Open Letter to Potential New Customers

Bookkeeping Accounting Concept 2022 12 15 23 07 01 Utc

If you are reading this, you may be thinking about reaching out to learn more about my services.  Just so you know, I’m always up for talking to other real estate investors and learning from their experience.  Even if you don’t end up hiring us for your real estate bookkeeping needs, I’m always willing to talk about real estate as it’s a passion of mine.

I’m a real estate investor and a CPA in the state of Minnesota.  In my former life, I spent 20 years working on large corporate accounting teams.  It wasn’t fulfilling.  Bookkeeping was the realm of accounting that I really enjoyed, and the main reason I chose to study accounting in the first place.

In 2020, I came to work with REI Bookkeepers mostly because I wanted to network with other investors, while doing the sort of work that I enjoyed.  After working in this business for nearly 4 years, I’ve found it helpful to ensure there is alignment on expectations between myself and my clients.  I wanted to write this letter to potential new customers to align those expectations on the front end.

What we do

Before we dive in, I want you to understand the services that we DO provide.  We provide monthly bookkeeping services exclusively to real estate investors.  Customers that typically hire us include House Flippers, Wholesalers, Landlords, and some General Contractors.

We work exclusively with QuickBooks Online (QBO).  If you have another accounting system and want to convert to QBO we can help with that.  However, we do not actively maintain any other accounting systems, including QuickBooks Desktop.

Our bookkeeping process necessitates that we work on your books at least once per week.  Your balance sheet will be reconciled every month.  Our goal is to have your monthly bookkeeping completed by the 10th, and we target the 15th for review and client reporting.  Our baseline reporting package includes your Balance Sheet and Income Statement, but we can tailor your reports however you want them.

In corporate accounting jargon, the “Controller” is the accountant (usually a CPA) that oversees the entire accounting department.  Some CPA firms will offer “Outsourced Controllership” packages to their bookkeeping clients that include access to a CPA.  If you have a controller on your team, you have an experienced accountant on your side.  The core service we offer is bookkeeping, but the experience you are getting is controller-level.  Your books will get a pro-active CPA level review every month.

What we don’t do

We don’t do taxes, and we don’t provide tax advice.  However, we are very familiar with most tax strategies, and structure your books in a way to help your CPA provide this guidance.  

We don’t bill by the hour.  Our fees are based on a value-pricing model that considers the entire scope of your project.  For this reason, we typically don’t work with large companies that require time tracking and daily bookkeeping.  In general, if you have more than $10 million of assets on your balance sheet you may need a full-time accountant on payroll.

We don’t do bookkeeping for property management companies.  We’ve found that the day-to-day operations of property managers require more time than we can give.

We don’t manage your revenue and expenses.  What this means is, we don’t create Invoices or Bills on your behalf.  Revenue and expense are accounted for when received and paid.  Very few of our clients have accounts receivable or payable accounts on their balance sheets.

We don’t manage your payroll.  It is the customers’ responsibility to ensure payroll is scheduled and funded.  We account for your payroll expenses when they are paid, and ensure they are reflected accurately in your books.

We don’t provide outsourced CFO services.  If a company is profitable enough to justify hiring a CFO, then they should also have a full-time accountant.  Most of our clients are individuals who are either building a rental portfolio or operating a real estate business for themselves.  I don’t believe the cost of a CFO service is justified for our target audience.

Communication is critical

The most common misunderstanding that potential new customers have about us relates to their own involvement in the bookkeeping process.  Your input is critical to the success of the engagement. 

Bookkeeping is the process of classifying financial transactions and summarizing them in financial reports.  The key to making your bookkeeping process as painless as possible is timely communication, specifically around what you spend your money on.  We are in constant communication with our clients through our secure client portal.

One of our primary goals is to make your bookkeeping process as touch free as possible.  To achieve this, we ask lots of questions until we have a process in place.  The good news is that we have streamlined the communication process to be as frictionless as possible.

I hope that this letter has provided you with the necessary information to decide whether or not your would like to connect and further discover the possibility of working with us.  I look forward to hearing from you!

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