Momentum Accounting, Inc.

Having profitability problems? I'll be talking about a quick and easy hack to fix your profitability by applying my 50-30-20 rule in an upcoming live event with Modern Ideas for Business Sign up here:   WHEN: OCT. 10, 2024, 10—11AM PT WHAT: THE SECRET TO SUSTAINABLE PROFITABILITY- The 3 Magic Numbers You Must Know   In this session, you'll learn a proven framework for achieving long-term profitability using a simple but effective methodology that ensures a 20% net profit margin. I’ll walk you through how to properly structure your financials for more valuable analysis, benchmark your performance, and price your services or products for profit. By the end of the session, you'll have clear and actionable steps to improve and monitor your profitability. Join me on Oct 10. (Link to sign up in comments)

Good accounting v bad accounting Here's why you should care

We are looking for more topic ideas for Cash Flow Show! (The most difficult part of podcasting 😆) The primary target audience for the show is 7 figure business owners. The secondary audience is advisors (bookkeepers, accountants, CFOs, bankers, etc) who serve small businesses. So far, we've recorded 23 episodes on the following topics: 1. Understanding COGS v OH - the foundation for a useful P&L, intro to the 50-30-20 rule 2. Strategies for getting paid faster to boost cash flow 3. Paying yourself as an S-Corp owner 4. Setting up your AP process/paying vendors/AP automation tools 5. Common payroll mistakes, payroll and benefits (401k, health ins) integrations for saving admin time 6. Building the ultimate accounting app stack! 7. Roles in an accounting department 8. The 5 KPIs every business should be tracking 9. Reporting rhythms - the stuff you should be looking at weekly, monthly, quarterly, and annually to make sure you're staying on top of your biz 10. Mistakes to avoid when buying accounting services 11. Do you reallllly need a cash flow forecast? Tips for fixing your cash flow troubles on the front end, plus cash flow forecasting methods for clients with "lumpy" revenue or constantly at risk of missing payroll 12. Marketing strategies and budgeting tips 13. Who should you hire next? 14. Can I afford to hire an employee? 15. 7 signs your business needs a controller 16. How to guarantee a 20% profit from your business, a deeper dive into the 50-30-20 rule 17. Getting your business ready to sell 18. Pricing strategies for service business 19. Creating a walkway price: understanding the basics of pricing 20. What if you have TOO MUCH cash? 6 ways to invest excess cash 21: What to do when you're RUNNING OUT OF CASH!? 22: Tired of your bank's old technology? Consider a neo-bank 23: How much should you pay for accounting? Feel free to comment here or send me a private DM. I'd love to hear from you! Also open to bring on experts in various areas of expertise. Thank you 😊 Nikole & Scotty Scotty Scarano 🥶❤️🔥 Accounting High Momentum Accounting, Inc.

Feeling overwhelmed with all the hats you're wearing as a business owner? It might be time to hire an "integrator"—a game-changing role that bridges the gap between your visionary ideas and day-to-day operations. In our latest Cash Flow Show podcast episode, Scotty Scarano 🥶❤️🔥 and I explore how an integrator can take your business to the next level, manage your functional areas, and free up your time for strategic growth. Learn the best practices for identifying when to hire, choosing between part-time, full-time, or outsourced help, and ensuring your new hire fits within your budget. Podcast Episode link in comments (Keep all lidless cups away from me or they will get knocked over and spilled)

We're thrilled to share the results we've been able to produce for our client! Here's how solid financial operations infused $558,219 into a $5M business. Profit Increase: By moving to accrual basis accounting and tracking benchmark targets around COGS and Overhead, the business was able to start making small operational changes that resulted in a 5% increase in net profit over the last 12 months DSO* Improvement: Usine our accounting department accountability matrix, we created more clarity around who is responsible for AR collections and set cadences around invoicing. We also set policies for the sales team about taking retainers, and implementing electronic payment methods, the company was able to reduce the time it takes customers to pay from an average of 45 days to 30 days DPO* Improvement: Implementing BILL and a solid bill pay process gave the company more control over their cash outflows and now they only pay bills as close to the due date as possible, resulting in increasing the time they take to pay vendors from an average of 15 days to 30 days. The result?? Total Cash Impact: - Profit increase $5M x 5%: $250,000 - Cash flow improvement from DSO reduction of 15 days: $205,479 - Cash flow improvement from DPO increase by 15 days: $102,740 Total Impact: $250,000 + $205,479 + $102,740 = $558,219 💡 Total Cash Impact: A remarkable $558,219! (*DSO is a measure of how long it takes customers to pay on average) (*DPO is a measure of how long it takes a company to pay vendors on average)

A lot of clients come to us after years of dealing with the pain of a “one-person” accounting department. They’ve been stolen from They’ve experienced the stress of urgently replacing their bookkeeper who left without notice The technology used in the accounting department lags behind the rest of the company, meaning they are always dealing with a lot of checks and manual procedures They almost didn't make payroll because no one was keeping an eye on receivables They rarely use their financials to make decisions because they receive them 6 months late They can’t get a loan or sell their business because third parties can’t make sense of the financials :-/ Did you know that a high functioning accounting/finance department has the following roles? Bookkeeper Accounts Payable  Accounts Receivable  Controller FP&A* CFO* Technology Integrator Payroll Admin Payroll Compliance Expert Sales Tax Admin Sales Tax Compliance Expert* While there are some All-Stars who may be able to handle a few of these roles, you can’t possibly expect one person to have ALL of these skill sets. In-house accountants are a thing of the past when you actually needed a human to come to your office and do data entry. Technology has made outsourcing to experts an affordable (and much better) option and no doubt it will be the standard in 5 years. ✌🏽 Niks *looking to network with experts in these areas!

Hey guys June 17th is coming up, which means estimated tax payments are due! (Yay 🤪) (Yes they are buried in that PDF your tax accountant sent you back in April) Typically when we make estimated tax payments, we end up needing to use cash from the biz, so we need to make sure we plan for this cash outflow. Here’s a process you can follow to make sure you’re planning for your tax payments ahead of time so you’re not caught in an unexpected cash crunch 👉🏽 When you receive the vouchers from your tax accountant, send all of them to your bookkeeper or controller and have him/her enter them into your accounting system along with the instructions on how to pay them For a 6/15 voucher, date the bill 6/1 The bill will show up on your AP aging a couple weeks head of time so you can consider it in your cash planning for the upcoming weeks. You will have 2 types for vouchers - businesses taxes and personal It’s generally okay to enter both of them into your accounting software and pay them from your biz account (watch video for more deets on this and what to do if you have a partner) If you have any questions about this feel free to send me a DM! Niks P.S. My team at Momentum Accounting, Inc. helps 7 figure businesses with financial operations. If you need bookkeeping or controller support, HMU. If you’re curious about outsourcing your accounting, but not quite ready you can stay in touch by subscribing to our newsletter (link in comments)

Having profitability problems? Check out this quick and easy hack to fix your profitability by applying my 50-30-20 rule You can pretty much live and die by this as your business grows. This is exactly how I run my business. I rarely look at time-tracking data or do any forecasting. Here's how to do it: Start by assessing your current margins Then run 3 simple scenarios to see what your business would look like if it was in line with the 50-30-20: Scenario 1: Align your COGS with Revenue by reducing COGS Scenario 2: Align OH and Revenue w/ COGS by investing in OH to increase Revenue Scenario 3: Combo of both (reduce COGS + Increase revenue) Then break it down by monthly revenue/costs. Now you know exactly what you need to do RIGHT NOW to get your business on track. Watch the video for full instructions. I reference another YouTube video which I'll link in the comments. Need help!!? Send me a DM! P.S. If you want more tips like this, you can sign up for my newsletter using the link in comments

Your financials are a potential buyer's first peek into your business. You only get one chance to make a first impression! If you are getting ready to sell your business, make sure to avoid these costly mistakes: -Too much customer concentration risk -Too many discretionary write-offs lowering EBITDA -Lumpy revenue (v recurring and predictable) -Financials that don't match tax returns and payroll reports -Inaccurate Accounts Receivable and/or Accounts Payable aging reports -Inventory reports that don't tie to the balance sheet -State and local compliance issues -Messy books in general If you need help getting your financial house in order before you sell, make sure to give this episode a listen on Cash Flow Show (link in comments). Messy books erode trust with potential buyers. My team at Momentum can help whip your financials into shape. Send me a DM. Scotty Scarano 🥶❤️🔥

Cash Flow Show Episode 6: Building The Ultimate Accounting App Stack Check out the full podcast episode (link in my profile) We love our apps in this community! Shout out to: General Ledger: Xero Intuit QuickBooks Invoicing / Collections / Getting Paid: FreshBooks ChargeOver Harvest Ignition Anchor CollBox InvoiceSherpa Stripe Square GoCardless Payroll: Gusto Rippling Justworks (PEO) 401K: Human Interest QSEHRA: PeopleKeep International employees: Deel Remote Employee Expenses: Expensify Ramp Divvy from BILL Vendor Payments: BILL Corpay One Veem Reporting: Reach Reporting FinDaily LiveFlow Banking: Relay Mercury Sales Tax: Avalara TaxJar | A Stripe company Anrok Sorry if I missed anyone - feel free to comment with your favorite accounting app!