We Continue to Grow and Expand!
Temperatures are dropping, but things are hot at Fine Point Consulting this fall! We are continuing to grow and expand, and we are very excited to share the news with you!
After many successful years of business, we decided it was time to expand beyond our two locations in our home state of Wisconsin and set up a third shop in Ann Arbor, Michigan. Ann Arbor is an active community known for its amazing parks, the beautiful Huron River, and over 386 restaurants. It is truly an incredible city and one that Fine Point is proud to now call home.
The new Ann Arbor office is managed by Lauri Young who has over 20 years of experience in finance and accounting. Lauri is known for her outstanding customer service as well as her passion for the community and her commitment to helping startups in Ann Arbor grow.
We also added a new HR Practice Leader to our growing and expanding HR Solutions. His name is Andy Bohacek and he comes to us with 13 years’ experience in the HR field. Andrew is an alumni speaker with Disrupt Madison and is looking forward to launching his HR podcast in early 2020.
CEO, Fine Point Consulting
Managing SBIR/STTR Grants
One thing we have specialized in since day one is managing SBIR/STTR grants on behalf of our customers. We realize maintaining compliance by following FAR (Federal Acquisition Regulation) can be both confusing and time-consuming. Fortunately, we thrive on organization! To ensure compliance we set up your chart of accounts in a certain way to segregate direct, indirect, and “unallowable” costs. Here are the steps we take to accomplish this using QuickBooks Online:
Direct costs. Generally speaking, we put all direct costs in the Cost of Goods Sold section of the chart of accounts. One of our main goals as a firm is to make sure we are being as efficient as possible. A long chart of accounts or multiple sections of accounts adds both time and expense to maintain. We always look for ways to use our tools to cut down on extra expense to our customers. By tracking direct costs in the Cost of Goods Sold section, we utilize existing structures within QuickBooks. The accounts within the Cost of Goods Sold map back to the customer’s grant budget categories, such as Direct Labor, Direct Materials, and Direct Subcontractors.
To be compliant, it’s necessary to accumulate direct costs by contract. We typically do this by tracking costs by Customer/Job. Many of our customers have more than one grant, either within the same agency or across multiple agencies. In this scenario, the agency is the Customer and the grant name is the Job. The “Class” field in QuickBooks also works for this, but our preference is to use the “Customer/Job” fields because it allows us to use Class for something else (either now, or down the line as the company grows).
Indirect costs. We typically track indirect costs in a “Customer” in QuickBooks called “G&A” or “Indirect”. This might vary depending on whether the customer has other sources of revenue outside of SBIR grants. Some grantees have multiple pools of indirect costs, such as fringe and G&A. If so, we can track them separately.
To be FAR (SBIR/STTR) compliant, the accounting system must not only track indirect costs, but also must allocate indirect costs back to projects. QuickBooks does not do this part on its own. The allocation of indirect costs can be done outside of QuickBooks in a spreadsheet or it can be done by making journal entries in the system. Again, with our overarching goal of being efficient, we may start by maintaining a simple spreadsheet for a customer with a single grant. Then move to doing journal entries if a customer has multiple grants or a larger Phase II grant. Whether done by journal entry or by spreadsheet, the customer needs to be able to produce a job report for any given period that shows both direct and indirect costs by grant.
Unallowable costs. We have had clients in the past who went a couple of years before they even had an unallowable expense but technically this should be either a section within the chart of accounts or at least an expense account within the chart of accounts. The most common of these types of expenses with our early-stage customers is alcohol, IP-related legal expenses, some advertising expenses, and charitable contributions.
We know how you feel… and yes, we know, accounting is not the most exciting aspect of your business. It can be confusing, complicated, and simply a pain. We also know that you didn’t start your business to do accounting. Lucky for you, we really like accounting – It’s our thing! Don’t let the complexity of managing SBIR/STTR grants bring you down or slow you down. Call us today and we will do the heavy lifting for you!