Master Your Finances Kurt Baker with Ms. Adrienne Dove – Transcript

Written by on March 3, 2023

0:00:00.0 ANNOUNCER: So you wanna know the ins and outs of managing your money, well, lucky for you, you are just in time for another episode of Master Your Finances, with certified financial planner professional, Kurt Baker. Kurt and his panel of experts are here for you, and will cover topics from a legal and personal standpoint, they’ll discuss tax efficiency, liability, owning, managing and saving your money, and more. Master Your Finances is underwritten in part by Certified Wealth Management and Investment and Rider University. Rider offers continuing studies programs for adults who need flexibility, want to add new skills to your resume? Take a Continuing Studies course at Rider university. Now, let’s learn how we can better change our habits with Kurt Baker.
0:00:47.3 Kurt Baker: Are you certain that your company’s bookkeeping is in good hands, are you just starting out and wanna learn bookkeeping techniques to help you manage your books and prepare for tax season? Adrienne Dove, the founder of Corban bookkeeping solutions and a QuickBooks consultant is here to help you prepare your books for tax season to make you feel at ease and confident that your company’s finances are in order. Now, this is awesome, I have to tell you, as a business owner, this is probably, if not at the bottom of list, really far down the list of things that I’d like to do on a day to day basis is manage the books. It’s a necessary thing, you’d like to have the results, but not necessarily the actual time that it takes to enter everything and make sure it’s all nice and organized but, thank goodness that you’re here because you are like every business person’s dream to get that stuff done so they can focus on their business. So tell us a little bit about your background and how you got into this really cool industry.
0:01:46.3 Adrienne Dove: Sure, thank you for having me. So I actually studied accounting in college, I went to Drexel University in Philadelphia, and like a lot of accountants go down the public accounting route, I decided to do private industry, so right after college, I started working in the pharmaceutical industry. My first company was Johnson and Johnson, worked there for a few years, then I went to Bristol Myers Squibb, and then the last company that I was at was Novartis, these are all pharma companies, I started in just general accounting, but it eventually it morphed into financial planning analysis, almost being like a mini-controller for franchise managing their financial statements. I did a lot of other financial analytical type jobs that only exist in a pharmaceutical industry related to pharmaceutical contracts, which we talked about four years ago.
0:02:43.0 Kurt Baker: The last time you were on here, it was very fascinating by the way but so… Yeah, that was cool, so the accounting in the pharma world is very different than the accounting in some other…
0:02:52.0 Adrienne Dove: It’s different than public for sure.
0:02:53.1 Kurt Baker: That’s for sure. [laughter]
0:02:54.8 Adrienne Dove: And so while I was working, I have a lot of friends who are entrepreneurs, it just so happens, and there was a couple who they harvest their own honey, they have bees, and they make their own raw honey, and they asked me to help them with their books, and that’s how it started, that’s how I found this world of small business bookkeeping. Which is completely different from the corporate environment that I came from.
0:03:17.1 Kurt Baker: So it’s been a sweet business from the very beginning.
0:03:19.1 Adrienne Dove: From the very begin. Very sweet.
0:03:22.9 Kurt Baker: Awesome.
0:03:23.6 Adrienne Dove: Yes. And I ended up loving it, and I was transitioned out of my former job in 2018. In February of 2018, and then April of 2018 is when I started my LLC.
0:03:34.9 Kurt Baker: Okay, so you just got right into it.
0:03:38.9 Adrienne Dove: I just jumped right in.
0:03:39.0 Kurt Baker: A huge amount of experience.
0:03:39.1 Adrienne Dove: I already had one client and…
0:03:41.4 Kurt Baker: Oh wow, yeah, you had your honey’s business going.
0:03:43.4 Adrienne Dove: And it’s been a journey from there, I’ll be celebrating five years in April.
0:03:47.3 Kurt Baker: Well, congratulations. That is really awesome. So I think it’s kind of interesting, you got a background where you’ve been handling very, very complex things out there.
0:03:53.4 Adrienne Dove: Yes.
0:03:54.0 Kurt Baker: So from your perspective, I’d assume working with your regular entrepreneur, medium-sized businesses and things like that, it’s probably a little bit simpler than maybe the pharma world, as far as all the complexities, but it still has to get done correctly, so it’s kind of great.
0:04:10.9 Adrienne Dove: It has to be done correctly. And I think that when you’re an entrepreneur, you’re basically… When you first start out, you’re responsible for everything, so if you think about a large corporation, you have a finance department, you have marketing, you have sales, you have operations, and when you’re first starting out… At least for me, I was all of those things, and so in addition to doing all of those things, you still have to work in your business, you still have to manage the books for your clients, and in five number… This year, number five, I guess it’s a pivotal year because I’m at a point now where I need some outside contracted help because my business has grown, so it’s another part of the road of the journey of being an entrepreneur.
0:05:00.7 Kurt Baker: So when you’re an entrepreneur, you are getting started off, obviously, every little thing you do, you’re trying to be as cost-effective as you can and I think one of the first things you learn as an entrepreneur is how to, as quickly as you can outsource as many items as you can, whether you hire an employee or whether you bring in a contractor, you as an individual entrepreneur, need to offload as much as you possibly can, other than your core mission of whatever you’re trying to do, and all these ancillary issues like bookkeeping and things like that, you need to get those off your plate because they’re just taking up your time and they’re not adding to your productivity. So what types of things you recommend to an entrepreneur? When do they kinda bring somebody in to help them get all this emotions so they can say, “Hey, I can actually focus on honey, right, making sure my bees are doing their thing out there” or whatever it might be that you’re doing.
0:05:46.3 Adrienne Dove: It would be great if at the very beginning, if they could budget for an outsource bookkeeping firm or accounting firm, but some businesses when they first start out, they have issues with cash flow, so I do have some clients who start out right from the gate, they want my help, and then I have other clients who tell me that they’ve been doing their own books by themselves, and it just naturally gets to a point where they can’t run their business and do that financial piece as well, so I would say if you can budget for it right up in the beginning, you may not be able to pay a premium price for all services, but at least you should be able to get someone that can help get your software set up, which I’m a QuickBooks consultant. There’s other softwares out there, but I really love QuickBooks because I think it’s a great software for accounting and they are a company, and two what they specialize in accounting software and tax software. So they’re experts at what they do.
0:06:52.5 Adrienne Dove: So you can get someone to set that up for you, and even if you’re just starting out and you can only afford to have your books done on a quarterly basis, then start from there, and then as your business grows, as it naturally grows, you’re gonna find that you need more financial support, because there’s the bookkeeping, but then there’s the consulting side where you’re kinda… I help clients decide if there’s a certain app application that’s gonna help them make their operations more efficient, I talk to them about apps that may work really well with QuickBooks, depending what kind of industry they are in, I help them with strategic plans, with budgets, and so as their business grows, I can customize the services that they may need as they grow.
0:07:37.9 Kurt Baker: And I think that’s part of the key is I think one of the things that we try to do as a young entrepreneur, you’re really trying to figure out how do you become more efficient? And I think if you implement the right software in place, then it just takes things completely off your table because now the software is handling it for you, and it’s a lot easier to manage your business if you kinda know where you stand on an ongoing basis, if you wait the whole year before you really understand what’s going on, you could have a positive, like a surprise, or you may have a very negative surprise, and those are not…
0:08:05.1 Adrienne Dove: Exactly.
0:08:05.5 Kurt Baker: Those are not as good, ’cause you don’t really know what your nets are unless you’re kind of tracking along the way.
0:08:11.0 Adrienne Dove: You need to track it, and I do tell some business… These are some businesses that I just onboarded recently. They had a process in place where they would send their accountant or their CPA all of their bank statements or an Excel spreadsheet at the end of the year, and then that person would take those statements and they would do a profit and loss statement and a balance sheet for them and get their taxes done, but I tell those clients that as a business owner, these are your books, they are your financials, you own them, we the accounting professionals, we me may own the process that help get all of that in financial information together so that you can see how you’re performing, but as the owner, you should really want to have control over that.
0:08:57.3 Kurt Baker: Right.
0:08:58.6 Adrienne Dove: And so I tell those clients, that it’s not a best practice to wait until the end of the year. And so some ideal clients for me, that are… There are people that come to me and they’re in that situation where they haven’t done anything all year. And then I will get their books caught up, I’ll do a diagnostic review of their books to see if there’s any issues, I’ll fix any errors in the books, I’ll get the books caught up-to-date, and then I show them, This is how you performed for the year, but it’s like… But at any given point in time, at the end of the month, you should be able to see how you’re performing, you should be able to see your sales and your expenses, you should be able to see who you owe and who owes you, that’s part of your responsibility as a business owner. And so if I can convince them that they really own these numbers, it’s our job to help them understand and to partner with them to make sure that they understand how their business is performing, but the idea that the books belong to us, the accounts, I think is something that I try to educate clients on.
0:10:04.5 Kurt Baker: Right, ’cause it’s something they don’t really think about other than, Hey, do I have enough money to pay my bills and take care of what I have to take care of, beyond that, they’re really are not paying a whole lot of attention to that. So the idea is you wanna really get in front it ’cause then you can see on a monthly basis, Hey, here’s how we’re doing, and then you can set your goals objectives, ’cause every big company, they always have like, We gotta finish out the month, good, we gotta do the…
0:10:26.5 Adrienne Dove: Exactly.
0:10:27.2 Kurt Baker: Alright, so at least you’ve got these deadlines throughout the year, they help you stay on track, ’cause you gotta break, every kind of goal and objective, you have to break it in to little pieces, right?
0:10:35.7 Adrienne Dove: You have to, yes.
0:10:37.2 Kurt Baker: And if you break it into little pieces, it’s much more manageable, whether that’s day, week, month, hour, whatever the case may be, everything has different timelines, but I think you point out something very valuable, which is any company anybody’s ever worked for, they always have this in end of the month, Hey do we get enough sales? Hey, do we do this? Hey, do we do that? Well, that’s the reason they do it they wanna close out the month to be able to see exactly where they are, so now they know, Okay, here’s the adjustments we need to make for the next month.
0:11:00.6 Adrienne Dove: Exactly.
0:11:01.7 Kurt Baker: And it just simplifies it. And that’s a nice target when you have basically a 30-day target, it’s something that’s kind of manageable ramp it up, get close it out. Just kind of naturally works pretty well for most businesses. Right.
0:11:11.8 Adrienne Dove: It does, and I also think, with what it does is it helps businesses do a budget for the full year, especially if they’ve gone through a year with me where every month they’ve been able to see how they’re performing, the next year, we can do a budget where we forecast out sales and we forecast out all of your expenses for the entire year, and so then you’re at a point where you’re not only seeing how you’re performing on an actual basis, you can look at how you’re performing versus what you forecasted, and then we can make tweaks as needed. To me it’s a good place to be when you’re a business owner, you don’t have to be a financial person, but it’s nice to be able to know how you’re performing at any given point in time.
0:11:57.0 Kurt Baker: That is very true. We’re gonna take a quick break. You’re listening to Master Your Finance, we’ll be you right back.
0:12:01.0 ANNOUNCER: This is Master Your Finances with Kurt Baker, a certified financial planner professional, learn about tax efficiency, liability, owning, managing and saving your money. And more from Kurt and his experienced panel of guests. Master Your Finances is underwritten in part by Certified Wealth Management and Investment and Rider University. Rider university offers flexible education for adult learners for more information it’s
0:12:35.6 Kurt Baker: Welcome back, you are listening to Master your Finance, I’m here with Adrienne Dove and we’re talking about finances and bookkeeping, which is extremely important… It’s kinda like that foundation piece that we all have to have, but we don’t necessarily think a whole lot about it, we would rather build the structure on top of it, but you really have to have a good foundation, and the basic accounting and keeping track of your book is really, really important, and one of the first things that small businesses need to try to do is figure out a way to manage that and outsource it somehow, whether you hire somebody to help you or whether you have a service to do it for you. And as Adrienne pointed out, it can be very basic things like just reconciling things on a monthly basis to make sure you understand where your cash flow is and things like that. So for all these busy entrepreneurs out there like, Hey, I don’t really have time for all this stuff, I’m gonna throw in a shoe box, whatever, maybe an electronic shoebox now, but I’m gonna put a shoe box and I’ll just figure it all out in January when the year is done.
0:13:31.9 Kurt Baker: Do you have any tips that may be things that a business owner should be doing throughout the year that you see that they miss quite often and you are like, Oh gosh, if I’d just talk to a couple of months ago and you just did the simple tasks, maybe we could have made things a little easier for you.
0:13:44.7 Adrienne Dove: Sure, well, the shoebox is a good place to start, but we don’t wanna stay there because we live in a virtual world now, but the receipts are really important, and they can definitely check this with their CPA, but I think you need to really keep receipt, take copies of receipts or keep receipts that are $75 or over, other really important things that they could do is make sure that they keep business and personal expenses separate. It’s really, really important to have a separate business bank account, a separate business credit card that you use only for business, and there’s some audit issues related to why that needs to take place is like… But that would be a really good conversation for a client to have with the person that does their taxes, like the CPA or the tax professional.
0:14:37.3 Adrienne Dove: I focus more on the transactional side because I think that that is the foundation of the business, and a lot of the granular level transactional work is where you find a lot of the problems and a lot of the issues, and I like to be a problem solver for my… For small business owners and clients, so I really focus on that, so they should keep personal and business separate. Other things that they could do is track their mileage, there’s a lot of different apps out there, there’s Mile, IQ, Trip log, if they do happen to have QuickBooks online, QuickBooks Online has its own mileage tracking device, because you get to deduct that on your taxes, I think for 2022 is 62.5 cents per mile…
0:15:25.6 Kurt Baker: It’s up there now, right?
0:15:27.5 Adrienne Dove: It’s up, and then it’s going up to 65.5 cents this year in 2023, they should really pay special attention to the tax deadlines, not everyone doesn’t… I know this may seem like people should know it, but people should know not everybody has a tax deadline in April. So S corps and partnerships, their taxes are due a month earlier.
0:15:51.0 Kurt Baker: I know, I really bumped that up a few years ago.
0:15:54.8 Adrienne Dove: March 15th.
0:15:54.9 Kurt Baker: Like, Oh wait a minute. [laughter] What happened here?
0:15:58.7 Adrienne Dove: Yeah, so they should keep that in mind. And then they need a trusted financial partner to help them manage their books, and I think that’s where I come in, and again, my role is more on the transactional, granular level side is where I work, but I also have some great strategic partnerships with some CPAs who actually, after I’m done cleaning up the books and then they do the taxes.
0:16:24.3 Kurt Baker: Well, that’s awesome. So something that you mentioned that you tend to find things in the granular aspect, so what are some of the things that you can discuss with us in a generic term, that and we don’t get specific obviously, but… So what are some types of things you go through the book, you’re like, Oh, here are some things that we found, can you give us some examples of types of things that you typically will locate, maybe the business wasn’t really aware of or shouldn’t… Didn’t really understand. It might have been an issue?
0:16:50.0 Adrienne Dove: Well, I can give you some examples of… And this I think that this is a person who really meant to do well, they knew that they needed to have some kind of accounting software set up, and so they went and purchased their QuickBooks online subscription, and they started to set up… One of the first things you do when you purchase your subscription is you set up something called the chart of accounts, and the chart of accounts is basically all of the accounts where your transactions are going to be categorized and depending on the account, it’s either on the profit and loss statement, which is income and expenses, or it’s on the balance sheet, which is assets, liabilities and owner’s equity. And this particular person, they set up their chart of accounts and they thought they had done a really good job, and then when they went to get their taxes done, their CPA told them that they basically had no profit and loss statement, because every single account that they set up, they set up as a bank account, which is an asset, so like Amazon, when you go purchase office supplies, office supplies is an expense, they had to set up as a bank account.
0:18:00.5 Adrienne Dove: So those are… That’s the foundation, setting up the accounts in the right way. I had some clients who have personal expenses mixed in with their… Mixed in with their business expenses and again, depending on what kind of entity you are, if it’s a single member LLC like myself who does taxes as a sole proprietor, you really should not be using your business bank account or credit card for personal expenses, but when you do, those are considered owners draws. So those are personal expenses that really need to be kept separate, they go on the balance sheet, they’re not on the profit and loss statement.
0:18:42.7 Adrienne Dove: Other things that we look for is if there is incorrect balances in accounts receivable, that means those are customers who owe you money, you really should not have credit balances as an accounts receivable but I don’t… I mean, this is going into accounting, but those are people who owe you money, and also sometimes there’s issues in accounts payable, those are vendors that you owe money to.
0:19:04.6 Kurt Baker: Right, right, right.
0:19:06.2 Adrienne Dove: So a lot of times when I’m diagnosing, I call it a diagnostic review, which is one of the first things I do when someone comes to me and tells me that they haven’t done their books in 12 months or for 24 months, the first thing I do is I look on the balance sheet and I look at bank accounts, I look at accounts payable and accounts receivable, and then the fun begins.
0:19:30.2 Kurt Baker: Yeah, you just went through a lot of stuff. And so, yeah, some of this is interesting. I’ll get into one that just I know our non-profit deals with this. This is one of the things we’ve got somebody helping us do this, a volunteer. It’s like nice. The accounts receivable, I think is key, at least, as far as I’m concerned. It’s like, “Okay, make sure you’re invoicing properly and make sure you’re tracking as the money comes in, because any business and non-profit, same way. Every dollar, you gotta track it, make sure it’s coming in. And as we got better at this, we had systems in place, I know that we’re getting paid a lot faster because you’re getting the reporting and it’s being constantly reviewed every week, and you’re reconciling this thing on an ongoing basis, and you can write your reports out and you say, “Oh well, here’s exactly what’s owed to us.” You’re like, “Oh, wow, I didn’t realize that someone still owes this money from blah, blah, blah,” and you’re like… Sometimes you just don’t… You can’t remember everything, right? [chuckle] For sure.
0:20:26.4 Adrienne Dove: Accounts receivable teachable can really get away from you when you’re not on top of it, because technically you really should get paid within 30 days, so 30 days from the day that you send out an invoice. If you can get paid quicker, that’s great. The problem is when you’re not on top of accounts receivable, and that’s some of the things that I find when I clean up books and I find that people have outstanding invoices that haven’t been paid in two or three years. Well, those… There’s something called a write-off. Those invoices should have been written off as bad debts.
0:20:57.4 Kurt Baker: Yeah, what’s it? 120 or something I think they say? 120 days.
0:21:00.3 Adrienne Dove: Yeah, I think it’s 120, 160, something like that.
0:21:02.1 Kurt Baker: Yeah. Yeah, that’s what I heard.
0:21:03.8 Adrienne Dove: Yeah, so this is… We’re doing the books now, where people are doing their taxes for 2022, and you have old invoices on there from 2016 that is there. [laughter] They should have been written off.
0:21:17.4 Kurt Baker: Okay. I have to ask you a question. Have you ever, in the history of reviewing books, ever found anybody that had an outstanding invoice that exceeded the cost of keeping their books? Having somebody actually manage their invoice. In other words, if they were to hire somebody to manage their invoices and their accounts receivable, would that number potentially be less than the value of the invoices that were still outstanding that could have paid for the service to keep the invoices paid on time?
0:21:42.2 Adrienne Dove: No, no.
0:21:43.4 Kurt Baker: What?
0:21:44.6 Adrienne Dove: Yeah, repeat that again.
0:21:47.7 Kurt Baker: Yeah, maybe I’m just not saying well. What I’m saying is that, let’s say I’ve got an outstanding invoice of $10, and the cost for me to hire somebody to manage my invoicing and my accounts receivable, say that was $8. Now, that’s a $2 profit from something that didn’t exist prior because I was missing it. So I guess what my question is, have you ever seen, when you go back into your diagnostics, where you find outstanding invoices that exceed the cost of… They just hired somebody to manage their books, so that never would have gotten out of hand and they would have been able to track it and maybe get paid early?
0:22:22.1 Adrienne Dove: I think that the value is in me finding it.
0:22:25.9 Kurt Baker: Right. That’s what I mean. They’re gonna pay for it. What I’m trying to say is that most likely the service, if you have any issue whatsoever, even if it’s a little bit, ’cause as you plan out, this gets way out of hand very fast, is you think, “Oh well, they’re gonna send something.” Before you know what, it’s like 60-90 days and you’re thinking it’s a couple of weeks. And what I’m saying is that if somebody… And we found this out of the non-profit. That’s why I’m kind of on this, because it’s like, Okay, as soon as we started doing this, things were getting paid pretty much on time, ’cause in our case, they’re government entities, there’s things that have to have processes, so even when you invoice and there’s the PO, you have to sign, you have to send it back, then they have to go ahead and send it to you.
0:23:04.7 Kurt Baker: So there’s a couple of weeks involved in this whole process of back and forth, so the sooner you get the invoicing information and the sooner you start to track it, and then if one gets missed, you’re following it right away to go, “Oh yeah, that’s correct.” And you wanna get it before the budget year closes out ’cause then it creates this whole other issue for them because, “Oh, we had that money allocated for you, and now it’s the end of the year.” And then we get it, but it’s just… I know it creates extra issues from an accounting standpoint. You can kind of sense it on the other, like, “I wish you just told us like a month before. We would have been able to do it very easily.”
0:23:35.7 Adrienne Dove: And if you’re a business that it’s more than $10,000, it’s more than $10, it’s thousands and thousands of dollars, and it’s multiple customers that owe you money, it’s very, very easy to get lost in that. So one of the things you do on a monthly basis is you look at your aging report for accounts receivable and you can see, “This person hasn’t paid me in 30 days, and there probably needs to be some kind of communication to… ” And then for certain businesses, smaller businesses, I tell them that they should try to cut down on accounts receivable altogether, and if you have a service-based business, try to set something up in your business where there’s a payment upfront, so there’s… You have their ACH, bank account information or credit card on file, because if you’re a service-based business, maybe accounts receivable, maybe that’s low-hanging fruit that you can get rid of. For product-based businesses, it might be a little bit different, but it’s very easy. Like when you purchase something from Amazon, they don’t send you a bill later.
0:24:41.5 Kurt Baker: Oh no, they’re very efficient.
0:24:42.3 Adrienne Dove: You have to pay for it upfront, just like you pay for your Verizon internet. That’s all… They have your payment information on file, and we should be the same way us service-based businesses, where we are providing a service. Yeah, we need to get paid upfront.
0:25:00.0 Kurt Baker: Absolutely. Great tips. You’re listening to Master Your Finances. We’re gonna take another quick break.
0:25:03.7 ANNOUNCER: This is Master Your Finances with Kurt Baker, certified financial planner professional. Learn about tax efficiency, liability, owning, managing and saving your money and more from Kurt and his experienced panel of guests. Master Your Finances is underwritten in part by Certified Wealth Management and Investment and Rider University. Rider University offers flexible education for adult learners. For more information, it’s
0:25:36.8 Kurt Baker: Welcome back. You’re listening to Master Your Finances here with Adrienne Dove, and we’re talking about finances. And something I learned is, when we started a non-profit a number years ago, then we started actually getting real cash flow from it, like lots of different invoices and so forth, which is, Thank God is good. Then it became an issue managing it, and then we got a volunteer help us really stay on top of that a little bit better, and I know it works out better for us, and it actually works out better for our vendors ’cause they tend to be government agencies of some kind, and the better you’re tracking this and you have the procedures in place and then you get, as you pointed out, the aging report, then you can really see what’s still owed to you and what you still need to go collect and you just have to go get it sometimes, and so we learned a lot from that.
0:26:20.7 Kurt Baker: And I think you pointed out something very interesting. I remember… This is going back a few years. I just remember when you started going and somebody come out, like the plumber would come out, and they would actually have you pay right there standing in your kitchen. And I thought that was pretty smart because now there’s no sending you the bill and you gotta mail it in and all this other good stuff, so to me, that’s a win-win all the way around, because as you point out, you completely eliminate the aging report issues when the tech actually walks out and can give you the ability to pay right there, and there’s no accounting department that has to contact you later and send you the bill and they wait, who knows how long, before that. That must have been a whole different life for them. And I think most businesses, when they can… And I can’t really think you can have a scenario where you really can’t just have them pay upfront for most situations.
0:27:09.3 Adrienne Dove: I think for a lot of service-based businesses, it works really well. I can use my business as an example. It’s one of the first efficiencies that I implemented in my virtual bookkeeping firm, was I got rid of accounts receivable. So I have a practice management system that… In the practice management system, it has a proposal or a contract, and then the contract, my clients, they actually put in their payment information. They know exactly… It’s a fixed pricing that I give my clients, so they know exactly every month what they’re gonna be paying. There’s no need for me to send them an invoice every month. And so there is no accounts receivable. On sometime between the first and the fifth day of the month, all of my clients that I have fixed pricing packages with, it’s just an automatic payment that comes through.
0:28:03.4 Kurt Baker: Right. So that’s awesome. It significantly reduces the issues, right? So unless there’s some issue with the payment method itself, which is relatively rare, maybe a credit card needs to be renewed or something.
0:28:12.5 Adrienne Dove: Yeah. So you have to stay on top of that because… But the system that I use, I’ll get a message that says, “This credit card is going to expire in two months or three months.”
0:28:22.5 Kurt Baker: Oh, there you go. Oh, so then you notify the clients to update it?
0:28:25.7 Adrienne Dove: I notify the client, but they also get the message as well.
0:28:28.3 Kurt Baker: Oh, that’s even better.
0:28:29.7 Adrienne Dove: Yeah.
0:28:30.4 Kurt Baker: So that warns them that, “Hey, you really need to go through and update it.” ‘Cause I know all of us have had the situation where you run so many things through a credit card. It’s like… I mean, unless you go back through the card and actually identify every single item, which most of us aren’t gonna sit and do, it’s better to just get the note, oh, okay, fine, I got a link, update it, boom, there you go. There’s new info, it’s the end of it. It just makes it much easier, I think, for everyone. So I think that’s smart from a customer service standpoint and from a business owner standpoint. So the good news is these things are available from electronic standpoint that you don’t have to do this yourself.
0:29:01.9 Adrienne Dove: Correct.
0:29:02.2 Kurt Baker: The computer will do it, which is awesome.
0:29:04.3 Adrienne Dove: Yes.
0:29:04.7 Kurt Baker: Okay. So now we’re getting paid on time, which is fantastic. [laughter]
0:29:07.9 Adrienne Dove: Yes, we get paid upfront, and you as the service provider, you need to make sure that you provide that service on time because you might get paid on the first or fifth of the month, and I have the… For most of my clients or all of them, I target to have their books done by the 10th day of the month. You just have to make sure that you’re delivering the service that you promised, but you don’t have to chase after clients to pay a bill anymore.
0:29:32.0 Kurt Baker: Okay. Well, that’s a great way to do things. So we’ve got no more accounts receivable, hopefully, if we can avoid it whenever possible.
0:29:40.2 Adrienne Dove: If you can avoid it.
0:29:41.2 Kurt Baker: Yeah. It’s like we can ’cause we’re dealing with government agencies and they can’t pay you upfront. It’s against the rules. We can’t… In our case, until the service is provided, we can’t get paid.
0:29:54.0 Adrienne Dove: Okay.
0:29:54.4 Kurt Baker: That’s just the way they work. And we’re like, “Okay, fine.” But you get the contract upfront, which means when you provide the service, then you can invoice and they can pay you, and so we have to follow that process. So that’s still an older… In my view, that’s a little over process, and who knows how long it’s gonna be. But at some point, maybe they’ll get on board with something like this, where once it’s contracted, then they could say, “Okay, services are provided on this date.” Boom, confirm. Okay, the payment went through. Done. But they have a system in place, which is a little older, it’s a little for them, but it works.
0:30:19.0 Adrienne Dove: This is a system that works, right? So for a business like that, you just need to stay on top of your accounts receivable aging, so… Yeah.
0:30:26.9 Kurt Baker: Right. And it does work, it’s just a few more steps involved in it. So some of the other things that you’re doing now to help make the business more efficient there?
0:30:35.2 Adrienne Dove: Yeah, so I have a virtual firm, so one of the things about the accounting and bookkeeping world is there’s different firms that provide different types of services, and you have to decide what it is that you wanna do when you are setting up your firm. I started out where I actually started out doing some virtual and then some in-house, meaning that I would go into a client’s office, sit for a couple of hours, however, a week or a month, and do their books. But as I’m grown and going into year number five, I am a completely virtual firm. So one of the things I have to do is when I look for my ideal client that’s top on the list, they need to be comfortable collaborating with me in a virtual environment. And a lot of my clients are local there in the Princeton area, and doesn’t mean that I can’t drop in and meet with them, like if there’s something that needs to be done where I need to be there in person, but the normal monthly process is done in a virtual environment. And so what does that mean? One of the things, this buzzword in the virtual bookkeeping world is tech stack.
0:31:53.1 Kurt Baker: Tech stack?
0:31:53.5 Adrienne Dove: What is your tech stack? Like what are you using to make your process efficient, to make sure that you have correct workflows in place where you can get your clients’ books done in a very efficient and timely manner on the monthly basis, and that includes how do you interact with them? So you probably need to have something like Zoom or some kind of e-meet, something where you can meet with them virtually, it includes practice management software. So I told you like the software that I use where I send my clients a contract and all of the pricing and the payment information is all rolled into one. It includes storage, like if you need to have some kind of Dropbox or some kind of Google Drive where clients have a secure place to upload information when you need it from them, there’s different apps out there where you can pull bank statements and credit cards and those documents can get attached to the actual accounting software, so…
0:33:03.6 Kurt Baker: Yeah. Explain that one to me, if you don’t mind. That one, I’m not familiar with. How do you pull a bank statement in a credit? How do you do that?
0:33:09.8 Adrienne Dove: So there’s different systems, so QuickBooks Online, which is the accounting software that I use, depending on the bank, because certain banks, they… QuickBooks has, I guess, contracts or operational agreements with certain banks, so I know… I’ll just mention some of them, TD Bank, Santander Bank, Wells Fargo, that when you connect your bank account to QuickBooks, it’s considered online banking. At the end of every month, they automatically upload a bank statement. And that’s great. There’s some banks who don’t. So PNC, Chase, Bank of America, they don’t do that. And so as part of the monthly process, first thing you do is you categorize transactions, and then you need to reconcile bank and credit card statements to what’s in the books, and so you need copies of those statements. So there’s Hubdoc, there’s Dext. These are just different apps that attach to the accounting software where you can actually pull those statements and get copies of those statements. And the transactions are already sitting in QuickBooks because of the online bank fee that’s attached to the bank.
0:34:29.7 Kurt Baker: Okay. So I’ve got lost a little bit there. So some of them, I understand where you sync that up. We have this where we sync… You log into the account, you sync it up and it automatically just brings it in. That, we have, ’cause I guess we have… TD Bank is who we use for the non-profit, so it syncs it up. So you can line them all up. Now, the ones that don’t do that, how does… You were explaining like, how does that work? Let’s say I had Bank of America or Chase or one of the ones that don’t automatically do that for you.
0:34:54.1 Adrienne Dove: So just to clarify, just about every bank that I’ve ever worked with, you can have a bank feed with QuickBooks, QuickBooks Online. So even though I said Chase and I said… I think it was…
0:35:12.2 Kurt Baker: Bank of America.
0:35:12.7 Adrienne Dove: Bank of America and PNC, they all have bank feeds that attach to QuickBooks, but they don’t attach the statement to QuickBooks.
0:35:21.1 Kurt Baker: Oh, I see. So the physical statement is not?
0:35:22.7 Adrienne Dove: The physical statement, which is part of the reconciliation process because the reconciliation process is all of the transactions that I have categorized during the month, those are considered the books, and the reconciliation is to reconcile the books to the bank, and what’s in the bank is on the statement.
0:35:44.1 Kurt Baker: Gotcha.
0:35:45.4 Adrienne Dove: So these are different ways. Like the old style to do it is to go in your client’s office and make copies of bank statements or have them drop them off, and there’s some people that still do that, but in the virtual firm, which we call the firm of the future, there is a way to do that that’s in the cloud, is done in a virtual environment, and it’s very efficient.
0:36:07.9 Kurt Baker: Okay. Alright. Okay, so yes, I get it. So some of them actually upload the statement for now. The ones that don’t, you just have to upload that yourself and then that’s the process?
0:36:16.6 Adrienne Dove: It’s a process, ’cause I have a monthly workflow, and one of the things I have to do is educate my clients when they first onboard them, “This is how we work.”
0:36:25.6 Kurt Baker: Gotcha.
0:36:26.0 Adrienne Dove: “So at the end of the month, or a couple of days after the month, I need you to upload this bank statement.” If you don’t have one of those banks always uploaded automatically.
0:36:35.6 Kurt Baker: Got it. Okay, so now I got… My books are all reconciled. And we’re gonna take another quick break. You’re listening to Master Your Finances. We will be right back.
0:36:44.7 ANNOUNCER: This is Master Your Finances with Kurt Baker, certified financial planner professional. Learn about tax efficiency, liability, owning, managing and saving your money and more from Kurt and his experienced panel of guests. Master Your Finances is underwritten and part by Certified Wealth Management and Investment and Rider University. Rider University offers flexible education for adult learners. For more information, it’s
0:37:17.5 Kurt Baker: Welcome back. You’re listening to Master Your Finances. I’m here with Adrianne Dove and we’ve been having some fun. Now we got all our money coming in. We don’t have to wait for any accounts receivable, no aging reports. Our books are all categorized and good to go. So now what happens? What do we do now? Now we got everything all set, we’re ready to go. [laughter]
0:37:33.9 Adrienne Dove: Yeah. I mean, there’s a process, there’s a monthly process, and like I said, it’s categorizing transactions doing reconciliations, you wanna reconcile all bank and credit card statements, and then there’s a process that we accounting professionals go through where we close the books so we see if there’s any adjustments that we need to make and then we’re able to generate financial statements for clients so they can see how they’re performing.
0:38:02.6 Kurt Baker: Okay. Well, that is awesome. So now what’s next for you? I know you’ve been doing this for a couple of years now so give us a little bit of view point on the big picture of your firm and what you guys see coming down the road?
0:38:15.2 Adrienne Dove: Well, I’m happy to be celebrating five years in a couple of months. I came out of a corporate environment and I never thought that I would be an entrepreneur, but it’s the best job I’ve ever had. I absolutely love it. And at this point in the life of my firm, I think I’m at a point where I probably need some help either a W-2 or a contracted person because of the growth. I also spend a lot of time just being a student. It’s in this virtual accounting and bookkeeping where you have to be a life-long learner because especially if you are a virtual firm, things are always changing in the Cloud, there’s always another app, there’s always another workflow or a process that can make the process that you have working with your clients that can make it more efficient, there’s always new ways to help your clients be more efficient. And so I personally am on webinars every month, QuickBooks as a QuickBooks ProAdvisor, a certified ProAdvisor. All of the education to us is free and so every month we are on a different webinar talking about new things that are happening in the industry. There’s a couple of big conferences that I go to every year.
0:39:35.6 Adrienne Dove: QuickBooks has a huge conference which is in… The last one was in December there is another… And it’s called QuickBooks Connect. There’s another firm it’s called Scaling New Heights which is really geared for the Virtual accounting and bookkeeping firms and I think I’m gonna be going to my first conference this June in St. Louis. And then another thing that I love to do in addition to networking because that’s all part of being an entrepreneur is building relationships with small businesses. I like to network with other entrepreneurs that do the same thing that I do, so other virtual bookkeeping firms. And then just other people that do accounting and bookkeeping because in the real world, you would love to engage every time a client comes to you, you would love for that to be your ideal client but that’s not the real world. And so if a person comes to me and I’ve had this recently, a non-profit said that they needed me to come into their office three days a week. Well, I’m a virtual firm. Like I said before, I don’t mind going into my client’s offices if it’s needed, but in the normal monthly process that’s not part of my workflow.
0:40:57.4 Adrienne Dove: So I found someone in my network who… This is a person who has a virtual firm like myself, but he has a team and he has a team… Some of his bookkeepers and accountants are local they live around here in the Princeton area and I was able to give him that referral and he in turn gave me a referral that wasn’t right for him. And so to me that’s the beauty. There’s enough work to go around for all of us. It’s not a competitive… It doesn’t need to be competitive ’cause we can support each other. And recently, in the virtual bookkeeping world especially if you don’t have a staff like myself, it could be a little isolating. So you’re working by yourself, but of course you engage with your clients. So I am connected with… Right now, it’s three other women who have virtual firms. Two of us are in New Jersey. I think one is in Ohio and I think the other one is in Florida. We are starting what we’re calling a virtual bookkeeping and accounting mastermind group.
0:42:00.0 Kurt Baker: That’s awesome.
0:42:01.1 Adrienne Dove: Where we meet once a month and we just talk about what’s going on in the industry. Some of us are in different places in our journey. So for me at year number five, I’m at a point where I need to hire someone and I know someone in the mastermind group has a staff of five or six people. And so it’s a place where we can share best practices, we can help each other and we can also pass business to one another because there are… I also know that in this virtual bookkeeping and accounting world there are some people who are very specialized so they only do restaurants, or they only do retail, they only do law firms. And that’s another thing, if I find someone. ’cause I don’t do restaurants. And so one of the first things I did when I went to the last QuickBooks conference that I went to is I found a couple of accounting firms that’s their niche, they specialize in restaurants and they may not be in New Jersey, but they can work with a restaurant anywhere. So I think that’s a big part of me being a virtual firm owner and as part of my growth is to network and just stay connected with other firms that do the same thing that I do.
0:43:16.8 Kurt Baker: Yeah. You’re preaching to the choir here ’cause this is something that I think I bumped along in the chamber, and this is something we talk a lot about at the chambers, it is like, Oh, well, I can’t share information with my “competitors.” And honestly, if you work with people that you “consider” your competitor you’re actually gonna both get more business because you’re gonna end up specializing and I think most of us have… Whether it’s specializing as a virtual business or whether it’s specializing in restaurants. In my case, it’s high network business owners. It doesn’t really matter because there’ll be people that you’re not focused on any longer and you’re gonna get really, really good at what you are focused on. And so your peers, I like to call them my peers, they will refer people to you that are more appropriate and I refer people myself to other advisor, I refer to other advisors because there’s plenty of business for everyone.
0:44:07.0 Adrienne Dove: There is.
0:44:07.7 Kurt Baker: Especially if you’re an entrepreneur and your concern is taking care of your clients, serving them well and getting the best deal for them that you possibly can and then connecting somebody that’s not a good fit, not your ideal client as you pointed out, with somebody that would work well with them. Now everybody’s happy. Your client’s happy, you’re happy ’cause you were able to hand them off to somebody and the other person’s happy because now they have a little bit of business in their area of expertise. And I think a lot of people don’t spend enough time networking with their peers. And as what you do, I belong to a mastermind group of people who just focus on the high net worth business. And you learn a lot from each other and there’s never any fear of this getting clients. It just doesn’t happen. If it ever did happen, they’d be out of the group. That’d be the end of them.
0:44:49.8 Kurt Baker: So it’s just not gonna happen the way a lot of people that are especially new at this don’t realize that sharing information with your peers helps you both become educated especially in the day and age now where things move very quickly like, what software do you use? Hey, this just changed last month, how do you handling that change? You all will learn from each other very quickly and you’ll adjust to whatever that change is and you all win. And so I…
0:45:14.2 Adrienne Dove: Yes. Yeah, it’s a win win.
0:45:15.5 Kurt Baker: Yeah, exactly. And I really try to emphasize that to people. But I know when people start off, they’re like, “Oh I can’t. This is… I got my secret world, and I can’t… ” No. Everybody… It’s the same world, and there are…
0:45:24.9 Adrienne Dove: It’s the same world. We all have the same goal, we wanna grow our businesses, but we also wanna help other people.
0:45:31.0 Kurt Baker: Correct.
0:45:35.9 Adrienne Dove: And then mentoring ’cause when I started in this virtual world, I had other virtual firm owners who gave me information for free, they shared their workflows they shared different software, they talked to me about things to look out for. In this world, the mastermind group is important, but also kind of bringing somebody else along who may… There are people that where I was five years ago. And so that’s been my journey in this entrepreneurial virtual accounting world. This is where we are today.
0:46:11.9 Kurt Baker: That’s awesome. So what are your next steps? What do you plan on doing now? I know you think you’re gonna grow a little bit. So what do you see in the next five years?
0:46:20.7 Adrienne Dove: In the next five years, I definitely wanna continue to grow, but I think I’d like to have more of a niche. I’m not exactly sure what that’s gonna be. Right now I have the mastermind group, I also have a coach that I’m gonna be starting with who specializes in virtual bookkeeping firms.
0:46:40.1 Kurt Baker: That’s awesome.
0:46:40.6 Adrienne Dove: She’s really great. I’ve taken a lot of her courses. And in my first meeting with her she told me she’s been doing this for 15 years. And…
0:46:48.0 Kurt Baker: In the virtual world? That’s awesome. How long has it been around? [laughter]
0:46:52.2 Adrienne Dove: Well, she started with QuickBooks Online I think when it was relatively new.
0:46:56.7 Kurt Baker: Wow. I know, that’s sort of the thing.
0:47:00.7 Adrienne Dove: Yeah. So I think in the next five years I would like to… I definitely wanna learn a lot from that coaching in the mastermind but then I wanna be in a position to maybe help someone and to give coaching also. There’s always somebody that is coming behind you that could use the help. I got a lot of help when I started back in 2018.
0:47:18.8 Kurt Baker: That’s just awesome. So any final notes before we head off? This is a great experience. I love having you back. Appreciate it.
0:47:26.2 Adrienne Dove: It’s great to be back because when I… I guess when I was here in 2019 it was a completely different conversation.
0:47:32.8 Kurt Baker: It was.
0:47:33.7 Adrienne Dove: Because I was a very new entrepreneur and I was still transitioning, understanding the culture of being in pharma in a large corporation and working with small businesses.
0:47:45.0 Kurt Baker: Being in a small business is very different than working for a big company?
0:47:47.1 Adrienne Dove: It’s very different. I absolutely love it. I say this is the best job I’ve ever had.
0:47:51.0 Kurt Baker: Well, that’s awesome. Adrienne, thanks again for coming on. We appreciate it very much. You’re listening to Master Your Finances. Have a wonderful day.
0:47:58.1 ANNOUNCER: That was this week’s episode of Master Your Finances with Kurt Baker, a certified financial planner professional. Tune in every Sunday at 9:00 AM to expand your knowledge in building and managing your wealth. Missed an episode? No worries, you can subscribe to a free weekly episode of Master Your Finances to listen to on your favorite podcasting platform, Apple, Spotify, Google podcasts, whatever. Master Your Finances is underwritten in part by Certified Wealth Management and Investment and Rider University. Rider offers continuing studies programs for adults who need flexibility. Want to add new skills to your resume? Take a continuing studies course at Rider University.

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