• Use voicemail creatively. Voicemail isn’t just for taking messages, it can send them too. Changing your outgoing message to include the most frequently asked-for info (what days checks are mailed, deadlines for common forms, etc.) can head off an amazing amount of questions.
• Dedicate different lines for different tasks. If your phone system allows it, set up separate phone lines/voicemail boxes for your different internal and external “customers.” For example, you could direct callers with questions about vendor payments to one line, those looking for T&E reimbursements to another, and employees with questions about payroll or benefits to a third. That way, you can take care of related questions in one swoop, which should save time and mental energy.
• Create a FAQ page for Accounting. If, like most Accounting pros, you get the same few questions over and over, it’s time to create a set list of answers. Posted on the intranet, or even sent as a quarterly “reminder memo,” it’s a quick way to spread need-to-know info that makes everyone‘s life easier.
• Maximize your e-payments software. No matter what software you use to process direct deposits, reimbursements and other payments, make sure you’re taking full advantage of its notification tools. Something as small as being able to e-mail folks that their anticipated payment just got processed can reassure them — and save you from having to handle one more phone call later on.

With the amount of financial info you have to track, a spreadsheet is one of your most potent tools. But the more important (and complicated) a spreadsheet is, the more likely it is to have one of these major flaws. The good news: They’re all fixable. And those fixes can help you work more efficiently in the long run. Here’s what to look out for:

1. Hidden errors. No matter how well — or often — you check, a big complicated spreadsheet is bound to have some errors sneak in over time. And it’ll happen twice as fast if it’s a worksheet that multiple people have access to.  The fix: Periodically use one of the many programs that searches spreadsheets for cells that have missing formulas, broken links, references to empty cells, etc.
2. Too many chefs stirring the pot. There may be good reason for a dozen people to have access to see a spreadsheet — but chances are they don’t all need access to input data. Whenever possible, use Excel’s existing features (such as password-protection) to limit access to “read-only” for key files that need to be shared among many people.
3. Not knowing who did what. Even if access to input data into the worksheet is limited to only two trusted people, there may be times when it’s not clear which version of the spreadsheet is the last one. Make sure you have a system in place to track who made what changes and when. (For larger departments, software is available to handle this. For smaller companies, you may be able to get by with a solid naming/”save as” system.)

Bear in mind: Private letter rulings (PLRs) only apply to the companies seeking them. But they do give you an idea of how IRS looks at certain issues.

In this case, employees sued the company for unpaid leave and vacation time. As part of the settlement, the court ordered the company to pay attorney’s fees for the employees in the suit. According to the PLR, the awarding of attorney’s fees is essentially a reimbursement of an expense. Therefore, it’s not subject to taxes or reporting.

You can the download the PLR here to see all the details.

1. Flex time and work-from-home options. These cost the company nothing, but can mean a lot to employees. Even if your company won’t allow it as a standard work arrangement, try to keep some flexibility in the schedule so that when workers have situations come up (car trouble, ill family member, etc.) they know they can tend to their jobs and their lives.
2. Training opportunities. You don’t have to send staffers to a week-long conference across the country to show that you value them and want to develop their skills. Free or low-cost training close to home is often available via webinars, online classes and the like.
3. Creative perks. Even if employees understand why raises are small or non-existent, it doesn’t mean they’ll like it. Finding other ways to show you appreciate them can help. Look for opportunities to partner with local businesses to find perks that won’t cost you an arm and a leg. For example, a local bakery may be willing to offer a special discount to employees if you provide a discounted service. Or if you can get a group of employees to sign up for a service (like a gym membership), you may be able to negotiate a better deal. If the company picks up part of the remaining cost, it’s that much more valuable to staffers.
4. Pay for what matters. Let employees know that if you get a solid new hire through a staffer’s referral, they’ll be rewarded. It gives them reason to talk up the company to others — which gets them thinking about all the things they do like about the job.

It might be worth revising your company’s travel policy to clarify some common areas of confusion for trips like these, including:

• Which days’ hotel charges are considered reimbursable.
• How to handle any shared expenses when a traveler’s spouse or friend takes part on the trip (Example, a shared meal).
• Whether costs that are spread over the business and personal parts of the trip will be reimbursed proportionally. (Example: If a rental car is used for five days, but only three of those days are business related.)

And as usual, you’ll want to remind travelers to be extra vigilant about documenting the “why, when and where” of their expenses. Later on, if an auditor realizes that a trip was partly business/partly personal, they’re likely to look a lot more closely at those expenses.

You think you have your bases covered for the next audit. But chances are your boss doesn’t have the same faith in you. That’s the learning from a recent survey by Deloitte. The company asked executives to rate their organizations based on how ready they are for audits or other “regulatory investigations.” Only 20% said they thought their troops were “very ready.”

Worse news for Accounting pros: 24% of execs said their companies are at a much greater risk for such an investigation than they were just a year ago. Given the economic climate — and people’s feelings about it — it seems certain that some companies are bound to get more scrutiny in the near future. And coming up short of good answers could lead to not only financial or legal action — it could leave your company with the proverbial egg on its  face.

How to get ready

One bright spot from the survey: 60% of company execs agreed that self-reporting results of internal audits could help identify problems while they’re still fixable and/or mitigate the damage from other investigations.

If you don’t already have self-audits scheduled, now’s the time to get the ball rolling. Even if you’re already sure your procedures and books are as tight as a drum, a successful self-audit can give you two other important benefits:

• proving to upper management that you are ready for the “real” audit, and
• finding errors, cash-drains and other ways to potentially save money down the road.

Tell us: Do you think your company’s ready for an audit or investigation? Is upper management’s skepticism warranted? Sound off in the comments.

IRS has warned its going to start doing random employment tax audits in 2010. It’s aim: To find out exactly how much tax revenue the feds are losing due to employees being misclassified as independent contractors (ICs).

IC classification has always been a gray area — which is why many companies have relied on making an educated guess and then knocking on wood. Without any other red flags, many potentially misclassified employees (and their employers) have flown under the radar.

Random audits could be done at any company — there’s no way to minimize your risk of getting flagged.

What you can do: Go through your hiring procedures now and review the work done by ICs. The first random audits won’t be done until around April 2010, so there’s still time to address any questionable classifications you have on your books.

What tactics have you used to take more control over your time? Share your ideas in the comments.

• New withholding rates. The “Making Work Pay” tax credit will most likely be implemented by having Payroll make two withholding adjustments: one in June of this year, and another at the start of Jan. 2010. (The maximum credit each year is $400 for singles. Because the ’09 credit is effective mid-year, the weekly withholding will have to be re-adjusted in 2010.)
• COBRA coverage/reporting. Employees who are terminated between Sept. 1, 2008 and Dec. 31, 2009 are eligible for lower premiums on their COBRA coverage, starting Feb. 17, 2009. Eligible employees will now pay 35% of the premium. The rest will be paid by the employer — but you can recover the subsidy through a credit on your payroll tax deposits. (Note: The subsidy applies only to former employees whose income is less than $125,000 a year; or family income of under $250,000 a year.)
  That creates a few tasks for Accounting and Benefits pros: You’ll need to contact eligible former employees who rejected COBRA to let them know they are eligible at the new lower rate. You’ll also need to get up to speed on the reporting fast, since the first round is due for 1Q ’09.
• Monitoring COBRA reimbursements from the feds. Related to the point above, if your COBRA premium subsidy is more than your tax deposit, you’ll have to request — and wait for — reimbursement from the feds. So far, there’s no word on how quickly that will be processed.
• Transportation fringe benefits. The new monthly limit on benefits for transit passes and vanpools has been increased to $230 per month, the same as for qualified parking. It’s in effect from March 2009 through December 2010.

In addition to these changes, you can expect employees will be confused about what they’re eligible for, what forms they have to fill out, etc. Be prepared for a slew of e-mails and phone calls. In particular, you may have many more employees who want to update their W-4s due to new tax credits that were tucked into the non-business portions of the law.

Consider putting together a resource you can hand out to answer the questions you’re more likely to hear. Even an e-mail with some links to IRS information releases can go a long way toward reducing how many times your phone rings over the next few weeks.

You can see the entire text of ARRA here.

After all the bickering, Congress finally approved an economic stimulus. So what’s it all mean?

The package that finally passed wasn’t all that different from the original proposal: Some spending was cut, some taxes were lowered, but the main ideas carried through.

Here’s a quick and dirty analysis of the final legislation, focusing on aspects of the law that will affect your company — and those who work for it:

Taxes

• Single filers will get a tax credit of $400, couples get $800, with the credit phasing out for single filers with incomes over $75,000 and couples making more than $150,000.
• State and local sales taxes paid on cars, SUVs and light trucks are exempt from federal taxes.
• Temporary exemption from income taxes for certain unemployment benefits.
• The Alternative Minimum Tax is patched, exempting an estimated 24 million people from having to pay AMT.
• The Earned Income Tax Credit is expanded for families with three or more children, and is restructured to provide relief for the so-called marriage penalty.
• Low income families now qualify for the child tax credit starting once they have income above $3,000.

Workers and unemployment

• Extends through December 2009 a program that gives up to 33 weeks of unemployment benefits.
• Increases weekly unemployment benefits by $25.
• Provides a federal subsidy of 60% to continue workers’ COBRA coverage for up to nine months.
• Provides for $4 billion in job training, as well as another $3.5 billion to provide short-term rental assistance and to buy and fix vacant properties.

In addition, the law calls for increased spending on health care, education, infrastructure, energy and technology that should have long-term benefits for businesses by providing improved efficiency, cleaner energy and better trained workers.

What’s next

Some of the changes to the tax code will take a little time to hammer out the details. For example, the $400 per worker credit will most likely be handled through changing withholding rates. We’ll keep you posted as news comes out.