New Year’s Resolutions for the Small Business Owner

by Dan McCauley, Partner, CPA, ABV

Each January people all across the country resolve to do things differently in the coming year. Some are life-changing resolutions; others simply make good sense. As a business owner, now is a prime time to review your business practices and improve your business systems. Here are a few “good sense” ideas that may turn out to be life changing!

Goal setting is the beginning of the process. Goals should be identified and written down with specific action plans and timelines to ensure progress can be easily measured. Be aware of any obstacles that could impede progress. Enlist the right people to assist you in reaching your goals. Obtain the knowledge and skills that you need to competently reach those goals. Lastly, yet first in importance, dedicate at least 10 to 15 minutes daily to work actively on your goals.

As a business owner, one of your best moves may be as simple as making certain that proper documentation is obtained to support your well deserved tax deductions. If you have a business vehicle, a log that reflects the business usage is required. It should include the date of each use, mileage per trip, business purpose of each trip, destination, and total mileage driven on the vehicle for the entire year.

Another area that requires extra documentation is business meals and entertainment. It is the responsibility of the business owner to set forth how the meal or entertainment is directly related to the business.

For each activity, who attended, what was discussed, when and where the event occurred as well as why the event was beneficial to the business should be retained along with the receipt.

Many businesses create an outside advisory board, typically made up of professionals with business knowledge and technical skills rather than honorary positions. The board serves as a team to advise you as a business owner. They can assist with business plan development, marketing strategies, assisting with financing needs or maximizing operational efficiency.

Another important resolution for any business owner is to ensure that the business succession plan is in place. Signed and executed buy-sell documents are a crucial part of this plan when other owners are involved. A thoughtfully drafted will is a necessary element in a good succession plan. Advance consideration should also be given to the emotional aspects of business succession. How does it impact you as owner, the employees, and other family members? Are you relying on a family member to take over? Are they qualified? There are many questions to be addressed.

A basic resolution of which every good accountant will remind you is to meet regularly with your accountant to discuss your business needs, plan your finances, assist with retirement and succession planning, and help you keep your earnings in your possession rather than paying unnecessary taxes.

Contact Dan_McCauley@mnccpa.com.