The Greater Houston Partnership’s next Houston Young Professionals and Entrepreneurs (HYPE) event, “Explore Your Passion,” is coming up on February 20, 2019.

The event, sponsored by PKF Texas, is designed PechaKucha style where young professionals can meet, talk and interact with various not-for-profit and volunteer organizations. Young professionals will have the opportunity to network and find their purpose to make a difference in Houston – whether it’s in youth development, education, health, social services, crisis services, family services and more.

For more information and to register, visit www.houston.org.

Stay up to date with more Houston events at our website: www.PKFTexas.com/Calendar.

We are excited to announce we have a new Director joining our firm. His name is Matthew Goldston, CPA, CM&AA, CVA, and he is joining our Entrepreneurial Advisory Services team.

Matthew’s experience as a CFO includes leading multiple companies through transactions from mergers and acquisitions to integrations, spin-offs and successful exits. Additionally, he has extensive experience with growth consulting, audit and business valuation. In addition, he has served industries including manufacturing, technology, construction, industrial services and private equity.

“PKF Texas continually evaluates ways to further enhance our client service offerings,” said Byron Hebert, CPA, CTP, Chief Growth Officer. “With the experience Matt brings to the firm, we have added another layer to our ability to co-develop solutions with our clients who may be considering a transaction.”

To learn more about Matthew, visit our website!

Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I’m back again with Danielle Supkis Cheek, a director on our Entrepreneurial Advisory Services team. Danielle, welcome back to the Playbook.

Danielle: Thanks for having me again.

Jen: So a few episodes back we talked about revenue recognition. Another one of our directors has also talked about it. What are the steps a company needs to take for revenue recognition?

Danielle: The actual standard has five steps that you need to take. From an operational standpoint, you’ll have to figure out what operations you need and how this changes things to see if you need operational steps.

But from a pure, “What does the standard require?”

  • Step one: you actually have to identify – do you have a contract or not, and what is the contract?
  • Then within the contract you have to identify the specific performance obligations. It can get a little tricky – are you delivering the walls of a house and a foundation or an entire house?
  • Then what you need to do is actually determine the transaction price; sounds simple but sometimes with contingent consideration, it can get pretty tricky.
  • Then you allocate that price to the specific performance obligations. Okay, you with me?
  • And then you get a recognized revenue at the very end – step five.

Jen: Great. Thanks for sharing those five steps with us, and I know we can find it at PKFTexas.com on our Revenue Recognition Central. Is there going to be more content coming soon?

Danielle: Of course. It’s an ever-changing standard and an ever-changing area, so yeah, we’re going to keep it updated.

Jen: Perfect, thanks. For more about this topic, visit PKFTexas.com. This has been another Thought Leader production brought to you by PKF Texas The Entrepreneur’s Playbook. Tune in next week for another chapter.

Jen:  This is the PKF Texas Entrepreneur’s Playbook.  I’m Jen Lemanski, this week’s host, and I’m here today with Danielle Supkis Cheek, a director on our Entrepreneurial Advisory Services Team.  Welcome back to the Playbook, Danielle.

Danielle:  Thank you.

Jen:  So our Entrepreneurial Advisory Services Team tends to work with startups quite a bit, and I know you’ve got a lot of – your background is in the startup space – what’s your advice for them to get their accounting started off [on] the right foot for bankers, financials, all that kind of stuff?

Danielle:  That’s a big area.

Jen:  It is.

Danielle:  For either pre-revenues or startup companies and those with not a lot of operation experience, it can be a really overwhelming task in the first place.  Usually you need to start with some kind of model, because you don’t actually have any revenues or any transactions to actually account for, and then it all the way moves to once they start having transactions and the accounting.  So in the more pre-idea stage on that modeling aspect my biggest piece of advice is really to think through every single step of your day, and make sure every single step of that day – once you’re in your future operations – is accounted for somehow in your model.  So if you’re showing up to an office, there should be rent on your books somewhere or in your model.

Continue Reading Tax and Accounting Tips for Startups

Hi, my name is Byron Hebert, and this is another quick Tool Time update by PKF Entrepreneur Playbook. What I want to talk to you today about is the sustainable competitive advantage and strategic planning.

A lot of people talk about strategic planning but they really don’t know where to start. Where you start is with your sustainable competitive advantage. What is that one thing about your company that separates you from your competition? That’s what you want to focus on. That will drive your marketing; the promise that you’re going to make to the marketplace about what your company can do.

That, in turn, will drive your operations so that you can deliver on the promise you’ve made to the marketplace. Now what drives that? That’s driven by your people, your innovation, and money.

Let me give you an example right here in town. Mattress Mack, a great entrepreneur. His sustainable competitive advantage is if you buy today he delivers tonight. Well, that is his marketing. That is the promise he makes. Everybody’s heard that. His operations have to support that. You go to his business, you buy a mattress today, he’s going to deliver it that very day. I assure you he will do that. So as soon as that purchase goes in, someone is loading that on a truck and trying to figure out the logistics of how to get to that to you by the end of the day.

So think about that, how that, that will operate in your business. Use your sustainable competitive advantage to drive your marketing, your operations, and then people, innovation, and money to drive your operations as well.

All right? Thank you. This is Byron Hebert. This has been another quick Tool Time update brought to you by PKF Texas Entrepreneur Playbook. If you’d like to learn more about the Mind Shop Tools and how we can help you in your business, please call PKF Texas.

Karen: This is PKF Texas Entrepreneur’s Playbook, I’m Karen Love, the host and Co-founder. So today I’m here with Frank Landreneau, one of our International Tax Directors and I’d like to welcome Frank back to the Playbook.

Frank: It’s wonderful to be here, thank you Karen.

Karen: Thank you. Well I’m very intrigued by the international business that you live and breathe on a daily basis and I really think the description that you’ve had of this international business lifecycle is completely captivating so can you go into that a little bit more for us?

Frank: Absolutely, I’d love to do that. Well one of the things we’ve found when working with entrepreneurial clients here in Houston, particularly manufacturers and distributors, is that their first step is obviously to gain traction and market share here in the U.S. market. After they’ve been very successful in doing that we find that clients want to do more for their business and that typically means exporting their goods to other markets outside the U.S. They do that for a period of time and then we find that once they’ve gained some traction in particular jurisdictions they will often want to set up a more permanent office in that foreign location. So it does tend to migrate into a lifecycle of business.

Karen: Well and it sounds like you know about those lifecycles and can be of assistance to people in companies that are doing that.

Frank: Exactly. Well for example, one of the things that we do is we help them register in those foreign jurisdictions or set up a company to do business more effectively.

Karen: Wow, so there’s a lot more to it and we need to have you back to hear about that.

Frank: I’d love to do that.

Karen: Thank you; so for other international topics visit PKFTexas.com/internationaldesk. This has been another Thought Leader Production brought to you by the PKF Texas Entrepreneur’s Playbook.

Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, this week’s guest host, and I’m here with Carl Lewis, Olympic Medalist, University of Houston Alum and entrepreneur. Welcome to The Playbook Carl.

Carl: Great, thank you for having me.

Jen: So you have had so much success, you have gold medal, now you’re in business, what do you attribute that success to?

Carl: Well it really goes back to the core of how I was raised. My parents are both teachers; they were involved in the civil rights movement in the 60s and 50s and so they raised us to be independent, to be strong, but also merge all of the facets of your life together to try to have the most success.

Jen: Perfect. And how has that as Olympic Gold Medalist, now an entrepreneur with – what’s your company – Winning Sports?

Carl: Winning Dimensions, that’s one of my companies.

Jen: Winning Dimension Sports, that’s perfect. Now how have your skills as an athlete and former competitor, how has that translated to business?

Carl: The funny thing about it, when I started at University of Houston back in 1979 I knew that I wanted to be Carl Lewis the rest of my life, so therefore everything that I did in school was preparing myself for retirement. So I merged my athletic career, leveraged the success I could have and also the notoriety I could get to do the things that I wanted to do in business. So really it’s all the same and it’s hard work, discipline, structure, planning, presentation – these are all basic principles that you get in sports that you can apply to your business life.

Jen: That’s perfect. Well thank you so much for being with us on The Playbook, I really appreciate it.

Carl: Great, thank you.

Jen: This has been another Thought Leader Production brought to you by PKF Texas The Entrepreneurs Playbook, tune in next week for another chapter.

Starting a new business is an exciting time. But before you even open the doors, you generally have to spend a lot of money. You may have to train workers and pay for rent, utilities, marketing and more.

Entrepreneurs are often unaware that many expenses incurred by start-ups can’t be deducted right away.

How expenses are handled on your tax return

When planning a new enterprise, remember these key points:

  • Start-up costs include those incurred or paid while creating an active trade or business — or investigating the creation or acquisition of one. Organizational costs include the costs of creating a corporation or partnership.
  • Under the federal tax code, taxpayers can elect to deduct up to $5,000 of business start-up and $5,000 of organizational costs. The $5,000 deduction is reduced dollar-for-dollar by the amount by which your total start-up or organizational costs exceed $50,000. Any remaining costs must be amortized over 180 months on a straight-line basis.
  • No deductions or amortization write-offs are allowed until the year when “active conduct” of your new business commences. That usually means the year when the enterprise has all the pieces in place to begin earning revenue. To determine if a taxpayer meets this test, the IRS and courts will generally ask: Did the taxpayer undertake the activity intending to earn a profit? Was the taxpayer regularly and actively involved? Has the activity actually begun?

An important decision

Time may be of the essence if you have start-up expenses that you’d like to deduct this year. You need to decide whether to take the elections described above. Record keeping is important. Contact us about your business start-up plans. We can help with the tax and other aspects of your new venture.

Karen: This is PKF Texas, Entrepreneurs Playbook, and I’m Karen Love hosting cofounder. Today I’m here with Andy Ray, a principal in our entrepreneurial advisor’s services team. Welcome to the Playbook Andy.

Andy: Thank you for having me.

Karen: Well listen, today what I’d love to talk to you about is why do you feel like the mid-market is a great way to affect change?

Andy: Mid-market is a great way to affect change just in the fact that the mid-market has the size to change. They can change very quickly, and just the fact that they’re going through so many cycles of growth from their early days into their scalability phases up through all the way to getting financial help, and getting into that investor ready position. It’s all about change in the mid-market. It’s also a great way to develop people, which is also a change element in and of itself.

Karen: Well those are very interesting points about the mid-market. So tell me what are some of the other challenges you had dealing with mid-market companies.

Andy: The big challenge you have with mid-market companies is that as they do grow they can lose some of that nimbleness, some of that entrepreneurial spirit that they had going through that startup phase.

Karen: Right, because they just get too big to do that.

Andy: They get too big. Secondly, the have trouble sustaining change efforts. They have trouble really cementing the things that make them great as they get through their growth cycles, and then the third problem they have, or the third challenge they have is really retaining, and training talent that they get in the business. It gets to be a very transitory market sized company.

Karen: So without the right consulting that you could provide, I could see why that would be a challenge. Would you come back and talk to us more about that?

Andy: Absolutely, I’d love to.

Karen: Wonderful, well thank you. I appreciate that. Well this has been another thought leader production brought to you by PKF Texas Entrepreneur’s Playbook. So please tune in for another chapter.

Does your company have a sustainable competitive advantage? It should! Byron Hebert, director of Entrepreneurial Advisory Services at PKF Texas, offers another Tool Time Update.

Hi, my name is Byron Hebert, and this is another quick Tool Time update by PKF Entrepreneur Playbook. What I want to talk to you today about is the sustainable competitive advantage and strategic planning.

A lot of people talk about strategic planning but they really don’t know where to start. Where you start is with your sustainable competitive advantage. What is that one thing about your company that separates you from your competition? That’s what you want to focus on. That will drive your marketing; the promise that you’re going to make to the marketplace about what your company can do.

That, in turn, will drive your operations so that you can deliver on the promise you’ve made to the marketplace. Now what drives that? That’s driven by your people, your innovation, and money.

Let me give you an example right here in town. Mattress Mack, a great entrepreneur. His sustainable competitive advantage is if you buy today he delivers tonight. Well, that is his marketing. That is the promise he makes. Everybody’s heard that. His operations have to support that. You go to his business, you buy a mattress today, he’s going to deliver it that very day. I assure you he will do that. So as soon as that purchase goes in, someone is loading that on a truck and trying to figure out the logistics of how to get to that to you by the end of the day.

So think about that, how that, that will operate in your business. Use your sustainable competitive advantage to drive your marketing, your operations, and then people, innovation, and money to drive your operations as well.

All right? Thank you. This is Byron Hebert. This has been another quick Tool Time update brought to you by PKF Texas Entrepreneur Playbook. If you’d like to learn more about the Mind Shop Tools and how we can help you in your business, please call PKF Texas.