Wednesday, October 21, 2009

Barca Financial Group is starting another periodization schedule

Monday, October 19, 2009

Business Solutions: Key Person Protection

During stressed markets there is a shift on employee retention and recruiting. Many companies are experiencing a great shift of new employees and trying to keep essential personnel to continue profitability. One issue is the Key employee retention or recruiting. A strategy called "Executive Bonus Plan"; the main question business owners should ask what would happen if a key person is no longer there to help drive your business, unfortunately many business owners don't consider the risks of losing a key person until it is too late.
This program can provide your business with the funds needed to help you withstand the financial shock and help sustain your business. By offering an enhanced retirement benefit for your key employees. These are some questions that may help you determine a key person:
  1. Multiple of Salary
  2. Loss of Value to the business
  3. Cost to replace the key person's sales profits and training
  4. Cost to replace the key person's contributions to Income

Case Study

Company X was a successful manufacturing firm. It had a long-term track record, loyal clients and widely regarded products. Company X was dependent on a key sales representative, Paul, who worked at the company for nearly 10 years and had a successful record. Paul passed away prematurely, he had recently signed on one of the company's largest accounts, Paul also worked with two additional accounts that brought in 15 percent of the company's revenue. Luckily Company X held a $1 million Key person policy on Paul's life. this policy provided Company X with the funds needed at a critical time, helping tide over and expand the business.

Cost of replacement

$125,000 was used to recruit, offer a sign-on bonus and relocate a new rep.

$50,000 was allocated to special training and marketing to help the new rep get up to speed more quickly than the average new recruit

Line of Credit

$200,000 was posted as collateral to help keep a creditor from raising the interest on a credit line

Retention Device

$250,000 was paid to Paul's widow. If Paul had survived to retirement, the policy values could have been used to fund a non-qualified retirement benefit to supplement the gap left after market crashes and during recession values.

Financial Planning is critical to prevent unforeseeable losses; preparation is essential to a healthy organization and without a proper device, a company can be lost in a blink of an eye.

Sunday, October 18, 2009

Telephone Excise Tax Refund

Still time to get money back,

Telephone Excise Tax Refund (TETR) not claimed by most eligible companies
During a recession, it is advisable to review the old business plan, streamline expenses and take a second look at your business’s biggest liability: TAXES.
As many as 15.9 million businesses could be eligible to claim refunds under the TETR program. The government has earmarked $11 billion for it but only 5.6% of eligible businesses have requested a refund. To help determine why so few businesses filed for TETR, the Treasury Department surveyed business tax return professionals. The survey revealed 35% of the preparers surveyed stated that their clients did not qualify for the TETR. 44% believed the amount of work and associated fees to compute the refund was not worth the refund. 20% either forgot to claim TETR for their clients or were unaware of the refund program.
TETRs could recoup much needed funds for companies feeling the pinch of the current economy. The deadline for the TETR program is April 15, 2010. Claims may be based on a formula or by performing a telephone bill audit. Some professional telecommunications auditing companies offer free audits, charging a percentage of refunds. Ask potential auditing firms, does your company:
offer local or long distance services? Steer clear unless you’re interested in changing carriers.
have expertise in auditing telecom bills specifically?
charge a fee for the audit if there is no refund due?
have ability to perform the audit and submit a report in time to meet the April deadline?
have references from telecom audit clients?
Knowledge is power as long as you do something with it.
Contact us to learn how to claim your excise credit.