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M.A. Answers your questions:
Click a question to go there-
 1 How can Management Associates save us money?
2 How can Management Associates be so efficient?
3 What if I feel good about my bookkeeper?
4 How can I tell if my staff is qualified?
5 Why shouldn’t I manage my own accounting?
6 I have a CPA. Why do I need Management Associates?
7 How long should it take to get my periodic statements?
8 How can I tell if my statements are accurate?
9 How often should cash be reconciled?
10 How can I make sure I have enough cash to open a new store?
11 Why should I use 13-period accounting?
12 What is wrong with Quickbooks?
13 When is the best time to switch to Management Associates?
1. How can Management Associates save me money?
We can save you money in one of two ways: by lowering your total accounting costs and stopping profit leaks. Either way, you are money ahead by using Management Associates.
2. How can Management Associates be so efficient?
The core of our efficiency comes from the fact that your work is managed and performed by CPAs and accounting professionals. Efficiencies are gained because work is done right the first time. Since our people know what they are doing, they don’t spend time “spinning their wheels” or going through unnecessary exercises to look busy.
3. What if I feel good about my bookkeeper?
We’ve looked under the covers of hundreds of businesses, and in most cases there was a perception that the accounting was great. The problem lies in the fact that accounting is a very difficult science to master and understand. Most owners feel good about their accounting because they are not accounting professionals and don’t have the point of reference required to make an accurate evaluation.
The fact is that the accounting in most businesses is grossly inefficient and inaccurate, regardless of how well the bookkeepers make the owners feel.
4. How can I tell if my staff is qualified?
There is a very easy test. If your staff has a formal education in accounting and is managed by CPAs, then they are likely qualified. If not, you can be relatively certain that money is being lost by false moves, wheel spinning and profit leaks.
5. Why shouldn’t I manage my own accounting?
There are two reasons to not manage your own accounting: it is not good use of your time, and it is ultimately more expensive.
6. I have a CPA. Why do I need Management Associates?
Most CPAs are primarily tax professionals. They will often engage in bookkeeping services either as an accommodation to their clients, or as an additional source of revenue. Most CPAs look down on this type of work, and usually they assign their least qualified people to this task. The result is high cost to you for work done by disinterested and under-qualified people.
At Management Associates we believe that financial reporting is the highest form of accounting and is of the greatest interest to the entrepreneur. It is the nervous system of the business and is an essential element in being profitable and successful. We don’t involve ourselves with tax preparation because it would be a distraction from our reporting work. The only work we do is financial reporting (including bookkeeping) and CFO services. We will do the reporting work, then provide your tax accountant the numbers they need to prepare your taxes, or we will find you a tax accountant that we know is outstanding.
7. How long should it take to get my periodic statements?
The amount of time it should take to get your financial statements depends upon the nature of your business, although, the sooner the better. Restaurants should have statements within 10 business days.
8. How can I tell if my statements are accurate?
Reasonableness and consistency are the key factors. If your numbers are consistent from period to period and from store to store, this is a good indication of accuracy. Balance sheet accounts should also be periodically reconciled and verified to make sure that no one is “fluffing” the numbers.
9. How often should cash be reconciled?
Most businesses reconcile cash once a month, but we do it weekly. We also make sure that store deposits make it to the bank in a timely fashion. Frequent cash reconciliation is important to quickly identify problems before they become disastrous.
10. How can I make sure I have enough cash to open a new store?
The best way to make sure is to have a financial model that is mathematically accurate and contains reasonable assumptions. Opening a new unit will put tremendous strain on the cash flow of the business, so modeling the outcome is extremely important.
11. Why should I use 13-period accounting?
One of the best ways to tell how your business is doing is to compare results from one period to the next. The problem with using calendar months is that the periods are not comparable, therefore making monthly comparisons is less meaningful. The reason they are not comparable is because the number of weekends in each month can vary. Since many restaurants and retail businesses do most of their business on weekends, having 5 instead of 4 weekends will skew the results. With 13-period accounting, all reporting periods have four weekends, are 4 weeks long, and are therefore comparable.
12. What is wrong with QuickBooks?
QuickBooks is an amazing program, both in power and in low cost, but it is not the best program to use for medium-size businesses or businesses that should be on 13 periods. The danger lies in the fact that the program is not designed to provide strong internal controls or a transactional trail. The primary weakness of QuickBooks is that it is easy to delete transactions as if they never existed, or to create unsupported transactions. Another weakness of QuickBooks is that it is not designed for 13-period accounting.
13. When is the best time to switch to Management Associates?
There are two times to make a switch: before you are in a crisis and after a crisis has already occurred. Obviously it’s best to switch before you have a crisis. Examples of crisis include your bookkeeper quitting, running out of cash, or discovering that someone has been stealing from you.
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