One of the most difficult and important tasks for a small business owner is deciding where to invest back into the company. Should they upgrade technology or equipment, add to the marketing budget, expand, etc? It can be a painstaking process. Many small businesses are finding that investing in people, whether it’s in hiring the right staff or training and rewarding their current employees, is really having a positive impact on their bottom line and company culture. We explore this and other payroll, human resources, and accounting updates in our July newsletter.
In Brazil, labor laws have been setup up very strictly for the protection of employees, sometimes to a fault.
With that said, employees who do not take their 30-day accrued vacation after their 1st-year employment are entitled to “vacation penalty”. This penalty is paid by the employer and consists of a double vacation payment. So the employee will go on vacation for 30 days and receive 60 days of remuneration on the first day of vacation. Many employees take advantage of this labor law and fail to inform the employer when their vacation is due, forcing their employer to pay the penalty.
Market Trends – Investing in People
For computer-kit startup Piper, hiring a lead developer proved transformative.
The venture-backed San Francisco educational technology company noticed its development speed tripled, “and we could execute on software and product priorities that were previously not available to us,” co-founder Mark Pavlyukovskyy said recently.
“The level of organization, management and team performance that we got by just adding a senior software leader to the team was just amazing,” said Pavlyukovskyy, who appears on this year’s Forbes 30 Under 30 list.
While startups and other small businesses often achieve new growth by investing in technology, equipment, bigger plants or marketing campaigns, sometimes the best move is spending on people – hiring new employees or consultants, or better supporting current team members.
Payroll Update – IRS Revision of W4
The recent release by the IRS of the draft 2019 Form W-4 creates a question for many states: revise their own withholding forms or accept the federal version.
The draft 2019 Form W-4, Employee’s Withholding Allowance Certificate, released June 6 by the Internal Revenue Service, eliminated the use of the personal exemption, the basis of federal income tax withholding and that of many states. Personal exemptions were suspended in the federal tax code overhaul (Pub. L. 115-97) and replaced on the draft W-4, with new fields for employees to indicate additional income, deductions, or credits that may affect taxes owed.
HR Update – Ethics Concerns of Employee Data Collection
HR needs to set a data ethics policy on what information can be collected and how to store and use it appropriately, experts have told HR Dive. As HR tech grows in popularity and data is more easily collected, HR may need to reconsider how and why it uses such data and continually audit its usage to ensure employee trust.
Employees respond poorly to attempts to track them on ostensibly private platforms because they likely don’t understand the purpose or use of such data. Trust is a huge aspect of workplace tech adoption, not just data gathering; if an employee doesn’t trust the employer or its intentions, tech adoption will hit roadblocks and create engagement issues, rather than solve them.
Also, In Case you Missed our Social Media in the Workplace Webinar…
Mary Beth’s Accounting Tip of the Month – Banking Tips
On at least an annual basis take a look at your banking accounts – how many do you have, how much do you pay in fees?, and what is the balance you maintain in any one account?
These are the types of questions you need to ask yourself:
- If you have multiple checking/savings/payroll accounts, consider consolidating. The days when we had “float” (the time it took to process a payment) are basically over.
- Look at the total banking fees you are paying; ask your banker to review your accounts and make sure you are taking advantage of the variety of account combinations available. Remember… that $15 monthly fee is $180 annually that you could be spending somewhere else.
- Ask about bank credit cards that are linked to your checking/savings account(s); can you select an account that earns you travel miles or cash back rewards?
- For companies with large balance amounts: If you have amounts over $500,000 in one bank account, it is probably NOT insured… Again, use your banking contact as a source of information on how to make your cash account balances earn more interest income for your company. As an example, currently (as of June 2018) a $100,000 6-month CD could earn you up to 2% on an annual basis, that’s (without compounding interest) $ 2,000.00 interest income. Don’t let your money “sit”, with a minimal amount of effort your money will work for you. Consider a “sweep” account to take advantage of large cash balances.
- The internet is a great source of checking your current options – there are website that compare banks, credit unions, CD’s and credit cards to find the best fit for your company’s needs.
Quickbooks Tip – Recording a payment received by a client
One of the most common issues new Quickbook users have is forgetting to record a payment received by a client. When you invoice a customer in QBs , here is what you need to do when you receive a payment:
Record a payment toward an invoice
To do this task
- Choose Customers > Receive Payments.
- Click the Received From drop-down arrow and select the customer.
- Enter the amount of the payment.
- Change the date of the payment if necessary.
- Click the appropriate payment method button to indicated the customer’s payment method, for example, cash, check, or credit card. If you don’t see a button for the payment method, click More and select the payment method, or click Add New Payment Method to add it.
How the payment method buttons work
- (Optional) If the customer is paying with a check, enter the check number in the Check # field. Otherwise, enter a reference number in the Reference # field.
- If you haven’t set your preferences to automatically deposit customer payments to Undeposited Funds, click the Deposit To drop-down arrow and choose a bank account into which to deposit this payment.
- (Optional) If the customer has multiple open invoices, adjust the amount in the Payment column for each invoice as necessary.
- Save the payment.
Next month….We will look at the third step in the Invoicing process; making a deposit.