Personally sign all checks, do not hire relatives, sell idle assets, use a time clock, maintain a company budget and monitor it regularly, do not run out of cash, use non-taxable fringe benefits to compensate employees, have a good bookkeeper, take out of the business only what it can afford, use a “one-write” system, prepare your financial statements on the “tax basis”, sublet unused space, debits to the left, credits to the right, dispose of obsolete or slow moving inventory, use both sides of the paper, use an outside payroll service, one credit card is enough, check credit references, bill upon completion of the work, reduce your overhead, charge interest on delinquent accounts, take all discounts, “brown bag” it, keep good records, use e-mail for billing, check employee references, get a retainer, have an IRA or SEP, keep all receipts, use independent contractors, employ part-timers, do not personally guarantee any business debts, put your kids on the payroll and set up IRAs for them, use regular gas, walk there, check your credit regularly, pay secured creditors before unsecured creditors, repay loans that carry the highest interest rates first, refinance, buy used, don’t have too much inventory, don’t have too little inventory, use a mail scale, bill frequently, do not handle your own IRS audit, take a physical inventory once a year, use E-mail in lieu of “snail mail”, do not run out of cash, do not substitute unsecured creditors with secured creditors, have a plan, know your break even in sales/income, backup regularly, have your employees bonded, know your business’s: current ratio, quick ratio, working capital, debt to equity, receivable turnover, age of receivables, inventory turnover, days supply in inventory, profit margin, prepare a will, have an estate plan, have a medical reimbursement plan, have a “529” for college expenses, file on time, pay your quarterly estimates, discontinue unprofitable lines, reduce your debt, use an LLC or “S” corporation, exercise regularly, don’t hide from creditors, drink skim milk, eat fruit, plan for the succession of your business, delegate, have a good “A Team” (accountant - attorney - insurance agent), keep a record of your automobile mileage and expenses, hand out three business cards a day, don’t drink, encourage new ideas from everyone, issue all required 1099s, know how to use Windows, Excel and Quickbooks or Peachtree, pre-number all forms, go wireless, don’t download “Beta” software, segregate cash handling from record keeping, prepare monthly financial statements, prepare a weekly and monthly cash flow projection, have a tax planning meeting with your CPA before year-end, offer a discount for early payment, pay all taxes on time, have a web site, review your pricing on a regular basis, pay payroll every two weeks, know how to compute present value and loan amortization using a business calculator, do not run out of cash.
©Copyright John D. Carrigg, CPA
