May 30, 2002 Giuliani and I Were Together in the Carrier Dome along with approximately 20,000 people for the Commencement ceremony of Syracuse University. The difference was, I was there to kvell as my oldest daughter, the commercial designer, was graduating from the School of Visual and Performing Arts. She is the one whose paintings adorn the office. The media played up the fact that Rudy had agreed to speak at only two graduations and this was the only one in New York. Additionally, the students and faculty were allowed to protest his presence and it looked like hundreds of black and hispanic parents and students protested his presence. The media wrote that. What they did not write was about the thunderous applause and standing ovation from the rest of us that rocked the stadium. Thought you would like to know what really happened. And yes, we enjoyed graduation weekend. Now all she needs is a job! Consulting Attracts IRS Interest Business consulting is a fast growing field populated by veterans who have always made a living advising others, newcomers who become independent contractors after a downsizing (sometimes working for the very company that laid them off) and layoff victims who do small jobs here and there while searching for full-time employment. The IRS has taken notice of this field and has the following concerns: employee v. independent contractor, personal service corporation, hobby loss rules, travel deductions and reimbursed expenses. IRS Market Segment Specialization Program Audit Technique Guide on Business Consultants Project Number 3123-102 (3/1/01). Notice My mother sent me this one. Did you ever notice what happens when you put these two words together, THE and IRS? How to Control Your Company’s Cash Today, mastering your company’s cash is more critical and challenging than ever. Is a robust recovery imminent? If so, should you be spending now to build new revenues? Or will the second half of 2002 be sluggish, demanding tightfisted expense controls? Of course, no one can answer with any certainty. But there are things you can do to prepare for either outcome. First, managing your company’s cash flow goes beyond simply increasing revenues and decreasing expenses. Here are other things to consider: 1. Take credit: If your business does not accept credit card purchases, you may be missing the larger average purchases that credit cards produce. Cards reduce “float”, which means you get faster access to funds. And, they can also reduce collection snafus. You may even want to consider becoming a “e-merchant” so that you can accept web transactions--another growing channel. 2. Get credit: If you do not already have a line of credit, open one today. Ample credit lets you take advantage of vendor discounts--and weather periodic cash shortfalls. 3. Lease it: Why buy equipment that may be quickly outdated? Leasing gives you the flexibility to adapt new technologies for new efficiencies--and saves your cash for other essentials. 4. Outsource some resources: Look for ways to reduce your daily overhead. Payroll services, IT support, component production . . .there are many ways to fund outside resources less expensively and more flexibly than in-house providers. And you’re freed up to spend more time building revenues. 5. Lock in a lockbox: Talk to your bank about how a lockbox service can give you faster access to your funds. Checks mailed to a lockbox, rather than your company, can clear days faster--and less expensively. 6. Sweep-up: Ask your bank about a “sweep account” that automatically transfers funds overnight into a higher-interest account. Your funds remain liquid and earn a more solid return. 7. Get online: If your company is not already doing its banking online, investigate this time-saving option today. Not only is online banking more efficient, it lets you manage your business after-hours and on weekends--wherever you are. That lets you devote the days “business hours” to doing real business, not banking. 8. Go direct: Consider two more time saving options: direct deposit of payroll to your employees’ checking accounts; and, acceptance of ACH payments. Direct deposit is less costly than generating payroll checks, and more convenient for your employees who no longer need to rush to the bank on paydays (and many banks offer discounts on monthly account fees with direct deposit). Accepting ACH payments not only means that funds will settle faster, their electronic nature also makes them less costly. 9. To the swift, rewards: Consider creative ways to reward prompt payers. Invoice discounts are standard practices. But there are ways to thank efficient payers. Trips, industry subscriptions, professional memberships, or other unique incentives may be more meaningful to high-value customers, and less costly than invoice discounts. Use your imagination! There are many ways to better manage your money. Controlling its ebb and flow will give your company smoother sailing in the turbulent times ahead. Testing, Testing, One, Two, Three We would like to test sending this newsletter to a select number of you in the future via e-mail. Please send your current e-mail address to [email protected]. If you have any questions about these or any other tax or financial matters, please call us. Remember, We’re Here For You!