It’s Mid-Year: Where Is Your Business?

Welcome to Accountants Law Pod, where accounting professionals and law firms converge, hosted by Lynda Artesani, Sarah Prevost, and Steven Libhart.

Welcome back to the podcast, everybody. And, well, this is going to be landing right at our 3-year mark. So we are going to be 3 years old with the podcast, which I guess is kind of rare because if you ever find a podcast you really like and then you start to follow it and then it just stops and you're like, yeah, it's gone. So, uh, yeah. And I think I know Tierra just turned her camera off, but maybe she can turn her camera back on.

Yes, come join us.

Bring her back in and just say, here's the girl behind the camera. Isn't she beautiful? Yes, our producer, our everything for like the topic person and all the social media. Sometimes she's Sarah, sometimes I think she's me. And I don't know, Steve, is she you?

She's Steve when his microphone breaks.

Stuff like that.

Yes.

He's our everything, just so you know.

He's our everything.

He's our everything.

We can't celebrate without you.

It's a lot of, it's a lot of hard work to keep a podcast going for this long.

And yes.

Yeah.

Especially with us, right?

It's like herding cats all the time. Squirrel.

He's very good at herding cats.

Yes.

No, I'm, I'm, I'm really proud. I can't believe that we're already kicking off season 4 and we're already—

That's just amazing.

Well into 1,500 downloads. I think this episode specifically is episode 158.

Wow.

It's just— it feels like yesterday that we started doing this thing. So—

That is so— Here is also our assistant. So she handles like a whole bunch of stuff for us, and nobody can steal her. I'm just gonna put the box around her right now because she's got this job of doing this, and she's like, I, I— oh, sure, I'll do it. And that's how she does things. She just kind of like grabs the bull by the horns and figures it out. And I think she did a great job and finds our people that do our mixing and fixing things.

And yeah, everything's figureoutable at the end of the day.

Yeah. Great. It's a good job at it.

Well, it's, it's an important— I cannot believe it. It's an important journey. And I'm so happy you came back on camera because you're just as important to this whole thing as—

Yes, it wouldn't happen without you. I'm gonna tell you that right now. We would not be sitting here.

Bossing you guys around the whole time.

Yeah, I love it. It's like that ruler.

No, it's been fun. And, and, and I love hearing from members of the Law Lab, or, you know, we, we, we hear from people all the time that I, I listen to the podcast or I watch on YouTube, and it just, it feels so good. And it's, it's wonderful to have such a, a large community around it. And I love telling people that this is what I do, because when they find out that it's a podcast about legal accounting, they're like, What? That's very niche. But for such a, for such a niche podcast, it's wonderful to see it grow.

Yeah, it's awesome.

Yeah, we're grateful for you, T.

I'm grateful for you guys. And so now I'm gonna hop out and we're gonna dive into this week's topic.

We do have a topic. We do. No, I'm kidding.

We do have a topic. It's a little early in the month, but it's something that I think it's good that we discuss it because we want you to all be ready because it's actually You gotta let the month finish to be able to get the year-end review, half mid-year review done. It's mid-year, where's your business? And it's a great topic to discuss. Who wants to start off with, uh, Steve, I'll pick on you.

I was gonna say Steve.

What?

This is right up your alley.

I think it's a, it's, it's the best time of the year because you can breathe a little bit. You can reassess where you're at. You can focus on that to-do list of things that you keep putting off. But, you know, it's that time of year where if you— if your workflow software tracks 1099s, jump in right now and see where your clients are.

Mm-hmm.

You know, start working on that. Look at, um, balancing out, you know, double-checking your payrolls against the, you know, payroll provider or wherever the reports come from. You know, make sure everything ties back. Get on the phone with your clients and check in if you haven't talked to them for a while. See how they're doing, what's going on. Especially this year with, you know, everything's so kind of wackadoodle in the world right now. It's a great time to keep in touch with clients and say, hey, we've— we're already halfway through the year. How are you? What's going on? What do you expect? What are you hearing in your industry? You know, what are you hearing?

They appreciate that too.

Clients really appreciate that. They do.

That you take the time. Because what do we hear from a lot of them when they come to us? And, you know, we're doing the bookkeeping service side.

They're not doing the tax side.

And they come to us like, I don't like my tax person. I never talk to them. All they want is a bunch of papers and they file the tax return. Tell me what I need to pay.

Right, right.

No relationship with them whatsoever. And, you know, I always say to them, well, you know, you're— it's up to you to kind of facilitate that relationship because, yeah, you're talking to them when they're at their busiest and they have this major deadline that they have to meet up to. So it's not always— they have to take a little ownership of it too, you know. When they complain about that.

But it's so weird to think like we just finished through the tax season, the current deadlines. Obviously the extension deadlines are in the future, but how quickly you move through that. You're already into second quarter and you're already thinking, okay, what's my end of year? It's just very— it makes life feel a little bit short, sadly.

It sure does.

In that way.

But it's a good thing that Steve just said about— because, you know, if you're not— if you analyze your payroll and look at the balance sheet, make sure everything is like all the liabilities, because It's fixable, much more fixable to catch whatever's going on now than to wait to—

Right now.

And then you only have a couple of days because then you have to go to payroll correction and stuff. So you want to do that. And also, have you made your estimated tax payments? Because maybe you're rocking and rolling and making a lot of money. Pay it on time by the quarter so that you're not faced with penalties and things like that because you didn't pay it, you know.

Or adjust your payrolls if that's how you're doing it. I mean, make those changes.

Mm-hmm.

I do feel that because part of the way the world is working, there's a lot of changes in software and software companies acquiring other software. So I will say that this feels different this year because I feel like I'm navigating a space of, okay, it's been acquired, it's moved over, now it's the new software. Now we have to go re-sign up, redo all this. It just feels very bumpy right now in a few places that are not normally Like that. Um, but you've got— I, I feel like it's a good time to possibly sort of reevaluate a little bit of like, okay, do the tools I have in my toolbox actually work for me? Uh, am I in a good place to like— do I need to cut some of them loose? Uh, Lynda and I admittedly, we opened up a software, it renewed on us, and we found out that we had at least one person that shouldn't have been on there. Um, I'm communicating thankfully with that.

It seems to be like— and I look back at the year before, it's same month there, and it seems to be a month when all our software annual annual charges.

Kind of hits. Yeah.

Oh, you're right.

I looked, I'm like, holy moly, we paid a lot last year. It wasn't as much as this year, but of course we've grown. But you want to do that. And the, the beauty of this time when it's summer and it's slower, uh, less happening— usually that first week of July is kind of people take vacation— it's a good time to kind of analyze this. Because compared to December when it's holidays and things are happening, and then the year closes on you, then you're stuck. You can't fix things. This way you can look at what you're— what you got coming, what you've done.

Yeah.

And make the changes there. And I was listening to a podcast the other day, and they were talking about AI. And, and I know one thing because we're hearing the vibes of AI now. Do you, do you take and buy in an annual or like we're all in ChatGPT and everybody's saying go over to Anthropic because it's better. You don't wanna be locking yourself into a year into a product that you're not gonna It's not gonna be beneficial or useful to you 6 months from now because it's changing so much.

Yeah.

Yeah. So you wanna look at that too. Okay. Yeah. Yeah. That's something that, and it was scary because so much of the AI is driving this economy now, and it's almost like, I don't know. I'm just, it seems like we're in timing for some kind of a crash. I hate to be Debbie Downer, but you know how it is.

Well, do you wanna know why?

Yeah. Doesn't it feel like, because the stock market's still going up, going up, going up, and I'm like, It can't keep doing that. It kind of goes in 7-year cycles. If you think back on when things bubbled, right? And I gotta think we gotta be close to that right about now.

Well, I heard something encouraging on the news yesterday, I think it was, about AI. They said that AI in the medical field is actually doing better diagnosis than doctors do, but It also said it will never replace doctors because people want the human touch. And I'm like, there you go. Finally, now for the first time, I heard it coming from AI that, you know, people who develop it and all that, that we still need human touch. And I'm like, we— and that's what we bring into this industry. That's what we're doing in this— talking today's—

Have you seen any of the AI that they have in China, what they're doing with, like, the medical stuff that they do where they're not even— there's no human interaction? A lot of it's done Where they put their hand in a machine and it does the blood pressure and everything's like done right. Like they go to these kiosks. It's crazy how they're at this place that we're not at yet.

Mhmm.

But it's almost like you can see where we would go to. I mean, I talked to a doctor that I work out at the gym with, and he told me, he said, I can't— we've been using robotics and things for a long time and computer programs. So I'm looking at it as a computer program. Will it replace the doctor? He said, well, a lot of the surgeries might be able to be performed by the robots. He said, but it's gotta be somebody watching it because robots go wrong. Have you ever had a Roomba? You have had— we've had Roomba, we've had robots in our house. Have you ever seen what Roomba can do sometimes? It doesn't know how to autocorrect and you wouldn't want that operating on you.

Well, you know, this is all such a good point because honestly, I feel like with the mid-year check-in and like, You're— if you're going to utilize tools to say evaluate me, how do you know if it's right or wrong if you're going to use an AI tool to do that? You know, you don't know. It's, it's someone with the experience and the expertise. And I think it's in the similar vein of what you both are saying. It's like at some point that there's compassion and there's an element to human body understanding this and having a logical conversation. Someone in Kosovo Said it really well, and I hope to find the, the piece. Let me see if I can find it. I'll share it with you because I thought it was really important on how they stated the AI being a— it's something like a solution, but not a something else. Let me see if I can find it while we're talking.

You know, with even— because I played around with it a lot this weekend, Steve. I still haven't gotten you to show you what I did. But I know I wanted to show you because I played around with it, and you do have to It's— there's a learning curve to figuring out how to make it work and get you the result you want to get.

Right.

And I was telling Sarah, I was writing articles this weekend and getting ideas of what I wanted the articles for, and it didn't really do a very good job at, at giving me the ideas. But then I said, here, can you write like the base article or write the outline? And one of the articles it wrote for me, I started going through it, and I'm gonna add my own personal touches and stories, and I had it Pretty much write parts of it. And I'm like, oh, I didn't know the software had that in it. It didn't. I went back, I'm like, oh, I didn't even realize that that was a thing inside this software. And then I went into the software and I'm like, there's no report with that name. Like, it made that part up. So if you don't know that and you let AI write your articles, right, you don't pay attention. You have to have the knowledge of what you're doing. Well, you know, to do what you want.

To kind of go into what our subject is today about mid-year review.

Mm-hmm.

We have that personal touch that AI does not have.

Mm-hmm.

You know, and the attorneys can be using AI. They can, you know, they can double-check things that we're doing in AI, whatever they want to do. But we become that most trusted person to them with that personal touch. So, you know, I don't worry about AI taking our jobs. I worry— I'm thankful that it's helping us.

Do you think that AI will— I, I can foresee where AI will probably take a lot of the lawyer jobs away because a lot of it is just even like the tax people's jobs away because it's very regimented to what it is.

It's regimented, right?

So it's black and white and it's certain things are certain things and like documents and filling stuff out and things that normally would be done by maybe a junior attorney done by AI. We take things in.

Yeah.

Put it in there and ask it to, like, summarize, summarize my estate plan and tell me what this says in regular language, because it's, you know, ridiculous how it's written. And then let me know what I should say to the attorney when I go and redo my estates, because it's been 5 years and how— and this is what I'm trying to do. How do I approach the person to do it? And it will walk you through a really good process of having that conversation to keep it. Very tightly spaced. So you're not charged a lot by the attorney. And a lot of it's, you know, you can actually get a pretty good result without even hiring them. I wouldn't do it because ours is a little bit complex and you want it to be, but you can tell it when you're talking to it, has to go by the rules of, for me, the state of Florida. Right. And have it kind of give you suggestions. And then you arm yourself with the information when you go meet with those people. And I think—

It does a lot of the front end thinking for you.

Yes, but you got to make sure it's right because that's the other thing. I mean, and that's— I think too, with mid-year, maybe you can take your data out and pull out your financials and have it analyze that if you want and just say, here's where I'm at, where do you see the weaknesses or where I can improve, and maybe compare me to other law firms. And that's, that's kind of what the AI in QuickBooks is supposed to be doing because QuickBooks can see the data stripped of the names, and it's supposed to help you with their new enterprise suite. It's supposed to help look at the KPIs that way from a perspective of, you know, your law firm's this type of law in the region that you also— there's your competition is here where you should kind of be going. That's the long-term outlook for that, whether that'll ever— I'm sure it will come to fruition. It's just so new. But I've been playing around in that. I don't know if you've changed yours yet to the one that we're gonna all be forced into, the Intuit Enterprise. I changed my Artesani Company just so I could take a look at it. It was not mind-blowing. It looked exactly like what it was, except it's a different color. Like, this banner is different, and it has other buttons in there, which are kind of cool, and I haven't really played around with, but I wanted to see what it was gonna look like. We're gonna be forced into it anyway. It's not like You know, and I didn't go for the extra fancy one. I went for the free one that we're gonna have to switch to, which we're gonna be forced into like in August, I think. Oh, yeah. I'd love to see it.

I wish I, I wish I had the note. Probably had it on my computer. It was just the way that they talked about the digital. They're very digital focused over there in, in, in that speaking engagement I was in. But I'm sorry, I couldn't remember it. If I do, I'll post it later.

I'm beta testing a software right now that I joined, um, after a podcast or after a, uh, I found it online in a Facebook group with Hector Garcia.

Mm-hmm.

And he picked out some people and got us into the beta testing group. And this software takes the books from QuickBooks or from Xero and analyzes them in many different ways and points out things that it thinks that you need to look at and change, consider changing. And if you tweak the books this way, this is what it does, and so on and so forth. Kind of acts like that CFO electronically. And then when it's all done, it makes recommendations on how you, as the most trusted person to that client, can recommend additional services to them. It's way cool, and I've been playing with it, and oh boy, do I like it.

Yeah, but tell her the caveat that you told me about if you do their recommendation.

What I had heard about it is that if you— if it recommends some sort of service that you can go ahead and present to your client and they, um, purchase it or take it on, that the— that this software company gets a certain percentage of the revenue for that add-on service. And that's how they're making their money, which I'm, I'm fine with that. I really am, because—

Huh.

What I've seen so far Is it's really dynamic in what it's thinking and what it's recommending and how it's tweaking. And I took a, I took a set of books for a club that I belong to, and I, I really, I did a whole new file and I messed it all up and took it in there, and it had it cleaned up like in 3 minutes. It was amazing. So I'll give you more information as I play with it because I just joined the beta test on that, and it runs clear up to December.

So Well, I will go back since I did my little intermission. I'll go back to one big thing that's on this list that we have here is setting financial priorities for the rest of the year, which I feel like ties in with the tax planning, the tax estimate planning that Lynda brought up and your partner distributions.

I do.

And evaluating sort of where you are with your next 6 months, I guess you could say. I mean—

Labor cost.

Yeah, the labor costs and, and those things and what's going to be practical. A lot of people, it's hard. I've sat in certain planning sessions where I'm not the tax person naturally, but I'm sitting in the session and I hear, okay, can you forecast the rest of your revenue out? And I think to myself when I'm sitting there, I'm like, can I answer that question honestly? What can I answer? I can answer part of it. Part of it I know is an anomaly. It's just a guess, right? Like, it is.

But we actually did, um, when you were away, we did a, uh, like planning a vision board for your business, which was really cool. And we ended up making it a part 2. So you'll get to come into that, Sarah.

Yeah.

Tierra made a beautiful presentation and we followed that through. We didn't get through the whole thing because we got so involved in like, how do we do this? And how do we do that? How do we, Thinking, and it was really thinking in the short term as well as like maybe a little bit down the road, but it wasn't looking at 5 years. It was really in the short term.

Yeah.

Where do you want to be? And I think that's a good action to do with, with your business because people do it for their life. It's not bad to do for your life either. And sometimes you might want to do that first before you do the business. But it was, it was a really good meeting.

Are you saying in the Law Lab is when you did that?

In the Law Lab. Yeah, we did it in the Law Lab. It was really good.

I mean, Yeah, that's exciting.

There was a lot of excitement there on that.

Yeah, that's exciting.

That was really well received.

Yeah.

Because I think it's something you don't think about doing because we put our head down. I mean, the law firms do it too, right? Our attorneys, they put their heads down and they, they don't— they just work, work, work and grind it out, grind it out, grind it out. They're always working and they don't take a stop and a breath. And this is a great time of the year to do the stop and take a breath and kind of look at the— look at everything from a high level to see what would be where you want to be. And start to think about it and think about personally, and then how that reflects into the business. You know, do you have a child going to college? You know, are they coming into the business or are you retiring? I mean, there's lots of, a lot of, a lot of scenarios that—

A lot of scenarios. Yeah, for sure.

You want to look at it.

You know, it's a good time of the year too if you have projects either in your law firm or in your accounting practice, depending on who you are in the audience. It's a good time of the year to go out and find an apprentice because they take off time from their education in the summer.

Yes.

And you can get an apprentice in that you can help groom and teach and work on your special project. And, you know, so think about that. This is a great time to do that.

That's a great suggestion because I understand it's quite hard, especially in the strategic pieces that they need. And us smaller firms, I think it's a great suggestion. I know Lynda and I've like danced around it a few times, but it's been about bandwidth.

Because you got to train them.

bandwidth, right? Yeah. So, but it's same, it's the same, it's similar. We see a client of ours that does this quite a bit, actually helps, uh, someone groom so he could, you know, maybe have them as an attorney.

So, um, I've worked in firms where that's where we've—

that's where you—

yeah, we've brought in interns and they turn into attorneys and they turn into good ones.

Yeah. So, Steve, one question I was thinking about here in our list is, um, Is the cash flow and how you look at through that cash flow lens of like where you're at and what you need. Kind of like, I think what Lynda, you're saying is like you can project out, you can potentially do that, but also tangibly you need to think about what that cash is because if you're gonna grow or bring on somebody, that's a cash upfront moment. So what does that look like for you?

Exactly. And how many people are putting money in savings right now? You know, with the uncertainty in the economy.

Yeah, yeah.

I read an article this morning when I got up and had coffee that the CEO of Chevron today said that with the Strait of Hormuz and all of that going on right now, he's forecasting that we can end up like the 1970s and have gas rationing again.

Oh, I remember that. That's how I met my first husband.

Yeah, I remember those lines. That's how you met him?

Yep, we had to wait in line to get the gas. Oh yeah. Wow.

That's what they worry about.

But it's a good time of the year to look at your client's financial situation and say, how are you doing? Where are you going? What are you doing with this money? You know, put some, put some, make a nest egg.

Yeah. Yeah.

Get the temperature of what your clients are doing. Are they slowing down? Are they busy? Are they getting busier? A lot of times attorneys either go one direction or the other. In this type of economy, they either really slow down and the other ones get really busy because there's a lot of litigation that goes on.

Yeah, it's different.

Yeah, yeah, yeah. So I feel like we, we did talk about like, so year-end financial performance, uh, we talked about cash flow trends, setting priorities for the rest of the year.

Look at your AR.

Yeah, look at your AR.

I'm sure you look at that all the time. A lot of these things you should be looking at monthly.

Taxes. And, well, some of them quarterly retrospect, right? Planning on taxes and partnership, which goes to setting those financial priorities because those will help you kind of set the, the forward thinking. Um, and then, you know, you might want to at that point, if you have the bandwidth in that project space that you're talking about, Steve, is, uh, what practice areas are successful? If you're engaging in a new one, how has it been? Some people kind of cut things off too fast.

Right.

Give it a little bit more time. So, so yeah, that's in recap, some good highlights to things to think about. So yeah, there you go.

There we go.

Good topic.

If you enjoyed today's episode, please take a moment to like, share, and leave a quick review. And while you're at it, hit subscribe so you never miss an episode. Do you have a question or a topic that you would love us to cover? Drop us a line at info@accountantslawpod.com. Send us a message through our website, accountantslawpod.com, or leave us a comment on any of our socials. Your idea might just make it into a future episode. And if you want to go beyond listening, consider sponsoring an episode and get your company in front of our growing community of accounting and legal professionals who love learning, laughing, and leveling up. And as always, don't forget to join the conversation inside the mastermind group at our Accountants Law Lab. at accountantslollab.com, where collaboration meets inspiration every week.

Well, looks like Chester says we're done. Yeah, he's taking Walter's role.

Yeah, he's trying to get outside. He's been down here.

Oh, look at that.

Yeah.

Are we all done, Chester boo-boo?

Look at the face.

Look at him. Well, thank you for watching.

Thanks, everybody.