The Role of the CFO

Over time, the role of the CFO has evolved from transaction oversight to one of strategic importance. The CFO has become a true business advisor which both business owners and senior leaders rely on.

Typically, the CFO will model the owner and leader’s vision into a financial pro-forma to evaluate whether they can and will make the necessary investments (primarily financial and cultural) to achieve their goals.

Business owners need an in-house counselor, who is invested in the financial future of the company, to aid in decision making. The CFO provides resources needed to help make these decisions and “monetize” the company’s vision.

Resources the CFO provides:

Business Planning

  • Provide your business plan with financial rigor

Financial Projections

  • Create a bottom-up forecast and detailed budget with spending plans by department

Rolling Cash Forecasts

  • Enable you to respond, in real time, to emerging business conditions

Annual Operating Budgets

  • Help you keep track of maintenance operations, salaries, and interest payments

3 and 5 Year Plans

  • Forecast expenditures and revenue for three and five year periods
  • Create corresponding strategic goals

Monthly Management Reports

  • Create reports with previous and current financial data

Pricing

  • Build a financial model to set price

Managing Debt

  • Establish company budget and payment schedule to repay and keep debt low

Mergers and Acquisitions

  • Advise on M&A initiatives
  • Complete business valuation

Equity and Debt Negotiations

  • Restructure your debt to improve liquidity

Liquidations

  • Ensure proper redistribution of your company’s assets and property

With the resources they provide, the CFO is vital to driving business improvement initiatives. Not only do they want to sustain your accounting function, they want to improve it. To learn more about how our CFO Services can help you and your accounting department reach the next level, contact us today!

Celebrate July 4th In The Piedmont Triad

We are giving you some new and exciting ways to spend the 4th of July holiday in Greensboro and around the Piedmont Triad area! Check out the events below for suggestions on how you can make the most of your holiday weekend!

Friday July 3rd & Saturday July 4th
Fun Fourth Festival

Where: Downtown Greensboro – S. Green, S. Elm, Washington, & McGee Streets (click here for a PDF map)

Time:

  •  Friday: Kickoff Block Party: 7-11pm
  •  Saturday: Freedom Run & Walk: 8am
  •  Parade & Street Festival: 9:30am – 6:30pm
  •  Pops Concert & Fireworks: 7:30pm – 10pm

Description: The Fun Fourth Festival has been presented annually since 1975 as a community celebration of Independence Day for Guilford County and the greater Piedmont Triad Area. This year, over 90,000 people are expected to attend! Fun Fourth events include a Freedom Run, a Kickoff Block Party, a Parade and Street Festival, a Pops Concert, and of course, Fun Fourth Fireworks Finale. Fun Fourth maintains all of the favorite American Independence Day traditions and offers great entertainment and exhibits, many of which are free! For more information, click here.

Saturday July 4th
Uncle Sam Jam

Where: High Point; Oak Hollow Festival Park

Time: 4:30pm – Gates Open; 9:45pm – Fireworks

Description: Celebrate the 4th of July with outdoor live music, food vendors, children’s crafts, entertainment, activities, and fireworks! Parking will be available at the park and in surrounding lots. Come out and enjoy an event that is great for the whole family! **Fee is $10 per car load.

Independence Day Celebration

Where: Winston-Salem; Old Salem Historic District

Time: 9:30am – 4:30pm

Description: Join Old Salem Museum & Gardens for a special Independence Day celebration! Enjoy hands-on activities, demonstrations, music, games and more, including a moving naturalization ceremony at 10am, throughout the historic district. Historic Buildings will close at 4pm for all guests to join together in the Square for a 4:15pm re-enactment of the 1783 celebration of July 4th by the Moravians in Salem! Click here to find out more about this spectacular event!

Winston-Salem Dash Baseball Game & Fireworks

Where: Winston-Salem; BB&T Ballpark

Time: 6:30pm

Description: Spend your Saturday evening at the BB&T Ballpark cheering on the Winston-Salem Dash as they take on the Wilmington Blue Rocks! Youngsters can run the bases after the game, and be sure to sick around for the postgame fireworks show! Click here to purchase tickets.

Stars and Stripes Spectacular

Where: Greensboro; Newbridge Bank Park

Time: 6:30pm

Description: Cheer on the Greensboro Grasshoppers as they take on the Hickory Crawdads! Celebrate July 4th after the game with the Stars and Stripes Spectacular fireworks show, presented by Tanger Outlets. Get your tickets here!

These are some of the most popular events in the surrounding Piedmont Triad area:
  • Greensboro, NC: Wet ‘n Wild Emerald Pointe’s Sky Scream Fireworks Show – Extended park hours are 10am – 9pm, Fireworks at 9:15pm – emeraldpointe.com
  • Kernersville, NC: 4th of July Fireworks and Splash B4 the Blast – Swimming & Giveaways at the Kernersville YMCA, Live Music & Fireworks starting at 6:30 pm at the Kernersville Raiders football field – toknc.com
  • Lexington, NC: Fantastic Fourth Celebration – A great family event for children & kids of all ages; Fireworks begin between 9pm and 9:30pm – visitlexingtonnc.com/fantastic-fourth-of-july-festival

We hope you enjoy your 4th of July! Remember to stay safe! If you’re going to be handling fireworks, please click HERE  for important safety tips! Happy Independence Day!

business succession why

Business Succession Planning: Why is it Important?

You may know what business succession planning is but do you know why it’s important?

It’s January 5th and I get a call from a client who wants to sell their business. They had a great holiday break and decided they no longer want to run their business. They do not want to deal with the headaches, stress, and people issues that accompany being a business owner. As their business advisor, I make the following statements and ask a few important questions:

  • Have you met with your financial planner to see if you have enough to retire?
  • Do you know what your business is worth?
  • Your business had a really bad year 2 years ago. Remember, almost all buyers will look back 3 years. This will hurt the value in the sale.
  • Does your executive team know?
  • Have you thought about incentivizing them to stay with the buyer?
  • What are you going to do next?
  • Most buyers of businesses your size, will use a loan to buy the business, and will require you to be out of the business in less than a year.

The list continues during the next few discussions with the client. It’s clear they have not thought of any of these, however they want to sell anyway. During the process, the valuation is lowered by the bad year they had, and a few members of the management team leave as they hear of the sale. The transaction closes after months of trying to sell and going through due diligence with a couple different buyers.

This scenario happens every year. Business succession plans help make sure that if you wake up on January 5 and decide to sell, you have the opportunity to easily answer these questions and many more. Having a plan in place will help you maximize the exit value when the times comes, and also make the process of selling or transitioning much easier for the business.

Contact us for a no-cost consultation to find out if your business is ready to be sold.

succession plan getting started

Business Succession Planning: Getting Started

The best time to have a succession plan in place is the day you start your business. If you do not already have a succession plan in place, today is the day. While many business owners believe getting started is difficult, it is quite simple. The majority of people think it can wait because it’s too big of a topic to cover. When creating a plan, remember to keep it simple and aim for progress, not perfection.

First, business owners need to consider what would ideally happen under two scenarios, retirement and death. The first is easier to think about for a lot of people, so we’ll start with that one and cover death in another post.

When considering retirement, business owners should think about it at least three to five if not ten to twenty-five years in advance. According to the Department of Labor, it is never too early to start planning for retirement. First, talk with your advisors and family, 3-5 years out. Your team of advisors should include your CPA, Attorney, and Financial Planner.

Conversation Starters for Your Team of Advisors:
  • What is my business worth today?
  • How much money do I need in retirement?
  • What can I do between now and my retirement date to build the business valuation?
  • What do I want to happen with the business when I retire?
    • Am I passing it to the next generation of family?
      • Will it be a gift?
      • Will it be bought with cash or over time?
    • Am I going to sell it?
      • Who are the potential buyers – individual buyers, financial buyers, or strategic buyers?
    • Should I let the management team run it, but I will own it still?
      • Are they capable?
      • What type of incentives do I need to put in place to make this work?
  • What am I going to do in retirement?
    • Am I going to stop working completely?
    • Will I do some consulting or gig-economy type work?

This is the starting point. Of course, there are many subsets of questions that will drive the conversation. Discuss these topics with your family to ensure everyone is aligned about what retirement looks like from a timing and lifestyle perspective. These questions can lead down many different avenues. Your team of advisors will guide you down the path that best fits your goals. Business succession planning is far from one-size-fits-all plan and more like a custom “one-size-fits-one”. Build a plan to satisfy your desires, needs, ambitions, employees, and family.

Not sure if you have the right team of advisors in place to help? Contact us today!

succession planning

Business Succession Planning: What is it?

From the day you start your business, you are focused on both present and future growth. However, many people never think of life after the business or succession planning until it’s too late. How do you know it’s too late? Typically, business owners don’t start thinking about this until a major life event occurs, they are burned out and need to sell, or someone comes knocking and wants to acquire their business. According to a Wilmington Trust Survey, 60% of business owners do not have a succession plan in place.

None of the times previously mentioned are the best time to start a succession plan or think about it, as you are under stress. The best time to put together a plan is when you start your business. If you didn’t do it then, the next best time is today!

What exactly is business succession planning? It starts with answering a series of questions with yourself, your family, your executives, and your advisors. The purpose is to make sure what you have built in your business continues on, not just for legacy, but for the people, and families, that you are providing a job to. There are a lot of critical things to think about in a succession plan. It helps you decide what happens to your business if something were to happen to you.

Does it go to management? Does it pass to your estate? Will the business just fold up and close? How is all of this planned both structurally and financially?

A succession plan is an iterative process. Business owners need to pick it up once a year and re-read to say, yes this still fits where I am in my life and where my business is, or it needs changes.

If you are a business owner without a succession plan in place, contact us to schedule a no-cost consultation.

Delegation

Business Owners: Delegation Is The Key To Sustainable Value

Business Owners need to learn how to properly delegate roles in order to create a sustainable business. We have seen instances where business owners, who have worked as an “army of 1”, leave their business or retire and the value of the business leaves as well. If you really want  to make a difference in your employees lives and you want to create a lasting business long after you leave, you must learn the art of delegation!

Delegation is tough for some business owners. It is about empowering others to step up and make decisions on behalf of YOUR business and it is about you TRUSTING those employees to do so. Let me ask you a simple question:  Why did you start your business? Look back to when you were a wide eyed, optimistic entrepreneur. You started your business probably because you had a passion and wanted to make a difference in some kind of capacity. You have now created a successful business, one that has value and one that employs actual people! It has been successful, however you still feel the need to make every decision on your own.

What is your company going to do when you retire? Is it going to continue to run successfully or is it going to run like a ship without a captain?

If you want it to run successfully when you are gone, you must master delegation. Stop wearing every hat in the business and find people who are capable and willing to help your business grow. Find people you can trust to make the right decisions, that work within your value system and your business’ objectives. If you fail at this your business will likely fail soon after you leave.

To learn more, contact our team at LBA Haynes Strand Capital Advisors for your no-cost consultation!

Breaking: Businesses Are Partnering With CPA Firms To Run Accounting Departments

The hiring of CPA firms as the accounting function of companies is growing. Once thought to be contained to smaller businesses, the use of a CPA firm as an accounting department is spreading to mid-sized companies.  Whether it is going to be called an “epidemic”, a “pandemic”, or an “outbreak” is yet to be seen.  The good news is business owners now have options on how to run their business.  In fact they have more options than at any point in history.

What does this mean?

Mid-Sized companies are facing many of the same issues that smaller businesses are going through.  They are wanting to run leaner businesses with less overhead, and are wanting to do so more efficiently.  This means that companies are continuing to look outside their own company for help.  Sure accounting firms have been offering accounting services to companies for decades – but what is new is that we are now offering accounting solutions to business owners.

Business owners are now asking, “Why would I pay a lone individual to handle my company’s accounting duties, when I can instead hire an entire team of professional accountants at a CPA firm to handle my accounting at a fraction of the cost?”

Good question – and one that every business owner needs to ask his or herself.  Hiring a CPA firm with an accounting solutions department is the here and the now, but also the future.

Accounting Solutions: What You Need To Know

There are many benefits to hiring an accounting solutions team.  The list of accounting solutions offered include: AP management, AR management, budget development, credit card processing, financial statement preparation and analysis, payroll management, QuickBooks support, and much more!  Companies aren’t just looking to maintain the status quo anymore, they are looking to better themselves and find competitive advantages over their competitors.  Companies are demanding efficiency and experience out of their accounting departments – when these demands are going unmet – you need solutions.

If hiring a CPA firm to be your accounting team is something that you are considering, be sure to consult with a number of CPA Firms and choose the one that best fits your company and your vision.  Make sure that they have the right staff in place to handle your needs, make sure you are not going to be charged by the hour, and make sure you choose a firm that you feel comfortable with.  You want to be able to call your CPA at any time throughout the year with questions, so make sure you feel comfortable with your accountant.  This person is going to effectively become a member of your team, so finding a CPA that meshes well with your personality and can fit into your office culture is an important part of the process.

Remember – you are running your organization.  When you use an independent accounting firm, you are in a better position to do so.  Let your CPA handle your daily accounting functions and you can better focus on the core competencies of your business!

Ready to learn more about the Accounting Solutions team at LBA Haynes Strand? Contact us for your free consultation!

Bitcoin: What is it and How is it Reported for Tax Purposes?

Bitcoin has been all over the news recently. Although we hear a lot about it, we are left with numerous questions. What is it, how does it work, and how we deal with it from a tax reporting perspective? Now, other cryptocurrencies are hitting the mainstream. All of this makes us wonder, will these cryptocurrencies continue to shape our future or is all of this a fad that will die down within a year? Jamie Dimon, chairman and CEO of JPMorgan Chase stated in October that “If you’re stupid enough to buy bitcoin, you’ll pay the price one day.” More recently, on December 12th, he stated: “Look, everyone has a personal opinion about Bitcoin. I remain highly skeptical of it. But as I’ve said previously, I’m open-minded to uses of cryptocurrencies if properly controlled and regulated.”

What are Cryptocurrencies?

A cryptocurrency is a digital or virtual currency that uses cryptography for security and is not issued by any central authority. For this reason, it is difficult for governments to manipulate or provide any kind of control or oversight. Bitcoin is by far the most popular cryptocurrency, but there are many other cryptocurrencies that are beginning to gain traction. These include Ethereum, Ethereum Classic, Litecoin, Ripple, and Dash.

How about Bitcoin?

Bitcoin was the first cryptocurrency. It was released in 2009 as an open-source software. It, along with other cryptocurrencies, leverage the use of blockchain, which is a digital ledger in which transactions me in bitcoin or another cryptocurrency are recorded chronologically and publicly.

The market price of a bitcoin remained substantially low until 2013, where it shot up to over $1,000. Since then, market price fluctuated in the $200-$800 until this year, where it hit $10,000 as of a couple of weeks ago, and is trading at $16,000 as of the date of this article. The Winklevoss twins, who many may know from their famous lawsuit against Mark Zuckerburg, recently became the first “Bitcoin Billionaires.”

Tax Reporting for Bitcoin

The IRS has released some guidance for the tax implications of Bitcoin and other cryptocurrencies (virtual currencies) with the release of Notice 2014-21. Within this notice, they state that virtual currencies are treated as property for federal tax purposes. Fair market value must be determined in U.S. dollars and capital gains rules apply if the taxpayer sells or exchanges virtual currency.

However, there has been some debate about the applicability of like-kind exchanges. The IRS has remained silent about 1031 (like-kind) exchanges for virtual currencies. One idea is that Bitcoin for Bitcoin exchanges might qualify, but a Bitcoin for Ethereum trade might not qualify. However, this question might be irrelevant if a new tax bill passes that limits like-kind exchanges to real-estate property.

The payment of virtual currency can also constitute wages if paid to an employee. If an independent contractor receives more than $600 of virtual currency, Form 1099-MISC will be required.

How about Bitcoin Mining?

The use of computer resources to validate transactions and maintain the public Bitcoin transaction ledger (mining), is classified as income at the fair market value of the virtual currency as of the date of receipt. Mining constitutes a trade or business. This can constitute self-employment income if the activity is not undertaken by the taxpayer as an employee.

Stay tuned for updates on this subject and if you have any questions, set up your no-cost consultation or give us a call 704-841-1120.

Best Business Law Firms in Greensboro

We work with many attorneys and law firms throughout Greensboro and the state of North Carolina. Through referrals and working on joint projects, we have found 5 law firms that are especially great to work with.

The 5 best business law firms in Greensboro (in no particular order):
Carruthers & Roth

Carruthers & Roth was founded in 1937 and is located in the heart of Greensboro. They are a mid sized law firm offering big-firm capabilities delivered with the personal attention and responsiveness expected from a small town practice. Their clients include large multinational corporations, closely-held businesses, individuals, and entrepreneurs. To see a full list of their practice areas, click here!

Contact Info:

Phone: 336-379-8651 | Website: www.crlaw.com

Brooks Pierce

Brooks, Pierce, McLendon, Humphrey & Leonard, LLP is a business law firm providing comprehensive strategic counsel and innovative solutions. Their clients include: businesses, individuals, government, and non-profit institutions. The firm’s expertise extends to every aspect of business law (antitrust, mergers and acquisitions, start-up and publicly traded companies, trusts & estates, and many more).

Contact Info:

Phone: 336-373-8850 | Website: www.brookspierce.com

Womble Carlyle

Womble Carlyle is one of the largest and most technologically advanced business law firms in the Southeast. They have been serving the Greensboro region since 2001 after realizing Greensboro to be a key business center in North Carolina. The office includes 15 lawyers whose practices include: specialty areas of capital markets, corporate and securities, health care, intellectual property, and business litigation. The office is also home to several lawyers of the Firm’s Supply Chain Management practice group which provides supply chain solutions to businesses. While the firm was originally established in 1876 in Winston-Salem, it now comprises more than 550 lawyers in fourteen offices across the state of North Carolina.

Contact Info:

Phone: 336-574-8030 | Website: www.wcsr.com

Tuggle Duggins P.A.

Since 1974, Tuggle Duggins P.A. has been serving businesses and business owners with interests in the Carolinas. Tuggle Duggins is a multi-specialty, multi-disciplinary law firm focused on the needs of closely held businesses and business owners. They provide representation in legal matters ranging from conventional, personal, and business issues to complex legal matters. Their goal is to provide long-term client relationships and delivering exceptional services and results to their clients.

Contact Info:

Phone: 336-378-1431 | Website: www.tuggleduggins.com

Hagan Davis

Hagan, Davis, Mangum, Barrett & Langley, PLLC is a well established and trusted group of attorneys in Greensboro, NC. Dedicated to helping their clients achieve their business objectives effectively and efficiently. Hagan Davis has a proven track record for success, particularly in complex legal matters. There is no typical client of the firm, however most of their clients are influential in business, philanthropy, education, and sports. They deliver results to entrepreneurs and high-income individuals alike.

Contact Info:

Phone: 336-232-0650 | Website: www.hagandavis.com

If you need a business law firm in Greensboro, NC, these five law firms are the best place to begin your journey. Each firm comes highly recommended by the Principal Members at LBA Haynes Strand. If you would like a specific attorney’s information, please contact us.

Be Prepared: Fraud Is On The Rise During Tax Season

Did you know that ALREADY the IRS is warning that is has seen a 400% surge in phishing and malware compared to the last tax year?  Unfortunately tax season now coincides with “fraud season”.

Last week the IRS warned of the dramatic increase in official-looking text and email messages that taxpayers have received.  Phishing messages have been received asking for a wide variety of sensitive information, including filing status, personal information confirmations, PIN verifications, and more.  The messages have been created to look official as if they have been sent from the IRS or a tax software company and are being received in every corner of the United States.

Next time you open up that email that is asking for important personal information, take notice of who the sender is and the link that they are trying to make you click on.  Chances are that the link is hyperlinked to a fraudulent website, in hopes that you enter in your information there.  A trick is to “hover” your mouse above the link and then see where you are really being re-directed, if the link looks odd (which it probably will), then delete the email.  If you are unsure, you can always send the email to your CPA, and he or she can then advise on the validity of the email.

Remember: The IRS generally does not initiate contact with taxpayers by email, text, or social media, or phone calls for that matter. So if you receive a message, be suspicious!

Some subject lines that the IRS has seen in phishing scams, include:

  • Confirm your personal information
  • Get my IP PIN
  • Get my E-file PIN
  • Order a transcript
  • Complete you tax return information
  • Variations about people’s tax refunds
  • Update your filing details, which can include references to W-2

To report a phishing scam to the IRS, email phishing@irs.gov.

This blog was created for your protection, please be aware of these circumstances and alert your CPA if you are ever unsure.  We have experience in dealing with the IRS and can quickly let you know if something is or isn’t a fraudulent message.

Be Prepared for the September 15th Tax Deadline!

There is a misconception among that there is only one busy season when it comes to tax and accounting firms in the United States. However, there are many deadlines to be met throughout the year, making for multiple busy seasons. With the September 15th tax deadline fast approaching, we want to alert our clients of what is due.

What is due by September 15th?
  • 3rd Quarter estimated tax payments for the 2015 tax year
  • Final deadline to file corporate tax returns for the year 2014 if an extension was requested. (Forms 1120, 1120A, 1120S)
  • Final deadline to file trust income tax returns for the year 2014 if an extension was requested. (Form 1041)
  • Final deadline to file partnership tax returns for the year 2014 if an extension was requested. (Form 1065)
What are the penalties if the September 15th Deadline is ignored?
  • C Corporations – The IRS can assess a penalty of 5% of the next tax due for each month or part of a month the return is filed late, up to a maximum penalty of 25%.
  • S Corporations – The IRS can assess a penalty equal to $195 per shareholder for each month the return is filed late (maximum of 12 months). Therefore, the maximum penalty per shareholder is $2,340.
  • Partnerships, including multi-member LLCs – The IRS has the ability to assess a penalty equal to $195 per partner/LLC member for each month the return is filed late (maximum of 12 months).

If you are unsure if you are adequately prepared to meet these deadlines, contact us for a no cost consultation. We are able to provide on the spot tax preparation advice and will begin your tax planning for next year, so that deadlines no longer sneak up on you.

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?