Weird Dog Habits

Your Accountant's Weird Habits - Explained

If you have a pet in your family, maybe you've seen those articles purporting to explain why your dog spins in a circle before lying down, or why your cat would rather drink from the faucet than a water dish. To many people, there is a creature even more alien and perplexing than any animal: the finance professional.

Your bookkeeper or tax professional might say or do things that don't make a lot of sense to you. Some of their actions might seem flat-out contradictory. But, as with any exotic species, there is a reason behind all of it.

I want to break down a few of the most commonly complained-about behaviors, along with the explanations behind them (with the assistance of cat pictures).

 

First annoying habit: My accountant keeps nagging me to get organized.

Your bookkeeper wants you to have a system for tracking open customer balances, or wants you to keep all your expense reports in one place. It's frustrating, because the whole reason you're paying them is for them to "keep up with that stuff".

So why do they do it?

For starters, good bookkeeping relies on complete information. (A balance sheet showing $1M in the bank doesn't mean much if there's a $995K liability that got left off.) Unless you have an in-house accounting staff, your bookkeeper is relying on you to get that information to them. A good organizational system ensures that all of the information is getting to who needs it.

Furthermore, most accountants charge based on time expended, and though good accounting can be had at a good value, it's still not cheap. Paying your accounting service to dig through files and hunt down info is a waste of their time and your money.

Accountant Cat 1
Accountant Cat is tired of looking for your payroll reports.

 

Speaking of "time", my accountant freaks out if I don't get certain information to them right away. What's the rush?

Certain items, particularly related to tax filings, can incur massive penalties if late. Your accountant needs the information in advance of those deadlines, to record it and check for accuracy. (Inaccurate filings can also, of course,  result in penalties.)

If your accountant is pestering you to get information to them quickly, it's because they are trying to keep you out of trouble and save you money.

Accountant Cat 2
Accountant Cat on April 10th, waiting on you for info.

 

Since we're already talking about taxes...Why does my accountant try to make me spend money I don't want to spend? For instance, why do I have to treat certain workers as W-2 employees, instead of paying them as contractors?

Because worker classification is a big deal. Not paying employees correctly can result in audits, fines, and even lawsuits. Your accountant is being a stickler about the rules because they don't want you to get sued.

Accountant Cat 3
Accountant Cat, finding out you're paying your 9-5 office assistant as a 1099 contractor.

 

Still talking taxes...Why does my accountant say I can't take this cool deduction I found? I saw online that I can expense my home office/car payment/pet kinkajou/etc.

Present blog excluded, internet advice is no substitute for real, professional guidance. Though you'll seeing many articles claiming that you can write off an entire car payment, or take a "home office" deduction, the actual guidelines surrounding those items have specific criteria which must be met. Unfortunately, small businesses, particularly those which are sole proprietorships, are frequent targets for audits. Taking excessive, unqualified deductions puts you at an even greater risk. If you trust your tax professional, trust that they will advise you of deductions for which you do qualify. (If you are not happy with your current tax professional, we can recommend some.)

Accountant Cat 4
Accountant Cat has some bad news about that great deduction you found...

 

So I have to spend extra on employees, but can't take any of the fun deductions. And now I'm being told that I need to watch my spending on meals, and look at ROI for things like advertising. Is my bookkeeper just a kill-joy?

No, they just don't want you to go broke. Going bankrupt isn't just bad for you; it also means you can't pay your vendors (like your bookkeeper). So they have a vested interest in keeping you solvent.

Because, no matter what your business, one thing we all have in common is that we like to get paid.

Accountant Cat 5
Accountant Cat could lighten up if you'd stick to a budget.

Maintaining Work/Life Balance (When You Work From Home)

With the increase of mobile technology and the high cost of office rentals, it is increasingly common for small business owners to work from home.  And since they’re their own bosses, those entrepreneurs can get left out of the discussion of how to achieve work-life balance.  After all, how do you “get away from work” when work is where you live?  In this article, we’ll discuss some steps that can be taken to maintain work-life balance when working from home.

1.  Have a separate space.

If possible, keep one room in your home dedicated exclusively to work.  Don’t do work anywhere else in the house, and don’t do leisure in that room.  It’s too easy to take a break from playing a game or watching a show to “answer a few work emails real quick”.  (Likewise, it’s too easy to check on Facebook mid-conference call.)  If you make a space just for working, it helps you to fully commit to what you are supposed to be doing at the time, whether that is working or relaxing.

On top of the mental and emotional benefits of having a dedicated workspace, there is a financial benefit.  A home office deduction can be a huge boon at tax time and, per the IRS, is defined as, “Exclusive and regular use as the main place in which you conduct your business...”

Of course, not everyone will have the option of having an entirely separate room for a home office.  If that’s the case for you, try to find a way to differentiate your “workspace” from your “living space”.  Make sure that, when you’re working, your area is free of distractions.  If you normally listen to Top 40, turn the radio to classical.  You can even have a picture or two you set up on your desk, as though you were working at an office away from home.  Just find a way, personal to you, to clarify in your mind that you’re currently “at work”.

2.  Have set work hours…

Now, this isn’t to say that you’re required to work a standard 9-5.  Many of us go into business for ourselves for the freedom and flexibility that comes along with being your own boss.  However, not having a particular time set specifically aside for work tasks can also make it easy to procrastinate.  Find a regular time, maybe daily or once a week, when you look at your schedule and map out exactly when you’re going to work on specific work tasks.  And stick to it.

3.  …And set leisure hours.

Again, this doesn’t mean you ignore a work emergency because you refuse to do business after 6.  However, it is imperative that you find times when you focus your energies on something besides work (even if it’s just to focus on a tv show you really enjoy).  Living and breathing work 24/7 is a good way to burn yourself out, and to forget what you enjoyed about your business in the first place.

4.  Have someone keeping you accountable.

Everything in life is easier with a partner.  Even if you are the sole employee of your company, you should have a friend or mentor who can give you the kick in the butt you need when you’re lacking motivation.  (Of course, the various benefits of having a mentor are a different article for a different day.)  Likewise, in your personal life, you need a friend who can make plans with you to have fun and relax, and who won’t let you off the hook if you try to bail for work reasons.  Find a friend who will hold you to dinner plans, and who will confiscate your cellphone if necessary.  (No work calls or emails at the table!)

Most of all, remember that, when you own your own business, you are in charge.  It’s doubtful that anyone starts a business with the dream of working 60+ hours a week and never having a night out again.  Remember what you’re working for, and go easy on yourself every once in a while.  Work to live; don’t live to work.