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Wage & Hour Update: Pro-Ration of Minimum Salary For Part-Time Exempt Employees Disallowed

Posted by Christopher Olmsted on
 06/30/2008

The U.S. Department of Labor recently issued an opinion letter on the topic of pro-rated salaries for exempt employees.

An employer inquired whether it is an acceptable practice to pro-rate the minimum allowable salary of an exempt employee to reflect his 20 hour per week part-time status, by paying the worker $15,000. In a letter dated February 14, 2008, the DOL responded that salary pro-ration is not allowed.

The rule applies to all exempt classifications subject to the salary test. The most common exempt classifications are executive, administrative, and professional. Properly classified exempt employees are not entitled to overtime and are exempt from various other wage and hour rules. To qualify, exempt workers must be paid a minimum salary set by law, and also perform certain defined duties.

Under federal law, exempt employees must be paid a minimum salary of $23,660 annually, or $455 per week. This minimum amount must be paid even if the employee works part time. An employer wishing to pay an employee less than the minimum would have to classify the worker as a regular hourly non-exempt employee.

The minimum may be higher in some states. For example, in California the minimum salary is higher: $33,280 or $640 per week. As under federal law, payment below the statutory minimum would cause the employee to lose exempt status.

Employers are reminded that paying the minimum salary does not necessarily qualify employees for exempt status. Under both state and federal law, the employee must also meet a “duties test” that focuses on the job duties of the employee.

For more details, here’s the link to the DOL opinion letter.

The article presented herein is intended as a brief overview of the law and is not intended to substitute as legal advice. Any questions or concerns regarding any statute or case law should be addressed to a licensed attorney.

Categories : Employment Law
Tags : Christopher Olmsted, Employment Law, Human Resources

Make Bank Reconcilations Easier Using the “Locate Discrepancies” Feature

Posted by Teri Milligan on
 06/30/2008

Over the next few months I’m going to give quick tips about the bank reconciliation feature in QuickBooksTM. There are a lot of wonderful tools that are part of the bank reconciliation feature and learning just a couple of them can make your life a little easier.

One of the little known features in the bank reconciliation feature of QuickBooksTM is the “Locate Discrepancies” button that you see when you are entering your bank statement information. It’s in the first screen, at the bottom, after clicking on “Bank Reconciliation” from the Home Page or from the Banking Menu.

Since it is so easy to delete or change transactions in QuickBooksTM, this button can come in very handy. You would want to click on this button if the beginning balance from your bank statement does not match the beginning balance when you begin your bank reconciliation. If you click on this button, it will alert you to what has changed, in your records, since you last reconciled your bank statement in QuickBooksTM. Using this information, you can re-input the deleted/changed items and clear them through your current bank reconciliation, which will get your back on track.

If what is showing in the discrepancies window is something that really should not be part of your records, then re-input the data as stated above and then correct it in the current period so that your bank reconciliations for past periods always remain correct.

Categories : QuickBooks Tips
Tags : Financial Management

Drumming Up Business During Slow Times

Posted by Linnea Blair on
 06/30/2008

Every economy and every business has its ups and downs. The trick to weathering the storms successfully is to be prepared for them.

Reactivate Dormant Accounts
The quickest and easiest way to do this is to sit down with your list of past customers, call them, say hello, and see what’s going on. Don’t make this a hard sell call, just a reminder that you have done business before and you are interested in working with them again. You don’t have to ask for work directly but when you end the conversation you might say something like, “Well, it’s been good talking with you. Keep in touch, and if there’s anything I can ever help you with, don’t hesitate to give me a call.” If you are uncomfortable about phoning, send a letter, flyer or brochure that mentions new products or services and includes testimonials from other customers.

Provide Superior Service To Current Customers
When business is slow you want to do everything you can to hold on to your existing customers. The best way to hold on to them is to give them not just their money’s worth, but more than their money’s worth. Now is the time to go the extra distance, give that little bit of extra service that can mean the difference between dazzling them and merely satisfying them. The best protection against a downturn in business is an active list of delighted customers.

Have Existing Customers Drum Up New Business For You
It’s probably fair to say that the customers you’re currently dealing with associate with like-minded people – people who are in a similar income bracket, have similar interests, hobbies, and buying habits. And therein lies your sleeping giant. A referral system can harness this giant by encouraging existing customers to refer these people to you. If it’s true that most of your customers are happy with your business and the products and services you sell, then it follows that most would be quite happy to refer you given an easy way to do so, such as displaying your brochures in their business. Slow times also provide the opportunity for more active networking, looking for opportunities that may only present themselves when talking to people.

Plan An Ongoing Marketing Campaign
Slow business presents an opportunity to increase the amount of your time spent on prospecting for new business. During a lull in business you need to make this extra effort to attract clients or customers, follow up on leads and close sales. What types of marketing work best in slow times? Use a combination that includes direct marketing (direct response print ads, sales letters, self mailers, postcards, special offers) plus low-cost/no-cost visibility enhancing publicity techniques (press releases, articles, speeches, booklets, seminars, newsletters). Avoid costly image building marketing such as large space ads, slick corporate brochures, expensive annual reports and other marketing communications that can drain your budget without producing sales.

Add Value To Your Existing Services
In a slow economy customers are more concerned with price than ever before. Actually, their real concern is making sure they get the best value for their money. You can win new customers and retain existing ones by enhancing your services and providing your customers with more value for their money. For instance, if you are selling a commodity item you could add value by offering faster delivery than your competitors. Or a wider selection. Or easier payment terms. Or a better guarantee. There is no need to give away the store and promise an excessive amount of extra service. The extras you provide need not take a lot of time or cost a lot of money.

Keep Busy By Working ON Your Business
A slow period in your business is a good time to busy yourself with internal projects that will improve the business, such as developing a new marketing strategy, making technical improvements to an existing product, auditing and improving your customer service procedures, revising your newsletter or website, or any of a hundred things that you couldn’t find the time for previously. Now you have the time. So do them.

Information for this article is sourced from RAN ONE.

Categories : Marketing
Tags : Economy, Marketing

June is “Effective Communications” Month

Posted by Cynthia Kyriazis on
 06/01/2008

Graduations, weddings and vacations are usually associated with June. But it’s also the time of year when painting contractors are as busy as ever. Learning to delegate involves being a very effective communicator in order to develop the employee without frustrating them or yourself, while still getting the results you want.

Here are your productivity tips for this month:

1. Learn to delegate. This is a key time management principle. If you have been reluctant to do so, consider that this is the one way to leverage your time. So go on, learn the basics, find the right person and go for it.

2. Guidelines for giving the assignment. Share with the employee the details of what you need done in an organized way. Remember-they may be watching you as a role model. Once you have reviewed what you need done and the timelines involved, have them repeat back to you what they heard. It helps clarify before any is wasted working on the wrong thing or in the wrong order or at the wrong time.

3. Remember to delegate, not micro-manage. You probably learned by making mistakes – so will the employee. It’s part of being human. But you can minimize the mistakes by periodic check-ins, remaining open to questions and communicating effectively.

Categories : Productivity Tips
Tags : Communication, Leadership, Productivity

Using QuickBooks to Produce Your 1099’s

Posted by Teri Milligan on
 12/31/2007

One of the greatest tools in QuickBooksTM is the ability to print 1099’s from within QuickBooksTM.

To set up your system for this feature, go to the preferences, from the Edit menu, then click on Tax: 1099 on the left side, then on the company preferences tab.

Answer the question, “Do you file 1099-MISC forms?”, yes. Then under the account column across from Box 7: Nonemployee Compensation, click the account(s) to which you have coded your vendors that are eligible for 1099’s. click OK.

Make sure that you have coded all of your vendors as eligible for 1099’s and have entered their address and social security number. You can access all of these fields on the “Additional Info” tab after clicking on Edit Vendor for each applicable vendor in the Vendor Center.

Run a QuickBooksTM 1099 detail report to verify that all of the information is correct. You can create this report by going to the reports menu, then choose vendors and payables, and then click 1099 detail. You can alter the report by changing the “1099 Options” at the top of the report, which will give you more information to review.

Once you have set your preferences and verified all your eligible vendors have complete information, it’s time to print your 1099’s. Be sure to purchase preprinted, red paper stock from an office supply store. Your 1099’s must be printed on this particular paper stock or they will not be accepted. Then go to the Vendor menu, click on Print 1099’s/1096 and click on Print 1099’s. From the print screen you will be given the choice to print 1099’s or 1096.

Categories : QuickBooks Tips
Tags : QuickBooks Tips

Realizing the True Value of your Business

Posted by Linnea Blair on
 12/31/2007

f you are planning to sell your business, it’s clearly an advantage to have an objective idea of what it is worth. Even though ultimately a business is worth what a buyer is willing to pay, it’s easy for a seller to undervalue and lose out in the deal or to unrealistically overvalue and miss out on attracting buyers.

Many companies are oddly reluctant to invest in getting an accurate valuation. Even among owners who had tried to sell their business at one stage, a survey reported by CFO.com found that only 12% of them had ever had a formal valuation done. This is surprising. Guessing the value to put on your biggest asset is really risking your future.

There are a number of different valuation methods and different methods may be appropriate for different types of business. For example, if you run a services business there’s little point in evaluating it based on the value of its physical assets. Other methods consider intangibles such as ‘goodwill’, which are difficult to put a figure on but can represent a significant element of the value of some businesses. And value may also be in the eye of the beholder – it will actually be worth different amounts to different people depending on their reason for wanting a business.

A variety of factors are taken into account in ensuring that a valuation is accurate and useful. Primarily, the valuation needs to be in line with hard data, particularly your current and past financial position. Some valuation methods focus on financial data such as profit levels, asset value, cash flow and debt carried by the business. Other factors are not so cut-and-dried. The valuation might incorporate financial projections for the next three to five years. It might consider intangible assets, such as intellectual property like patents and trademarks, brand names and goodwill. You also need to consider the context. Your own company may be doing very well but its value will be diminished if it is part of an industry that is in serious difficulty or in decline overall.

There are over a dozen different valuation methods. The crudest methods operate by rule-of-thumb or ‘multiples’. For example, landscape businesses are estimated to be worth 1 to 1.5 times their discretionary earnings plus the value of their capital assets. However, multiples only give a rough, industry wide ballpark figure for business value. They do not necessarily give the real value of a particular business. More accurate methods include the ‘balance sheet’ approach, which basically subtracts business liabilities from assets. The ‘adjusted book value’ method is similar but uses current market value rather than purchase price or depreciated value.

Retail and manufacturing businesses are generally assessed according to the value of their assets, given that they tend to store large amounts of value in their inventory or capital assets while service company valuation is based on the ‘capitalization of income valuation’ method, which places a heavy emphasis on intangible assets. It’s also possible to calculate the value of a private company by comparing it with an equivalent public company and making appropriate adjustments. Business value can also be estimated by anticipating cash flow over a three to five year period and adjusting that into current dollar terms.

A current valuation can be important at times other than sale. There are numerous business and legal situations that require a detailed valuation, among them: when considering a merger or acquisition; when seeking investment capital; when buying out a partner or implementing an employee stock ownership plan. A properly determined valuation inevitably enters into less pleasant activities such as shareholder disputes and divorce settlements. Tax minimization planning can involve business value, for example in developing estate and gift transfers.

A valuation can also indicate how your business compares to its direct competitors. It can identify the strengths and weaknesses of your business. When a valuation identifies weaknesses, it can help you focus on building long term value into your business. This will improve your outlook in terms of succession and estate planning.

With this many potential situations requiring a business valuation it’s important to have an up-to-date professional estimate of the real value of your business. To get a valid and commercially useful valuation you will need to work closely with a professional who has experience in the area. Your accountant already has a good understanding of your business and will be able to advise you on which valuation method will be best suited to your business circumstances.

Information for this article is sourced from RAN ONE.

Categories : Business Strategy
Tags : Business Planning, Business Strategy, Business Valuation

What’s next?

Posted by Linnea Blair on
 09/09/2007

In my earlier post “What Chuck has learned”, Chuck states, “So, what’s next?” Good question. There always ought to be something “next” to draw us forward, engage our interest, and just keep us from becoming content with the status quo.

I am a big fan (one might say geek) of NBC’s The West Wing. I own all 7 seasons and have watched them all more than once. I always pick up on another snappy bit of dialogue that I missed the first time around…anyway, I digress. Jed Bartlet often uses the phrase “What’s next?” on the show, meaning we’ve mastered that topic, said all we need to say about that, discussed it enough, we’re done, time to move on to the next thing.

Sometimes even when we are not done, even when we are still working on mastering something, it is still time to be thinking about what’s next. So I am creating a whole new category for this blog about new things to be thinking about to move our businesses forward.

Stay tuned!

Categories : What's Next?
Tags : Small Business Coaching, Small Business Consulting

10 Reasons Why You Should Become an On Target Business

Posted by Linnea Blair on
 08/31/2007

1. You will change your business – for the better!

2. You will evolve as a person and a professional

3. You will become a better leader and manager of people

4. You will learn to delegate (better, anyway!)

5. You will learn how to evaluate the progress and success of your business

6. You will become intimately acquainted with your “numbers”

7. You will set goals, develop a plan, take action steps…and see results!

8. You will be able to compare your company to peers in your industry

9. You will develop friends and find mentors among your peers

10. You will keep growing and innovating

11. You will have fun doing it!

Categories : On Target Program
Tags : Advisors On Target, On Target Program, Small Business Coaching, Small Business Consulting

What Chuck Has Learned…

Posted by Chuck Fitzgerald on
 08/31/2007

I have been an On Target Member for 4 years now. What I have learned from Linnea and other members has been priceless. Never do I want to take for granted what I have now, that I did not have just a few years ago. I owe this to Linnea and other members of On Target Program. In my earlier years in business I worked too hard. If I had only done this earlier! Working Smarter not Harder is what the On Target Program is about.

These are just a few of the items that I have gotten from On Target…..

  • Changing from Cash to Accrual basis accounting. THIS IS THE ONLY WAY TO GO
  • Installation of QuickBooks™. WHAT WAS I THINKING BEFORE
  • Establishment of a Budget with comparisons
  • Never Play Credit Card Roulette with Josh…
  • Knowing what my bottom line is at any time.
  • I now know what my Gross Profit is and how important it is to know it all the time.
  • I longer go to the post office or bank
  • Delegation of paying bills
  • It would be a whole book to write what I learned from the shop hops….
  • Establishment of a Merchant Account using Visa and Master card processing
  • Some delegation in Estimating
  • Hiring an Office manager. I am so lucky
  • I longer have to answer my phone or return phone calls.
  • I no longer have to fill out my templates by myself.
  • I have a life again.
  • I have met wonderful people and have established life long friends.
  • Mark and Arthur only like to drink $200 bottle wine.
  • The establishment of a Marketing Plan 6 – 12 months and beyond
  • I have found what marketing works and does not work
  • I have had some of the best times at the conferences. Except when I had to hear John sing…
  • Setting up a Business Plan and working it.
  • I have doubled my business and have been making 3 times more money.
  • More polices have been established on better hiring.
  • I now have all the computers in my office networked.
  • We now use ACT!™
  • Have a better customer database
  • Yes, at times all this has been hard work, but in the end it is worth it…..
  • Delegation feels so good…..
  • Working toward an exit strategy.
  • I have realized how you do not have to do it all by yourself.
  • The On Target Program has made my job fun.
  • Jane and I have loved all the cities we have seen at the conferences…

This would not have happened without On Target.

So what’s next….?

Fitzgerald Painting is ON Target.

Categories : On Target Program
Tags : On Target Program

QuickBooks Tip – Accepting Client Retainers

Posted by Teri Milligan on
 11/27/2006

Do you or do you know someone that accepts retainers from clients?

To accept client retainers in QuickBooks:

1. Create a liability account called “Client Deposits”.
2. Create a new item, type is “service”. Name it “Client Deposit” and then pick the liability account you created called “Client Deposits” in the account field.
3. Then, when you accept a deposit, open a Sales Receipt, pick the client from which you received the deposit. In the item field enter the item called “Client Deposit”, then enter the amount received in the amount field. Complete any other fields you feel necessary. Click save and close.
4. To apply the client deposit to an invoice, create the invoice as you want it, then on the next line down, choose the item “Client Deposit” and enter the retainer amount to apply to the invoice as a negative in the amount field. This will take the retainer out of the liability account and apply it to the invoice.

Next month I’ll show you how to create a client retainer report for each individual client.

To learn more about how you can use QuickBooks in your business, contact me at (619) 463-6851 x2 or teri@terimilligan.com.

Categories : QuickBooks Tips
Tags : Client Deposits, Client Retainers, QuickBooks Tips
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