Case Study

Comprehensive Bookkeeping, Payroll, and Tax Services for an E-Commerce Company

Challenges Faced

Improperly Closed Books: Previous bookkeepers failed to properly close the books, leading to discrepancies between the books and prior tax returns.

Unreconciled Bank and Credit Card Accounts: Missing transactions in auto bank feeds and improper reconciliation created significant inaccuracies.

Duplicate Sales Entries: Sales posted two to three times due to errors in third-party apps, resulting in millions of duplicate sales invoices.

Incorrect Purchase Invoices: Purchases were posted without considering tax amounts, and inventory items were improperly linked.

Payroll Issues: Payroll wasn’t reconciled with third-party payroll software, as only net pay was considered, ignoring gross pay and payroll taxes.

High Inventory Costs: Inefficient inventory management led to significant financial losses.

Lack of Budgeting: There was no proper budgeting system in place for future planning.

High Accounting Costs with Limited Expertise: The client’s accounting staff incurred high costs but lacked basic accounting knowledge.

Solutions Implemented

Phased Approach for Catch-Up and Cleanup

Divided the workload into phases and set milestones to ensure a quick turnaround.

Learn More About Catch-Up Bookkeeping.

Streamlined Access and Integration

Obtained access to marketplaces, banks, and credit cards to gather accurate data.

Utilized a third-party app to identify and remove duplicate transactions, saving time and costs.

Accurate Posting and Reconciliation

Posted all transactions with inventory in the books.

Conducted a thorough reconciliation of bank and credit card accounts.

Performed random transaction reviews to ensure accurate categorization of income and expenses.

Payroll and Tax Fixes

Resolved payroll discrepancies by including gross pay and payroll taxes.

Corrected opening balance differences and aligned payroll records with W3 forms and 1099K forms.

General Ledger Scrutiny

Conducted detailed reviews of the general ledger to confirm reconciliations and categorization accuracy.

Standard Operating Procedures (SOPs)

Developed SOPs for consistent bookkeeping practices moving forward.

Conducted a collaborative meeting with the CPA to finalize books for tax return purposes.

Advantages of Partnering with OBG Outsourcing

Enhanced Business Growth

Since 2013, we’ve provided ongoing support, enabling the client to expand by launching two new businesses thanks to accurate bookkeeping and financial insights.

Faster Reporting

All books are now completed within five days after month-end, allowing the client to review profitability monthly and plan effectively for new ventures.

Significant Cost Savings

Reduced monthly bookkeeping expenses from $1,200 to $300, providing high-quality services at a fraction of the previous cost.

Improved Financial Clarity

Timely reconciliations and accurate reports empower the client with the financial transparency needed for decision-making.