There’s this amazing client of ours with 5 businesses.

They came to us needing help, guidance, training, the right skills to foster a new tone within the accounting team and cleanup their accounting data and systems. They had been through multiple CPA Firms making promises and never following through, while charging them hundreds of thousands of dollars in the process.

Bookkeeping is a cash grab for CPA firms. Why? Because many of them outsource the bookkeeping at a low cost (India, Philippines, etc.), but the markup on your bill is insane. They minimize the bookkeeping and focus on tax, which is wildly backwards.

Here are the issues we had to find solutions for:

• Untrained, unguided, and undisciplined accounting staff.
• Accounting staff that were “stuck in their ways” and opposed positive change.
• Accounting staff that were getting “reimbursements” with no oversight.
• Accounting staff that were revealing sensitive information about the business, in front of other employees.
• Management that were at the mercy of their employees due to an inability to find “local talent” in accounting and finance.
• A month-end close that never happened (the CPA firm was behind 6 months and caused them to be late on their tax deadlines).
• Messy assets (no tracking, no analysis, no thresholds, etc)
• Blanket Journal entries with no information (a common tactic of CPAs that want to force the numbers and avoid doing the actual work).
• Angry vendors as a result of an inconsistent and unprofessional AP process.
• Backed up billing and AP emails.
• Fast-growing and changing business, with no accounting infrastructure to support it.
• Hundreds of thousands of dollars in monthly credit card spending, with no oversight.
• Messy inventory systems with faulty and inaccurate connections to the accounting system.
• 600+ accounting the chart of accounts, with a terrible and confusing structure. (This is a tactic some firms use, to make sure no one knows how to take over the books.)
• No one designated to track or submit 1099 information.
• A huge line of credit split between 3 companies, utilizing sweep accounts, that had never been reconciled.
• Lenders asking for quarterly reports and getting nothing, while becoming increasingly frustrated and threatening to pull lending.
• And more that I am surely forgetting…

Wisdom tells us that to go somewhere you’ve never been, you must do something you’ve never done. This is the most accurate statement that can be made in business. Sometimes, in order to grow you need to let the old processes and habits die, and move into a new timeline. Sometimes employee turnover is necessary, but that doesn’t mean the business goes down with them.

In taking over messy books that had been backed up for months, we dove in deep to look into every process and every adjustment, so we could nail down the cause and accuracy of the accounting work already done. Once we figure out the accounting and processes along with their complexities and errors, we strategized on the current and future needs of the business.

Once we understood what was needed, we restructured and simplified the entire chart of accounts and got to work on the full year of cleanup.

• We nailed down all of the intercompany balance sheet accounts and consolidated, adjusted, and corrected, to get to the validated numbers.
• We validated and corrected every balance sheet account, along with erroneous and nonsensical accounting adjustments.
• We corrected errors made months and years prior in all accounts.
• We worked with the in-house accounting team to train them on accounting concepts, accurate coding, Vendor, AP and AR management, cash flow management, created processes to catchup on emails and taught how to speak to vendors in a way that satisfied their anxiety and controlled outgoing cash, and so much more.
• We worked with management to advise on accounting personnel issues. New hires, turnover, hierarchical guidance, expectations, and assignments.
• We identified areas where revenue wasn’t being captured, then created a process to capture this information seamlessly.
• We cleaned up the inventory and asset accounts, set a process for moving forward, and consistently tracked and analyzed the accounts and movements.
• We found hundreds of dollars worth of assets that were not accounted for, established a minimum asset threshold, and analyzed 20 years of asset entries to provide a complete asset list.
• We found dozens of long-term leases that were not being accounted for properly, and were dragging down the company’s profitability on the P&L. We tracked down all of the original agreements and associated assets and made several corrections and amortization schedules.
• We corrected loans that were also not being accounted for or reconciled properly.
• After the cleanup, we worked on customizing the reporting process and consolidation, so that the lenders were satisfied and company credit was no longer at risk.
• We confirmed the full year of cleanup was complete and handed over the books to a specialized CPA firm for an official review of the books, and had no red flags at all. All questions were satisfactorily addressed in a timely manner and with professionalism.
• We got them on a consistent monthly close schedule, and now have the month closed for all 5 companies within 10 to 14 days each month.
• Now we are working on improving operational processes and collaborating for additional growth in sales.

We don’t do accounting just for taxes, we do it to support operational and management decision making and needs.

We do it to avoid-accounting emergencies and risks.

We do it because we learned how to manage cash flow and support vendors, in a time of economic crisis so the business wouldn’t go under as a result of covid shutdowns.

We do it because we know what happens if you are not setup for the worst case scenario. If you stay ready, you never have to get ready.

Here is a little quote from our client:

I can get choked up on words with all you have taught, led, fixed, created, negotiated, mediated, on our behalf. Kay is An absolute star! An advocate for best practice! Passionate about her industry! A respected voice in the C-suite. We are the better and healthier because of Kay and her firm. 

My motto is this. Be proactive & not reactive.

Let’s get you ready.

Book a new client consult here if you’re ready.   

Kay Diouf

Senior Accounting Consultant, Owner