Balancing Your Work Life And Your Personal Life

When it comes to work-life balance, Americans often times struggle. CBS News recently reported, “workers are leaving more than a week of paid time off on the table!” Americans take less time off than any other developed country in the world. When compared to our friends across the pond in Europe, who are legally required to take a minimum number of vacation days, Americans are seriously lacking.

Are Americans afraid to take days off? Do we fear we will lose our jobs if we do? Or are we just so busy that we can’t find the time?

The answers to those questions vary depending on the employer and the culture that has been created in the workplace. Maybe your employer offers little vacation time, and you are afraid to take days off. Are you are in a high power position and feel stressed when you do take time off? Or maybe the top executives do not use their vacation time, so the employees feel obligated to follow suit.

Balancing your work life and your personal life is something that Americans need to get a better handle on. Not just to have more fun, but to also have a healthier lifestyle. As CPAs we see all kinds of stats related to our industry and we pay extra attention to ones such as this: 62% of Big 4 CPA Firms retiring partners die within 10 years of retirement. With retirement between ages 55 and 60, this is an alarming stat – especially to us as a CPA Firm! However, we think we have a solution to a healthy work-life balance for our Principal Members and our staff.  Unlimited PTO.

The LBAHS Way

Our firm offers our employees Unlimited PTO. You probably have the same question most of our employees have when hired, “Sooo, what does unlimited PTO mean?” The answer is very simple… exactly as it sounds. Our employees do not need to feel stressed about tracking and planning their days off – we understand that life happens and our employees deserve that freedom. Employees understand work needs to be done and the system should is not to be abused. With this freedom we have found a higher rate of productivity and a happier work place environment. We have also found this as a way to attract and retain top talent, and the importance of that in today’s CPA industry cannot be understated!

If you are looking for a better work-life balance, take a look at your company’s vacation plan and see how it fits the lifestlye you want for you. If you are in a position of power, you may want to think about other options or solutions to give your employees more freedom and help them maximize their potential both in their work life and in their personal life. We found our win/win solution for our work-life balance, can you?

Top 25 General Contractors in the Triad of North Carolina

Congratulations to the top 25 general contractors in the Triad as reported by the Triad Business Journal! This ranking was based off of 2014 billings in the Triad including Greensboro, Winston-Salem, High-Point and surrounding areas.

The Top 25 General Contractors in the Triad region are:

1. Samet Corp.

2. Thompson Arthur Division of Apac Atlantic

3. Landmark Builders of the Triad

4. Frank L. Blum Construction Co.

5. D.H. Griffin Wrecking Co, Inc.

6. Shelco, LLC

7. Lomax Construction, Inc.

8. Windsor Commercial

9. Brasfield & Gorrie LLC

10. Omega Construction, Inc.

11. D.H. Griffin Construction Co. LLC

12. Parr Construction, Inc.

13. Magnolia Construction, LLC

14. Davie Construction Co., Inc.

15. New Atlantic Contracting, Inc.

16. Signature Development Group, LLC

17. Wishon & Carter Builders, Inc.

18. Whiting-Turner Contracting Co.

19. Sterling Building Group, Inc.

20. LMI Builders, Inc.

21. Miles-McClellan Construction

22. Ramey, Inc.

23. H.M. Kern Corp.

24. D.H. Griffin Infrastructure, LLC

25. Holden Building Co., Inc.

To see the full breakdown of the top General Contractors in the Triad region, click here. Our team would be happy to make an introduction to one of these companies if needed. Contact us today!

How Well Do You Know Your CPA Firm?

How well do you know your CPA Firm? Can you honestly say that your CPA is a partner in your success and that of your business? These two questions should produce the same answer: “Well enough to be confident in our collaborative success.” If this is not your answer, you may want to think about rekindling the flame between you and your CPA firm.

The relationship you have with your accounting firm should exceed standard service. Strategic planning, a strong partnership, and prolonged efforts toward ensuring future financial success should be at the forefront of your relationship with your CPA. If a close relationship with your accountant has diminished, or was never established in the first place, perhaps it is time to start rethinking things. Mutual understanding and a shared work ethic between you and your CPA firm are necessary to achieving financial growth for your organization.

Below are the primary components of a healthy CPA-to-business relationship, as well as the level of familiarity required for each element to be effective.

Ongoing Strategic Planning

What type of employee benefits do you offer? How about retirement plans? Your responsibility is to maintain a healthy, positive work environment. Part of the responsibility of your CPA is to factor your employees into the strategic layout of your current and future business endeavors.

Value Service Agreement

A strong CPA firm demonstrates the desire to cultivate close client relationships. You want your conversations with your CPA to be just that – conversations. How much value are you getting out of a consultation if you’re constantly monitoring the clock, keeping a closer eye on your bill than on the pertinent financial data laid out in front of you? Ensure that the value service agreement offered by your CPA is agreeable to your budget and beneficial to your finances. Work closely with your accountant to determine the plan that works best for YOU.

Growth Conversations

Are you and your CPA overdue for a growth conversation? You and your accountant should work together to create a strategic growth plan based on the specific goals you’d like to achieve in the future. Would you like to expand your business, or are you trying to downsize? Are you going to leave your business for future generations? Perhaps you are looking to sell your company. Whatever your plans may be, it is vital to converse with your CPA to determine the best formula for reaching those goals and to ensure financial security. You need an accounting team that is just as dedicated to fulfilling those plans as you are.

Long-Term Vision

What are your longstanding goals in terms of business development? Is your CPA familiar with them? Whether you’ve omitted this important information, or your CPA has neglected to ask, these objectives are vital in creating a strong and stable plan for your financial future.

Constant Connection

Your financial consulting needs will fluctuate from month to month, year to year, and so on. Regardless, contact with your CPA should not slip through the cracks during periods of lesser urgency. Both you and your CPA firm need to maintain a close relationship throughout the year. Communication is key!

There are several factors that contribute to your long-term financial success, but none of them are effective unless a sturdy foundation is established between you and your CPA firm. If you don’t feel as though a real closeness exists, all subsequent interactions are going to be out of sync with your future financial plans. To set and satisfy all of your financial goals, contact a professional CPA firm or work on strengthening the relationship with your current one.

Ready to get more out of your accounting services? Contact us to begin to understand the value of working with an accounting firm that provides much more than surface-level, mechanical tax preparation.

Wealth Transfer: Be Rational and Be Strategic!

Wealth transfer is one of the most personal topics within the financial field. Issues like estate tax and gift planning go far beyond numbers and financial records. While there is a strategic side to wealth transfer, there is also an extremely emotional one, which needs to be handled with the utmost delicacy. If you’re looking to solidify the best course of action for your wealth, you should work with a CPA firm that understands not only the financial aspects of wealth transfer, but also the emotional and psychological ones.

Before entering into the wealth planning process, it’s a good idea to familiarize yourself with these two very distinct sides of wealth transfer – emotional and strategic – and understand that each must be taken into consideration before any concrete plans are established.

Wealth Transfer: The Emotional Side

Wealth transfer processes delve into the innermost dynamics of your personal and familial history: They may reopen old wounds, unravel intricate family histories and bring to light issues you might have preferred remain buried.

So, before a CPA firm jumps into any structural planning, it must navigate the personal side of your plans for your wealth. Dedicated solely to the safety and wellbeing of your wealth, a CPA offers you a more objective opinion – one that isn’t influenced by family history. How you transfer your wealth is ultimately your own decision, but a CPA helps to compartmentalize your thoughts, see things rationally and consider future consequences.

Wealth Transfer: The Strategic Side

Once a client’s personal matters are carefully sorted through, a CPA begins developing the best course of action for the client’s wealth. When it comes to this more strategic, tactical component of wealth transfer, a CPA typically provides three options:

Wills

A will is a legal declaration containing your instructions and wishes for your property and assets to be distributed after your passing. It is one of the most uniform options for wealth transfer and remains the most basic estate plan. The downside to a will is that estates typically fall into probate and are thus subject to estate taxes.

Gift Planning

A gift or asset transfer to children or other beneficiaries may help reduce your taxable estate. You may gift, tax free, up to $14,000 per recipient per year – or $28,000 per recipient for married couples if you combine gifts. Additional gifts require the filing of a gift tax return.

Medical Or Education Gifting

If you pay someone’s medical or education expenses directly to the service provider, you make this payment as an extra gift. For example, if you write a check for tuition directly to a grandchild’s school, you can still gift that grandchild the annual per-recipient amount.

529 College Plans Gifting

You can contribute to a child or grandchild’s 529 college savings plan as your annual gift. In fact, with college gifting, you have the option of contributing up to five years’ worth of annual gifts in one year ($70,000 per person or $140,000 per couple) to one person.

Trusts

A trust may enable you to better meet your estate planning goals. There are several types of trusts:

  • Irrevocable Life Insurance Trusts
  • Charitable Trusts
  • Revocable Living Trusts

Trusts help transfer wealth, but they also keep a portion of your estate out of the probate, therefore minimizing your estate taxes.

Wealth transfer is a process that must navigate strategic as well as emotional realms to be successful. You want to partner with a CPA firm that not only is knowledgeable about the financial side of wealth transfer, but also acknowledges the emotional aspect – and takes the time to work through the two together, always with your best interest at heart.

LBA Haynes Strand provides personalized service that reflects the high standards we demand of ourselves. Our caring, competent and client-focused staff are eager to assist you and start planning your financial future. Contact us for a no-cost consultation today!

How Do I Value My Company?

There are two main ways for business owners to value their company. One is through a business valuation and the other is through a calculation engagement. In a business valuation engagement, the answer is expressed as a conclusion of value. While in a calculation engagement, the answer is expressed as calculated value. For this blog we will focus on the calculation engagement.

This service does not provide a full conclusion of value, but rather a reduced calculation of the value of a company. In addition, the calculation engagement does not provide the same level of assurance as a valuation. However, it is a viable and less costly option. However, there are certainly situations where a calculation engagement is beneficial and we will list those below.

As stated in the NACVA Professional Standards, “A Calculation Engagement occurs when the client and member agree to specific valuation approaches, methods, and the extent of selected procedures and results in a Calculated Value.” The resulting calculated value should not be used for any other purpose or by any other party for any purpose.

Situations Where a Calculation Engagement Is Beneficial
  • Buying out an internal partner
  • Buy or sell insurance needs
  • To fulfill bank needs
  • To get a rough estimate of the fair market value of your company, should you be in the process of deciding to sell
What Is Delivered

This service provides the client with a 15-30 page report on the things that are driving the value of the company. It can be used as a strategic way to look at your value today and make changes over a period of time in order to drive the value higher.

How you value your company is up to you. We recommend considering a Calculation Engagement by a Certified Valuation Analyst (CVA).  Contact the CVA professionals at LBA Haynes Strand for your no-cost consultation!

5 Tips to Buy Out a Business Partner

Buying out a business partner can be an intimidating venture, sometimes a messy one. However, when both parties are aware of the situation, and both parties mutually understand the process as well as the value of the company – it can be much easier.

We have identified 5 tips to make the buying out a business partner a smooth process for both parties. 

Tip 1: Make Sure To Get A Buy/Sell Agreement In Place

Make sure up front when the company is started or as soon as you read this to get a buy/sell agreement in place.  This is a legally binding document between the owners of the company.  This document agrees to certain parameters if something should happen to one of the owners, such as: death, disability, divorce, or that they simply disagree and want to leave the company.  If you have one of these agreements already – consider yourself lucky!  Without a buy-sell agreement the rest of these tips and process might be more challenging.

Tip 2: Be Rational And Realistic

Whether you are the buyer or the seller, this may feel like your “Baby” that you are selling to your other partner…..but it’s NOT.  Treat it as you would any other business transaction, keep emotions out of it, or you may find yourself in a dead end where no one can agree.  If each person has 10 things they want out of the buy out, getting 6 to 8 of those things may be realistic – but certainly not all 10.

Tip 3: Get A Valuation Of The Company

Do not simply agree on a price as the buyer or the seller.  This may lead to hard feelings in the future if the company grows exponentially or if the company fails.  Either way the buyer or seller may feel they got the short end of the stick.  A valuation will help you agree that someone independent of the company and properly licensed has provided you a fair market value of the company.

Tip 4: Get An Attorney To Draft The Buyout

You want to get an attorney that is familiar with mergers and acquisitions to draft the buyout.  Even if the parties agree on all terms, getting it properly and legally documented is critical to the process.

Tip 5: Funding Is Available

There is funding available, it doesn’t have to be out of current cash or future cash flow.  The SBA has products available that are fixed term 7-10 year notes at competitive interest rates that allow one partner out in the small business space.  This allows the owners to part ways completely and not have to stay in each other’s business because they owe each other money.  It provides a cleaner break between the two parties.

LBA Haynes Strand has the experience to provide you the fair market value of your company. Our team of Certified Valuation Analysts (CVA), are well versed in buyout situations and can help both parties seek the proper resolution they deserve. To receive a proposal for the valuation of your business – CLICK HERE – and our team will reach out within 24 hours!

Property Management Companies Are Growing Through M&A

Mergers and Acquisitions have become an increasingly popular growth strategy among property management companies. In an earlier blog titled, “What Industries Are Growing Through M&A,” we mentioned property management companies as a top industry for mergers and acquisitions. So let’s dig a little deeper and learn what is being gained by M&A and what trends are driving M&A in the property management marketplace.

What Property Management Companies Are Trying To Gain Through M&A:
  • Size/Proximity to New Locations: In some cases, especially in the Charlotte area, management companies are looking to grow across State lines.  Rather than a Charlotte based management company opening a new location in South Carolina, they will often acquire other established management companies already based in South Carolina.  This is also true within the State as well (Charlotte -> Greensboro, Wilmington, Raleigh, etc.)
  • Economies of Scale: Management companies deal with many different service providers from landscapers and painters, to accountants and attorneys.  As management companies grow and manage additional communities through M&A, they are better able to pass cost savings (via economies of scale) onto their clients.  Doing so, theoretically, makes the management company more attractive in the market place as they are better able to offer attractive rates.
  • Additional Management Offerings: There are many local management companies who specialize in residential communities while others mainly do commercial associations.  Through M&A, management companies may be able to acquire residential work if they didn;t already have it, or vice versa.
What Trends Are Driving M&A In The Industry:
  • Real Estate Brokers Wanting Out: Community management is NOT a glamorous field. In lean times (2008 – 2012) many small/local real estate sales offices turned to property management when they were struggling to sell homes. With real estate “Hot” again, some real estate agents are looking to shed their portfolio of community associations to better focus their efforts on more lucrative selling activities.
  • Lack of Succession Planning: Similar to the CPA industry, some “mom and pop” community management companies simply have no succession plan, while other “younger” management companies are seeing this as a great opportunity for M&A.
  • National Players Coming To Charlotte: Up until 2008, community management in Charlotte was pretty much locally run (i.e. 20 or so management companies throughout the State and SC, perhaps). However, in the past 5 to 7 years, Charlotte has experienced an increase in nationally known management companies who often launch their local office by purchasing a locally-owned community management company.

This may be un-chartered territory for some management companies, and LBA Haynes Strand is here to help. We have a team that understands the needs and the financial issues associated with HOAs and property management companies. If your property management company is looking to grow through M&A, schedule a no-cost consultation with us and we will walk you through the steps for a successful merger or acquisition.

4 Reasons Why Now is a Good Time to Acquire a Company

Are you considering acquisition as a way to begin or expand your business? There are a number of reasons why it is one of the best times to acquire a company:

 1. Supply and Demand

As The Baby Boomers are exiting their companies – there are lots of sellers, but there are not as many buyers as there were 10 years ago – so the selection of businesses is better than in the past.

2. Capital Availability

The Private Equity Groups, Private Investors, and Banks have more money on the sidelines that they want to put to use in the market place than ever before. In addition, interest rates are still at historic lows – so borrowing capital for an acquisition can be done very efficiently.

3. Larger Companies Are Worth More

Acquiring 1 to 3 competitors and building your current company may change the multiple you get on an exit from 4x to 6x of EBITDA. The big difference here is that you may be buying a smaller company for 3x the earnings and later as you combine it with your business and thus resell a larger business in the future, you may be able to get a rate arbitrage on your purchase. Thus, the same business you bought for more than 3x.

4. Strategic Savings

If you already own a company in the given industry and you acquire another one – the savings could be 5-25% on expenses for the combined company. This means you could add more profit and cash flow than the prior owner. There are many different expense categories that would overlap, and when you combine companies you would not have to pay it twice.

M&A Tip: As you look to acquire or buy a business make sure you are doing it for the right reasons. Don’t just say, “I want to get rich.” That line of thinking probably won’t cut it, unfortunately. You need to make sure you have wisdom, passion, and a sound plan for this business. Do your Due Diligence! The timing is right to acquire, it’s just up to you to follow through!

For more information on how LBA Haynes Strand can make your acquisition a successful one, contact our Capital Advisors team!