Streamlining the Accounting Process. Bruce Hoehne, CPA Kiesling Associates LLP

Transcription

1 Streamlining the Accounting Process Bruce Hoehne, CPA Kiesling Associates LLP

2 Overview Analysis of the Accounting Process Understanding the Accounting Activities Working Smarter Meeting Key Commitments & Due Dates Monthly Closing Wireless Accounting Discussion 2

3 Analysis of the Accounting Process Defining Company Expectations Strategic thinking Analytical ability Operational enthusiasm Good communications Leadership Integrity Organization Innovation Emotional maturity 3

4 Analysis of the Accounting Process Understand Responsibilities & Authority Line of authority & communication Areas of responsibility Priorities Areas of concern 4

5 Analysis of the Accounting Process Meeting Company Needs Board of Directors Management Team Know key managers Assist other managers Educate on financial & accounting areas Communicate reporting process Anticipate & resolve conflicts 5

6 Analysis of the Accounting Process Meeting Company Needs (cont.) Management Team Minimize conflicts Keeping communication channels open Clearly identifying expectations Providing equal & consistent information Striving for consensus Nurture constructive conflict Resolving conflicts Being proactive Acknowledging mistakes Losing gracefully Recognizing politics as neutral Focusing on issues and not personalities 6

7 Analysis of the Accounting Process Meeting Company Needs (cont.) Professional Relationships Bankers Attorneys CPAs Insurance Agents & Brokers Computer Consultants Suppliers Customers 7

8 Analysis of the Accounting Process Report Meaningful Information Issue timely reports Keep records simple & clear Maintain accuracy Balance precision with timeliness Ensure reports are being used 8

9 Understanding the Accounting Activities Analysis of Activities Effectiveness Task Frequency Time required monthly Back- up person Procedures or steps in process every procedure Sample documents used in process Output Clearly documented 9

10 Understanding the Accounting Activities Analysis of Activities Effectiveness (cont.) Use information Train back- ups Train new hires Identify time- consuming activities Identify problems/concerns Maximize resources Identify time- consuming tasks Identify efficiency- related problem areas Automate repetitive tasks Use temporary labor to even workloads Encourage personnel Communicate with personnel individually and through meetings 10

11 Working Smarter Managing Time Identify time- consuming activities Where is time spent Set daily goals/priorities Consider: Can process be automated? Could estimation technique be used? Is process still essential? Filter paperwork Revise distribution list Request summaries Have mail screened Scan read 11

12 Working Smarter Managing Time (cont.) Manage e- mails Control meetings Agenda Set time Focus Prioritize work Delegate tasks Strong associates Know skills Essential tasks only Communicate clearly 12

13 Working Smarter Managing Time (cont.) Reduce interruptions Be ruthless with time but gracious with people Block time Return calls/respond to e- mail twice a day Be available certain times for consultation Control phone calls Organize work area Avoid procrastination 13

14 Meeting Key Commitments & Due Dates Identify key items imposed by outside sources and related due dates Payroll checks Tax deposits Lease renewals Management reports Etc. Establish calendar to monitor progress. Tickler file Software 14

15 Monthly Closing Expediting the Monthly Close Examine process to identify bottlenecks and solutions Choose closing cycle weeks Monthly Quarterly Set precision levels for internal reports Abbreviated month- end closing Modified cash basis closing Flash reporting 15

16 Monthly Closing Expediting the Monthly Close (cont.) Other techniques to shorten cycle time Flow chart process and eliminate steps without value Use estimates or budgets for accruals Perform as much as possible before period end Simplify forms Establish cut- off dates Postpone reclassifying and adjusting entries below certain amounts 16

17 Monthly Closing Controlling the monthly close process Journal entry checklist Closing checklist Workpaper checklist GL supporting workpapers Bank reconciliations Subsidiary ledger reconciliation Amortization and depreciation schedules Detailed account analysis schedules Review of GL and Reports Balance sheet Income statement 17

18 Wireless Accounting Selected Topics Inventory Roaming Receivables/Payables Asset Retirement Obligation USAC Revenues and Reporting Prepaid Customers Lease Accounting Uncollectible Allowance Promotions Revenues Advance/Arrears Billed New Accounting Guidance 18

19 Wireless Accounting Inventory Specific unit Average cost Physical counts Write- offs Consortium Promotions 19

20 Wireless Accounting Roaming Receivables/Payables Payable and receivable gross Net vs. non net One month outstanding Stub Monthly accounting 20

21 Wireless Accounting Asset Retirement Obligation (ARO) ARO = Present Value Using a Discount Rate (Future Value of Cost of Removal Today Using Inflation Rate) Estimated Cost of Removal (COR) Discount rate Inflation rate Life 21

22 Wireless Accounting Asset Retirement Obligation (cont.) 1 Record Initial ARO 2 Yearly Depr/Accretion 3 Retirement 4 Gain or Loss on ARO 22

23 Wireless Accounting USAC Revenues and Reporting ETC Funding Two months behind Recent true ups Reporting and Funding 499 Customer charge Safe harbor 23

24 Wireless Accounting Prepaid Customers Growing service Competitive Defer revenue Calculation 24

25 Wireless Accounting Lease Accounting Straight line for lease escalators Recording deferred liability IFRS likes capital leases Commitment disclosure 25

26 Wireless Accounting Uncollectible Allowance Percentage of revenues Percentage of receivables Review aging Bucket allowance Fixed allowance 26

27 Wireless Accounting Promotions Current Contra revenue Still COGS Deferred Rollover minutes (AT&T) Loyalty plan (US Cellular) 27

28 Wireless Accounting Revenues Advance/Arrears Billed Review Billing Items Advanced vs. arrears Number of days Recent numerator 28

29 Wireless Accounting New Accounting Guidance Other comprehensive income presentation Simplified impairment testing Multi- employer pension plan disclosures Revenue Recognition Leases Offsetting 29

30 Summary/Discussion Plan the processes Take time to make time Take a hard look at tasks Leverage Work Routine activities should occur with a systematic process that permits smooth performance of the tasks each month. Meet expectations Have fun!!! 30

31 Bruce Hoehne Partner Madison, WI KIESLING ASSOCIATES LLP Certified Public Accountants and Business Consultants 31