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Case study · Construction
Construction bookkeeping case study: two years behind, IRS and EDD notices, now current and on payroll
A glass shop and construction company in San Jose with six employees and about $2 million a year in revenue changed hands with its books years behind, loans nobody had reconciled, and notices from the IRS and California EDD. Steingard cleaned up the past years in about two months, cleared out the debts the new owner was not responsible for, and now runs biweekly payroll and monthly books. Payroll has not been missed once since.
At a glance
| Client | Glass shop and construction company, 6 employees, about $2M annual revenue |
| Location | San Jose, California |
| Services | Multi-year cleanup · IRS and EDD notice resolution · biweekly payroll · monthly bookkeeping · quarterly filings |
| Software | QuickBooks |
| Working together | More than 1 year |
| Before Steingard | After |
|---|---|
| Books about two years behind, never closed | Every past year cleaned up; books closed monthly |
| Fines, an audit, and IRS and EDD notices | Notices resolved; registrations corrected; quarterly filings on schedule |
| 5 loans, 2 credit cards, 3 bank accounts | 1 bank account, 1 credit card, 1 revolving business loan |
| Loans left over from the previous owner on the books | Removed debts that are no longer the new owner’s responsibility |
| Owner unsure what the business earned | Monthly profit visible in QuickBooks at any time |
The problem
The company came to its new owner with the previous owner’s loans and accounts still on the books, unreconciled. The old bookkeeper had stopped closing anything out, so the books were a couple of years behind.
That gap had consequences. The business was being fined, was under audit, and had a stack of notices from the IRS and the California Employment Development Department (EDD). The owner needed someone to clean up the past and keep payroll and filings current from here on. The company already worked with our team on another project and asked us to take over the books.
What we did
- Multi-year cleanup in about two months. We reconciled the past years and brought every account current.
- Resolved the IRS and EDD notices. We answered the notices, corrected the company’s registrations, and set it up to file quarterly.
- Separated the old owner’s debts. Loans that belonged to the previous owner came off the books, and the accounts were consolidated from 5 loans, 2 cards and 3 bank accounts down to 1 bank account, 1 card and 1 revolving loan we track monthly.
- Biweekly payroll for the crew. We run payroll for all six employees every two weeks.
- Profit by project. Monthly books are kept so the owner can see whether each job made money.
Results
| Measure | Result |
|---|---|
| Cleanup | All past years current in about 2 months |
| IRS and EDD notices | Resolved |
| Accounts to track | 10 down to 3 |
| Payroll runs missed | 0 |
| Quarterly filings | On schedule |
| Relationship | More than a year |
The owner no longer has to wonder whether the numbers are right. When he logs into QuickBooks, the books are current. He can see what the business earned last month, what he can put toward payroll and bonuses, and whether he needs to draw on the credit line for the quarter at all.
Common questions
Can you fix books that are years behind and have IRS or EDD notices?
Yes. For this company we cleaned up about two years of books in roughly two months and resolved its IRS and EDD notices along the way. Cleanup is quoted after a diagnostic review.
Do you run payroll for construction companies?
Yes. We run biweekly payroll for this six-person crew in San Jose and keep the quarterly payroll filings current.
What happens to loans a previous owner left on the books?
We trace each one. Debts that are no longer the business’s responsibility come off the books, so the balance sheet shows only what the current owner actually owes.
Books in the same shape?
Cleanup is quoted after a diagnostic review of your file. Monthly bookkeeping is $199 to $999 a month. See pricing · More case studies