want to be happy or do I want to be right?
2. Can I be happy blaming and making another person wrong and myself right?
3. Do I want to experience peace or do I want to experience conflict?

There is a smooth way that things tend to operate in nature. Observing a world that is not reacting to one’s interference, harmonizing through understanding guarantees peace of mind.

Up next at 2pm, Physical Health and Loving relationships.

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.

Personal Success – For Life and Business (Part 1)

While moving recently I came upon two different tape programs I had listened to years ago entitled: “The Psychology of Achievement” by Brian Tracy and “Creating Positive Relationships” by Diane Cirincione and Gerald Jampolsku, M.D. Both deal with personal success and are worth revisiting here. I have taken the liberty to paraphrase some of the comments from each.

Although there are a number of definitions of success, the one I like best is what you accomplish relative to your potential. Or, as the U.S. Army jingle goes, “be all that you can be…”

More to the point, personal success means:

• Peace of mind, i.e., freedom from fear, anger and guilt.
• Physical health
• Complete and long-term loving relationships
• Financial independence
• Meaningful goals and objectives
• Self actualization, i.e., knowing you are being all that you can be.

Let’s explore each, one at a time over the next few days.  First up tomorrow morning, Peace of Mind…

This article was written by Gary Field, CPA at Numerico, PC. Click here to view Numerico’s website.