Lynda ArtesaniLegal Accountant and Data Migration Specialist at The Proper Trust

Essential Advice: Always Consult a CPA!

18 Mar 2025 · 1 min

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0:33

In this instructional segment, the speaker emphasizes the importance of directly contacting a client’s Certified Public Accountant (CPA) to verify critical business details. The recommended steps include obtaining the client’s operating agreement, confirming the exact legal structure and incorporation status, and discussing how owner compensation is recorded—specifically whether it should be treated as a draw or payroll. The speaker warns that misclassifying compensation or overlooking incorporation nuances can create conflicts on the balance sheet and profit & loss statement, potentially leading to financial and compliance issues. The overall message is to proactively seek professional CPA guidance to ensure accurate bookkeeping and avoid costly errors.

Chapters

And if you don't know, pick up the phone and call their CPA. Get a copy of their operating agreement, find out how they're really incorporated and what their operating agreement says, and have that conversation. Don't feel like you're alone out there, because if you do it wrong, if they suddenly say they want to change it from a draw scenario on the balance sheet over to a payroll item on the— Balance sheet. on the P&L, and they're not incorporated correctly, that's a conflict.