Latest / The Perfect RIA / Dollars and Sense: Why Bookkeeping Matters More Than You Think with Guest Duff Tucker [Episode 274]

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Dollars and Sense: Why Bookkeeping Matters More Than You Think with Guest Duff Tucker [Episode 274] · The Perfect RIA

• 0:47
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• 1:26
  Matthew Jarvis: Hello everyone, and welcome to another episode
• 1:29
  of The Perfect RIA podcast. I'm your host. Matthew Jarvis, with
• 1:32
  me today, special guest from our friends over at BELAY. Of
• 1:35
  course, you know, believe we worked with them for years. They
• 1:38
  provide invaluable virtual assistant services, but they
• 1:41
  have expand that, as many people are unaware, including myself,
• 1:45
  they also have bookkeeping services. And so we have with us
• 1:48
  today, Duff Tucker, who is the Account Services Manager for
• 1:51
  BELAY, who helps companies get bookkeeping services in place.
• 1:54
  And so what we're gonna chat about today with Duff is when,
• 1:57
  as small business owners. Does it make sense to bring in a
• 2:00
  bookkeeper? What are some common bookkeeping mistakes, and where
• 2:04
  do we sort of kid ourselves that I think I'm doing the
• 2:06
  bookkeeping, but I'm probably not so Duff. Thanks so much for
• 2:10
  being here. Really excited to have you on the call today.
• 2:13
  Duff Tucker: Yeah, thanks, Matt. It's great to be here today, so
• 2:15
  I'm excited as well.
• 2:16
  Matthew Jarvis: Well. So do you got a lot of experience, both
• 2:18
  with BELAY and otherwise in bookkeeping? I'd love to talk
• 2:21
  about some of we all like to think about mistakes. What are
• 2:24
  the some of the more common mistakes that small business
• 2:27
  owners are making when it comes to bookkeeping?
• 2:29
  Duff Tucker: Yeah, I think probably the biggest mistake
• 2:31
  that a small business owner makes when it comes to
• 2:33
  bookkeeping is thinking that it's best for them to be
• 2:36
  managing it.
• 2:38
  Matthew Jarvis: Are you? Have you been to my house? Is that
• 2:39
  what this is about? Personally, It's exactly like that.
• 2:43
  Duff Tucker: So really, the mindset is, hey, I can do it.
• 2:46
  And when you're a small business owner, and I come from a small
• 2:48
  family business, so So I understand the whole need to
• 2:52
  wear multiple hats, and to kind of want to know everything
• 2:54
  that's going on, and bookkeeping is a very important thing. And
• 2:58
  so they tend to lean into. Well, it's really important, so I
• 3:01
  should be involved in it, but it's typically not the best use
• 3:05
  of their time. It becomes very time consuming because it's not
• 3:08
  something that they specialize in, so it takes them longer to
• 3:10
  do it, which takes time away from things that they do
• 3:13
  specialize in, and really aspects of their business that
• 3:16
  only they should be focusing on. And so it kind of hinders the
• 3:20
  business in the long term. So really, when, when the business
• 3:24
  gets to a certain size, it's really good advice for the
• 3:28
  business owner to start looking at, okay, what are the things
• 3:30
  that I'm doing that I probably shouldn't be doing one of the
• 3:33
  things I'm doing I hate doing, what are the things I'm doing
• 3:36
  that only I could be doing? And then, kind of taking that
• 3:39
  inventory will really help you find some directions where,
• 3:42
  like, hey, I need to, I need to get this off my plate and get a
• 3:46
  trusted advisor, trusted professional subject matter
• 3:49
  expert in here, that that can take care of this for me, that
• 3:52
  will give me that clear vision. Because without a clear
• 3:55
  financial picture, you really can't make educated decisions
• 3:59
  based on your business, with regards to scaling, with regards
• 4:02
  to budgeting, all of that. So so it's very important.
• 4:05
  Matthew Jarvis: Yeah, I got a funny bookkeeping story for you.
• 4:07
  I didn't tell you this one. I just was reminded of this many,
• 4:10
  many years ago, early in my career, we were audited by the
• 4:13
  state of Washington, where I practices, the Department of
• 4:15
  Financial Institutions. Every state has one of these, and
• 4:18
  they're going through their audit, and towards the end of
• 4:20
  the audit, they say, Hey, we need to see a copy of all of
• 4:23
  your receipts and payments they've been making. And I said
• 4:27
  to him, I said, I really screwed that up. I We don't have those.
• 4:30
  Like, I didn't know I was supposed to keep them. And they
• 4:31
  said, Well, we're gonna let this slide but, but you need to, you
• 4:35
  need to keep these. You need to have all these. Is one of the
• 4:37
  state laws for financial services companies. So I get
• 4:40
  done with the audit, and I go and I go and I meet with my
• 4:41
  bookkeeper. I have bookkeeper the time. And I said, Hey,
• 4:43
  listen, we got to start doing this. It's really important that
• 4:45
  we have this. And she says to me, she says, Jarvis, have you
• 4:48
  never looked in the closet those boxes that have years on them?
• 4:51
  That is all of the receipts from all the bookkeeping I've been
• 4:54
  doing. I've been I've been doing this for years. And so I called
• 4:58
  the auditor back, and I said, I found these. I'm a little
• 5:00
  embarrassed. We actually do. We do have them all. So I think I
• 5:03
  mentioned that. It's a funny story, but a lot of times, as
• 5:06
  business owners, we don't realize how bad the book came it
• 5:10
  is until we're faced with an audit, or until there's fraud,
• 5:14
  because there was so much going on. And I guess, I guess the
• 5:16
  third one might be in depth. Love your thoughts here. It
• 5:19
  might not necessarily be like, outright fraud. It might just be
• 5:21
  like, money's been draining out the back door, like, like,
• 5:24
  literally the fastest run running behind the building, and
• 5:26
  nobody noticed that the water bill had quadrupled because you
• 5:29
  just weren't looking at but I'd be curious, what have you seen
• 5:31
  there, Duff?
• 5:32
  Duff Tucker: Yeah, I see the exact same thing. So a lot of
• 5:35
  times in business, they're running the business off of a
• 5:37
  lot of assumptions, like, hey, yeah, if I'm an electrician and
• 5:41
  what? Let's say I'm using a certain gage electrical line to
• 5:45
  do certain jobs every day. And I'm assuming that at one point
• 5:48
  in time I could get, you know, 10 jobs out of a school of
• 5:51
  electrical line, yeah, then something changes, and I'm only
• 5:55
  getting five, five jobs out of the School of Electrical line,
• 5:59
  you know, without regularly checking the numbers that that
• 6:03
  can happen. And to your point, the waters leaking, and you're
• 6:06
  not even realizing how much water.
• 6:07
  Matthew Jarvis: Yeah, I think another place that comes in
• 6:09
  Jeff, having having a bookkeeper, having someone
• 6:11
  independent, is, you know, money is obviously very emotional,
• 6:14
  right? As financial advisors, we get that because we're working
• 6:16
  with clients. But sometimes we think that, like, Hey, I'm not
• 6:18
  emotional about my money. But yeah, 100% we are, in fact, my
• 6:22
  my bookkeeper, who's been my bookkeeper for many years, she
• 6:24
  called me their day. She says, hey, there was this, this
• 6:27
  charge, you know, $800 it was kind of unusual. I didn't really
• 6:30
  expect that. And I said, Oh, well, I'm trying this thing, you
• 6:33
  know, whatever is probably not a big deal. She says, Well, this
• 6:35
  is the third month we've been charged this. Did you really
• 6:37
  want to pay $3,000 and just some quick math, if you keep going,
• 6:41
  it's going to be 12,000 before the end of the year. Is that
• 6:44
  really what you want to do? That's actually not at all what
• 6:46
  I didn't think about it being $12,000 I thought about being a
• 6:49
  couple of bucks. And so to have somebody who can see that and
• 6:52
  draw attention to that, that's a game changer. But I would
• 6:54
  imagine you've seen some of those as well, Duff.
• 6:57
  Duff Tucker: Yeah, no, absolutely. Again, it comes down
• 6:59
  to being stretched so thin, but you don't have the time to look
• 7:03
  at, look at the reporting. And so when you have it, when you
• 7:06
  have a bookkeeping professional that's in those books every day,
• 7:10
  and and quite frankly, there are some people that actually they
• 7:13
  like collecting receipts. They like entering those numbers,
• 7:16
  crazy that way. And they become bookkeepers and and so they like
• 7:20
  compiling all that information. They like looking at the
• 7:23
  numbers. They like finding those inconsistencies, and then they
• 7:26
  like bringing it to your attention. And so when you have
• 7:28
  that trusted advisor that's really able to focus the time
• 7:32
  and energy needed to identify discrepancies, identify
• 7:36
  anomalies, and then pointed out to you and say, Hey, did you?
• 7:40
  Did you know that this is actually trending up month over
• 7:44
  month for the last six months? We should maybe take a look at
• 7:46
  that. Yeah, it really, it makes you so much more efficient. And
• 7:50
  you really know where your money is, where it's going and where
• 7:52
  it's coming in from, and we all need that for sure.
• 7:55
  Matthew Jarvis: Yeah, we definitely do. We do. And you
• 7:56
  mentioned this a couple of times, right about your your
• 7:59
  time and your energy, right? This is entrepreneurs. We have
• 8:02
  sort of short attention spans. We are not the kind of people
• 8:04
  that like stacking those up. And so on the one hand, there's the
• 8:07
  soft dollar ROI that it's freeing up a lot of my time and
• 8:10
  my mental energy. But I think a lot of times, there's also a
• 8:13
  hard dollar ROI in that when I'm going to do my taxes each year
• 8:16
  with my accountant, if I hand him or her just this massive
• 8:20
  receipt, then I'm going to be paying at a much higher rate.
• 8:23
  How my accountant straighten this out? Or worse, yeah, risk
• 8:26
  that it gets reported wrong to the IRS, or there's stuff that
• 8:29
  my accountant doesn't understand, so she just writes
• 8:31
  those off and ignores them. There's really a hard dollar ROI
• 8:34
  that comes in here pretty quickly.
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  Duff Tucker: Yeah, absolutely, absolutely. And I think also
• 8:37
  that misconception that bookkeeping is I only need to
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  have good books for tax purposes. That's a huge
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  misconception to obviously, you do need it for doing taxes and
• 8:51
  make sure they're done correctly, but also just to
• 8:53
  manage your business and run your business having having
• 8:56
  financial statements every month to review really goes a long
• 8:59
  way.
• 9:00
  Matthew Jarvis: Yeah, I always like to remind advisors, but
• 9:02
  really all business owners, that someday your business will be
• 9:05
  sold. Someday it will be sold now hopefully it's when you've
• 9:08
  decided to retire, and it's a beautiful internal succession,
• 9:11
  and everything's great, and you have big checks, or, heaven
• 9:13
  forbid, something happens to you. But either way, someday
• 9:16
  your business will be sold. In the longer you've had cleaner
• 9:18
  books, definitely the better that's going to go right? If
• 9:21
  you, if you're trying to scramble and clean these books
• 9:23
  back up last minute, it's not going to go very well.
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  Duff Tucker: RRight? Absolutely. Because the numbers never lie.
• 9:27
  And they paint a beautiful picture of your business, right?
• 9:29
  So, so they can show somebody that's looking to buy into your
• 9:32
  business, that maybe doesn't have experience in that
• 9:35
  industry, or what, what not. But they can paint that picture of,
• 9:38
  okay, these are the busy seasons. These are the slower
• 9:40
  seasons. These are the expenses that would all incur month in a
• 9:44
  month out with that. So they just, they paint a beautiful,
• 9:47
  detailed picture.
• 9:48
  Matthew Jarvis: Yeah, and I was, I was working with an advisor
• 9:49
  recently, and he was having his financials looked at by a
• 9:52
  potential acquirer. And one of the things that we we've at TED,
• 9:56
  Jenkins was just on our podcast talking about this. One of the
• 9:58
  things we're seeing more and more in that space is just by
• 10:00
  virtue of having a bookkeeper, the banks let off a lot of
• 10:03
  pressure. The buyers let offer pressure, because they're
• 10:05
  saying, hey, odds are these numbers are pretty dang good if
• 10:08
  you've got a bookkeeper, not perfect, but pretty dang good.
• 10:10
  Versus, again, if you're Joe advisor, and you're typing in
• 10:13
  these books yourself when you feel like it, that's often a
• 10:15
  mess.
• 10:15
  Duff Tucker: Yeah, absolutely. With banks and anybody that you
• 10:19
  might be working with, or loans or anything like that. It goes a
• 10:23
  lot further. When your books are in order and you can, you can
• 10:25
  provide clear financial statements and a clear financial
• 10:28
  history to them, versus a box of receipts, and go, This is what
• 10:32
  last year looks like, and you loan me the money. Yeah.
• 10:35
  Matthew Jarvis: Same with same with IRS audits, right? All
• 10:36
  those things add credibility. Duff. Let's talk for a little
• 10:39
  bit about QuickBooks. So one of the things we noticed that
• 10:41
  advisors, I guess, doesn't have to be QuickBooks, but
• 10:43
  QuickBooks, or that genre, if you're doing your own books,
• 10:46
  that tends to turn into, like, this giant mess, right? Because
• 10:48
  it's such a robust program, right? Where are you
• 10:51
  categorizing things? Where things going? Talk a little bit
• 10:53
  how a bookkeeper can help kind of straighten that up, or even
• 10:55
  just get it set up if it's not already in place.
• 10:58
  Duff Tucker: Yeah. So that's a great point. So most of your
• 11:00
  bookkeepers are working in QuickBooks, whether it's desktop
• 11:03
  or online, and it's really all shifting to QuickBooks Online,
• 11:06
  is it? Yeah, yeah, yeah. I mean, that's, that's the push. But the
• 11:10
  challenge with QuickBooks Online is it's, it's always evolving.
• 11:13
  It's always changing. And so if you're not in it day in a day
• 11:16
  out, it's really easy to get lost. It's really easy to make
• 11:19
  mistakes in your books because something's changed and all of a
• 11:21
  sudden, coding transactions differently. You can build
• 11:25
  classes. There are just so many different things that you can
• 11:27
  do. It's a wonderful it's a wonderful tool, but it's
• 11:30
  extremely robust, and it's, it's really not, it's really not a
• 11:35
  tool that you can kind of dabble in from time to time. I mean,
• 11:38
  you can, but you're not going to, you're not going to be
• 11:40
  efficient. With it. And so bookkeeping professional, many
• 11:44
  of them are QuickBooks pros. QuickBooks offers all kinds of
• 11:46
  certifications and trainings, and they're working in IT, day
• 11:49
  in and day out. So they're, they're aware of the upgrades as
• 11:52
  they come in, and they're also, they bring that level of
• 11:55
  experience, because you're not their only client, typically,
• 11:58
  typically, they have multiple clients, right? And many
• 12:00
  bookkeepers work with a niche so so they find an industry that
• 12:04
  they like to work with. Hey, I like to do books for dentists
• 12:07
  offices. So typically, that's the realm that they work. And so
• 12:12
  when you know a new dentist comes in and says, Hey, I'm
• 12:16
  here, my books are kind of a mess, they can clean them up and
• 12:19
  they can say, hey, I ran into a similar situation with one of my
• 12:22
  other clients, and this is, this is how we arrange their books. I
• 12:26
  think that would work really well with you as well. So they
• 12:29
  just bring a level of expertise and level of experience that
• 12:31
  you're not going to have when you're doing it yourself.
• 12:34
  Matthew Jarvis: Yeah, yeah, the best practices in there, right?
• 12:36
  Jeff, let's talk a little bit about safety, right? So
• 12:39
  obviously, when it comes to your financials, I mean, this is,
• 12:42
  this is, this is keys to the kingdom, right? But as we're, as
• 12:44
  we're looking at bookkeepers either using or not using them,
• 12:46
  what safety considerations do we need to have in place here,
• 12:50
  right? So I guess probably one of the fears is like, hey, at
• 12:52
  least if I'm the one doing it myself, maybe I didn't do it
• 12:54
  right, but I'm probably not going to steal from myself,
• 12:56
  right? How do we, how do we keep this in mind with bookkeepers,
• 12:59
  internal or external?
• 13:00
  Duff Tucker: Yeah, that's a great question. So obviously,
• 13:03
  we're virtual staffing company. All keepers are remote. What,
• 13:07
  what we do to protect our clients is, is our clients, the
• 13:10
  access that they give the bookkeepers are view only, so
• 13:13
  they have you only access to the bank accounts and and credit
• 13:18
  cards statements, so they can never hold funds or make
• 13:21
  purchases with that, because it's just you only access if
• 13:24
  they're doing bill payments. We recommend use a tool like
• 13:27
  bill.com or something similar to that, where they can set the
• 13:31
  payment off, but there's always an approver. They can never
• 13:33
  actually make the payment, so they set it up for you. You'll
• 13:36
  get an email notification, and like bill.com has a has a mobile
• 13:40
  app, so you have a notification on your phone, you can approve
• 13:42
  the payment of that bill, or you can stop it, or whatever the
• 13:45
  case may be. So there's all kinds of safety precautions in
• 13:50
  place that really help protect the client in the bookkeeper as
• 13:53
  well. Just this accountability keeps everybody honest.
• 13:57
  Matthew Jarvis: Yeah, it doesn't, and sometimes we think
• 14:00
  they hate these additional layers of safety only makes
• 14:02
  sense in big companies. I would think, well, you know, if you're
• 14:05
  a publicly traded company, but it's really at any level. Friend
• 14:08
  of mine, he had a mid sized company, the details aren't
• 14:12
  super relevant, but there was a gal on the company. Her job. It
• 14:15
  was doing bookkeeping, specifically in expense
• 14:17
  reimbursements. And so she had been doing, she had been doing,
• 14:20
  she been with a company for 15 years, have been doing the
• 14:22
  expense reimbursements, and she would take care of everyone's so
• 14:25
  if you did any kind of traveler company, a lot of travel you
• 14:27
  could bring, let's call her Nancy. You could bring Nancy
• 14:29
  your stuff, and she would do your expense reimbursement. And
• 14:32
  no problem. Well, his company got bought out by another
• 14:35
  company, and in the process of that, they were doing deep
• 14:37
  auditing of the books for this bio, and they realized that
• 14:40
  Nancy had been padding all of the expense reimbursements for
• 14:43
  every employee, in fact, over her 15 year career, and it
• 14:46
  almost been $2 million and so she was just adding extra
• 14:50
  expenses to everyone's reimbursements and then paying
• 14:52
  that to herself. And there wasn't a check and balance,
• 14:55
  because Nancy was in charge of it. She'd always been in charge
• 14:57
  of it, and had they not been bought out, she probably could
• 14:59
  have just gone her whole career and retired out with that money.
• 15:02
  But it speaks to the importance of having outside people
• 15:06
  involved who you mentioned, right? They have view access.
• 15:08
  They can put things in bill pay. They can't authorize them, but
• 15:11
  there's a lot of safety that comes there.
• 15:13
  Duff Tucker: Yeah, absolutely, absolutely. You always want to
• 15:15
  have some type of a check and balance with accountability and
• 15:19
  just kind of levels of protection in place for sure.
• 15:21
  Matthew Jarvis: I would add it and Duff, I'd be curious your
• 15:24
  experiences with this, a lot of small work with a lot of
• 15:27
  advisors also serving on nonprofit groups. Right? It
• 15:29
  might be the local community foundation, it might be the
• 15:32
  soccer club, it might be the PTA at the school. Thoughts on
• 15:35
  bringing bookkeeping in there as well. Right? A lot of times it
• 15:39
  gets pretty messy, and it is also right or for fraud, but I'd
• 15:42
  be curious your experience with bookkeeping in this nonprofit
• 15:45
  sector?
• 15:45
  Duff Tucker: Yeah, so about 50% of our clients tell our churches
• 15:48
  and nonprofits. So we have extensive experience working
• 15:52
  with churches and nonprofits. And so because we work with so
• 15:55
  many, half of our half of our bench of contracted employees
• 15:58
  specialize in working with churches and nonprofits. And so
• 16:02
  there's a little bit of a difference before profit world,
• 16:05
  in the nonprofit world, but the safety, the safety measures, are
• 16:08
  all very much the same. Our churches use bill.com to make
• 16:12
  payments. They have the view only access, and then there's
• 16:15
  always that level of accountability that that's
• 16:17
  there. So yeah.
• 16:19
  Matthew Jarvis: So I definitely would say, if you know, if
• 16:20
  you're a listener and you're sitting on one of these boards,
• 16:22
  especially if you're the treasurer of the organization,
• 16:24
  it's a great time to talk to them and say, Listen, we really
• 16:27
  need to have an outside bookkeeping service different
• 16:29
  from our CPA, because our CPA is too expensive to have do our
• 16:32
  bookkeeping, right? But let's bring someone, and let's make
• 16:34
  sure these records are clean, right? It applies if you're
• 16:37
  audited. It applies for fraudulent activity, it applies
• 16:39
  for grant applications, and it's a relatively nominal expense
• 16:43
  versus you as treasurer, right, typing in the entries for your
• 16:45
  HOA association or whatever the case may be.
• 16:47
  Duff Tucker: Yeah, absolutely. And just having somebody
• 16:50
  outside, it's not biased, yeah, that brings a lot of value as
• 16:54
  well.
• 16:54
  Matthew Jarvis: Yeah, yeah. It really does. It really does. So
• 16:56
  stuff in all of your work with business owners of various
• 16:59
  sizes, churches, nonprofits, etc. Can you think of some
• 17:01
  examples where the bookkeepers been able to bring value, bring
• 17:06
  education to the business owner that they might not have
• 17:08
  otherwise seen, right? Like beyond just putting numbers in
• 17:10
  boxes?
• 17:11
  Duff Tucker: Yeah, I think one of one of the big ones are when
• 17:14
  they're categorizing assets and separating out that depreciation
• 17:19
  stuff like that. A lot of times that gets missed when they're
• 17:22
  making their payments, whether it's a vehicle payment or
• 17:25
  whatever, they're not separating out the interest that they're
• 17:27
  paying versus the actual premium on the payment and then
• 17:30
  factoring into depreciation as well. So that can change the
• 17:33
  whole landscape of other assets and liabilities look like, for
• 17:36
  sure.
• 17:36
  Matthew Jarvis: Yeah, you know, definitely change the
• 17:37
  deductibility on their tax returns as well. They're getting
• 17:39
  those things blended together. So there's a lot of examples.
• 17:43
  Duff, can you give us any ideas like, at what point again the
• 17:46
  advisors listen this podcast? Some of them are brand new. Some
• 17:48
  of them are doing millions of dollars of revenue at what
• 17:51
  point, or rule of thumb of when to bring in a bookkeeper?
• 17:54
  Duff Tucker: Yeah? So typically, we'll start working with clients
• 17:58
  once they're running around that 200,000 Yeah, range, they're
• 18:03
  bringing in 200,000 revenue a year. Sometimes we'll do setup,
• 18:07
  we'll like, set up bookkeeping accounts for people. And so
• 18:11
  we're just getting ready to start testing a new product,
• 18:13
  which is either a setup or cleanup. And so that's a three
• 18:16
  month or a six month process where we could, we could set up
• 18:19
  the books. And so that could be a good fit for a really small
• 18:22
  just, just getting started business, where they're like, I
• 18:24
  don't know. And we could set up the books for them and and then
• 18:28
  kind of handed over to them to manage the other product would
• 18:31
  be a clean up where they like, I'm pretty good at managing my
• 18:33
  books. I just need to get them caught up, and so we can clean
• 18:36
  it up and then hand it over that way too. And so for less than
• 18:39
  that 200,000 annual income. Those products are great food.
• 18:44
  And then once you get beyond that point, you may want to
• 18:46
  start looking having somebody doing these month in a month
• 18:50
  out. You can, you can have a bookkeeper do quarterly books
• 18:53
  for you too. You can do it every six months for you as well. So
• 18:57
  so just depending on how large you are and how you know how
• 18:59
  many transactions you're managing month in and month out,
• 19:03
  would really determine the scope of hours, and that's part of our
• 19:07
  onboarding process to we do what's called the discovery
• 19:09
  call, where we just do a deep dive into how the books are
• 19:12
  currently being managed, what's working well, what's not working
• 19:15
  well, what you'd like to see. And then, depending on how many
• 19:19
  bank accounts, how many transactions, what the revenue
• 19:22
  determines, what the scope of hours would look like where, you
• 19:25
  know, maybe they need a bookkeeper for six hours a
• 19:28
  month. Maybe they need one for 20 hours a month.
• 19:31
  Matthew Jarvis: Sure, sure. Yeah. I'm glad that you
• 19:33
  highlighted. It's a relatively low number. Sometimes we think,
• 19:35
  well, once I get to x millions, then it makes sense. And unless
• 19:38
  you're a w2 advisor, so if you're an advisor, so if you're
• 19:41
  an advisor, listening to your w2 on someone else's platform, all
• 19:44
  right, there's really not a lot to do there, but if you're 1099,
• 19:47
  anything, yeah, to get those books set up correctly makes a
• 19:50
  big difference. What are some things that business owners can
• 19:52
  do to make the bookkeepers life easier? So we joked about like,
• 19:55
  Hey, here's this shoebox full of stuff. And, yeah, that's
• 19:58
  literally their job to take care of it, but you're paying that
• 20:01
  person by the hour or some sort of project basis, if you hand
• 20:03
  them a bunch of crap, or if you're using your personal
• 20:06
  credit card for all the expenses and you're trying to peel out
• 20:09
  which one of the business ones, there's things you can do to
• 20:12
  make it easier harder. I'm just wondering. Those come to mind
• 20:14
  for you, Duff?
• 20:15
  Duff Tucker: Yeah, that's a great question. And so we
• 20:17
  always, we always coach our clients that, let's try to set
• 20:20
  up a 30 minute meeting once a week with you in the bookkeeper,
• 20:23
  they can ask questions. You can ask questions, and typically we
• 20:27
  coach to that. It's about a 90 day onboarding process. So that
• 20:30
  first 30 days is really making sure the bookkeeper gets access
• 20:33
  to everything they need, so they can deep dive into the books and
• 20:37
  see what needs to be done. And then in that first month, they
• 20:40
  have access to everything. They get an understanding how the
• 20:43
  books are being managed. And then they can make some
• 20:46
  recommendations, whether it's a there's some cleanup work that
• 20:49
  needs to happen here, or this isn't, this isn't really being
• 20:52
  categorized quite correctly. Let's look at your chart of
• 20:55
  accounts and make some recommendations on how to do
• 20:58
  that. But they can usually, they can usually cast a vision of
• 21:01
  what it looks like to get those folks up to date, so that the
• 21:04
  clients getting reporting month and month out, but having a
• 21:07
  weekly meeting, having wheels coach to have a certain day of
• 21:10
  the week that you pay bills and so, yeah. So whether it's we do
• 21:14
  this a lot with with churches and nonprofits, where, like,
• 21:17
  hey, Wednesdays we pay the bills, and we need them all paid
• 21:20
  by 2pm Well, when you have a fractional bookkeeper, they can
• 21:23
  meet that goal. They just just can't be affecting call, right?
• 21:26
  Yeah, just send them an email, expect a response five minutes
• 21:29
  later, especially if you only have, like, five hours a month
• 21:33
  access to them, and that's all you really need. You just have
• 21:36
  to be efficient on how you work with them. So a weekly meeting a
• 21:39
  certain day of the week. Were you doing? Were you doing bill
• 21:42
  payments? If we're if we're managing payroll that that
• 21:45
  usually falls, you know, twice a month on a Friday. And so making
• 21:49
  sure they have access to everything they need. I always,
• 21:52
  we always coach our bookkeepers to send a recap and say, Hey,
• 21:55
  this is all the things that I was able to accomplish. These
• 21:58
  are the things I need you to provide me with, and then
• 22:01
  finding out how you like to communicate. Do you like to
• 22:04
  text? Do you like to email? Do you like to slack? And then
• 22:07
  having the bookkeeper kind of accommodate that communication style.
• 22:10
  Matthew Jarvis: So that makes a lot of sense, and I love that
• 22:12
  the time blocking, right? That's classic. We call that surge
• 22:15
  meetings, right? Is there in front of pay bills. Otherwise,
• 22:17
  what ends up happening, whether it's you doing it or team member
• 22:20
  doing it. They sort of just do it whenever, which means it's
• 22:23
  burning up a lot of time. Things are getting forgotten. They're
• 22:25
  getting missed. If you say, listen every other Wednesdays,
• 22:27
  when we pay bills every Wednesday, depending on the
• 22:29
  frequency of your things, right? Let's just do those all at once,
• 22:33
  Duff, shifting gears, just a little bit bookkeeping if you're
• 22:36
  acquiring or joining another practice, right? So you know
• 22:39
  we're talking about keeping is the business owner keeping your
• 22:42
  books clean. But what about if you're looking to acquire
• 22:45
  someone else's practice or become someone else's is that a
• 22:47
  spot where you might say, Hey, listen, like, I'd like to have
• 22:49
  my bookkeeper actually just kind of poke through here, not
• 22:51
  necessarily as an audit, per se, like this isn't a forensic
• 22:54
  audit, but odds are that guy or gal has this shoebox full of
• 22:57
  stuff. I mean, how do you help somebody clean up their books if
• 22:59
  you're interested in working with
• 23:00
  Duff Tucker: So if I'm looking to acquire a business and they
• 23:03
  have their own bookkeeper, yeah, what does that look like? So I
• 23:06
  would, I would ask for their reporting for like, six months,
• 23:09
  yeah, and kind of take a look at that, see if we could get access
• 23:13
  to just look at how they're doing the books through
• 23:15
  QuickBooks, and really just kind of doing an audit that way,
• 23:18
  where I, when I when we're hiring bookkeepers, I always
• 23:21
  tell people. I always tell my bookkeepers is typically two
• 23:24
  clients. So there's the client that has been doing their books,
• 23:28
  and they have a process in the system in place, and they're
• 23:31
  looking for you to come in and kind of wrap your arms around
• 23:34
  the current process, learn, learn it and understand it, and
• 23:37
  then you can make suggestions, and then, and then there's the
• 23:40
  client that has a box of receipts, and they're like, I
• 23:43
  don't know it's a it's a big mess, and I just need you to
• 23:46
  come in and take charge and take it over. And so I would gage it,
• 23:49
  coming in and taking over business. I would gage it that
• 23:52
  way, like, which, which client are you? Are you the client has
• 23:55
  as a process that's been working really well for you, for you,
• 23:58
  the client that really doesn't have a process and means one.
• 24:01
  Matthew Jarvis: Yeah, no, that makes a lot of sense. Well, I
• 24:03
  love that. Well, definitely appreciate you taking time to
• 24:06
  kind of walk through this bookkeeping process with us.
• 24:09
  It's, it's definitely one of those many things in a business
• 24:11
  where I would just assume it doesn't exist, right? Like, if
• 24:14
  magically, there was always money in the bank account and it
• 24:17
  was always, you know, some magic account, that'd be great. But
• 24:20
  that's not how it works, right? It's, that's how your business
• 24:23
  goes around. So the bookkeeping has got to be really tight. So
• 24:26
  let's talk about a couple of action items. This podcast is
• 24:29
  about taking action. Of course, first and foremost, come see our
• 24:32
  friends at BELAY at the Retirement Tax Services Tax
• 24:34
  Summit, September, 25 through 27th excited to have BELAY there
• 24:37
  again. I know the Lisais going to be there again, which was
• 24:40
  gracious the CFO a and actually took time anyone who wanted to
• 24:43
  look through their PNL and offered her expertise, which was
• 24:45
  absolutely invaluable, but definitely actions that come to
• 24:48
  mind for our listeners.
• 24:49
  Duff Tucker: One of the things that we, that we do, is we'll,
• 24:52
  we'll offer a free financial consult where we can, we can
• 24:55
  take a look for you at your books, and so if that's
• 24:57
  something you're interested in or if you have the opportunity,
• 25:01
  whether it's with BELAY or somebody else's offering that's
• 25:04
  a respected and trusted, trusted business, and they're offering
• 25:07
  something like I think it's always worthwhile to have an
• 25:10
  outside set of eyes take a look at how your business is
• 25:13
  operating and make some recommendations. It doesn't mean
• 25:16
  you have to act on it or agree with it, but, but always, you
• 25:19
  know, having an extra set of eyes looking at something for
• 25:23
  you. Good could bring things to light, good to bring ideas out
• 25:26
  that that you hadn't thought of and and really improve your business.
• 25:30
  Matthew Jarvis: I love that we'll put a link to the show
• 25:32
  notes, or in the show notes, we'll put a link to how to get
• 25:37
  that that schedule because, because why not take advantage
• 25:41
  of of that second opinion. Last Action I would give for all of
• 25:46
  my fellow advisors, again, bookkeeping is not necessarily
• 25:50
  something that's on the top of your list. The top of your list,
• 25:54
  your most favorite thing. It's something that's got to be
• 25:59
  clean. I've worked with a lot of advisors, a lot of small
• 26:03
  business owners over the duff. I know you're the same, and too
• 26:07
  often, bookkeeping doesn't come to the top of the list until the
• 26:12
  things on fire. Again, we talked about the beginning episode,
• 26:16
  until there's an audit, until there's a fraudulent issue,
• 26:21
  until you're going to sell your practice or try to get
• 26:25
  financing, and the bank or the auditor, whomever says, No, this
• 26:29
  is a mess. These aren't books. This is just a pile of garbage.
• 26:34
  That's when you'll wish that it was done, and by then, the
• 26:38
  damage has been done. But if you go back to the bank or the
• 26:42
  auditor and say, hey, it's clean now, it's not going to count,
• 26:47
  like if you come in and say, hey, it's clean already. So
• 26:51
  absolutely Duff. Really appreciate your time today for
• 26:55
  all of our friends, be sure to check out in the show notes how
• 27:00
  to get more information on BELAY, both their bookkeeping
• 27:04
  services and their virtual assistant services. Thank you so
• 27:08
  much. And for our listeners, until next time, happy planning.
• 27:12
  Today's episode is brought to you by growth, not just anyone's
• 27:17
  growth, but your growth, more specifically, the growth of your
• 27:22
  net income, that's right, the money that lands on your tax
• 27:26
  return, the money that goes home to your family, growing revenue,
• 27:31
  doubling it in the next 12 to 36 months. Now, why that range?
• 27:35
  That is the range where Micah and I have, both in our own
• 27:39
  practices and in hundreds of advisor practices we've coached,
• 27:44
  been able to double their net revenue. That's a bold claim,
• 27:48
  but it's backed by a lot of experience our own. And again,
• 27:52
  the practices we've coached go to theperfectria.com/grow to
• 27:57
  learn how we can help you double your practice like we've done
• 28:01
  for so many others.