Welcome to July! The year is half over, and special-event season is in full swing. We have an interesting question this month and can share some valuable information that we learned about July that helped our business year after year.     

Question: We are always looking at ways to improve the operation of our business and we were wondering, what one organizational tip you could share that would help our business?  

Answer: “Each July, conduct a midyear audit of your business.” Those are the words that were shared with us at a PSAI event that we attended after having started our business only a few years prior. We acted upon this advice, and were amazed at how much more efficient — and less stressful — our annual year-end audit became. We adopted this process and used it throughout the time that we owned our business.

Why July?

Here are some of the advantages of taking action now: 

• The year is half over and it is a logical time to compare your actual business results — income and expenses — to your company’s full-year forecast. Do you need to increase the focus on sales? Are there some expenses that need to be trimmed? 
• In terms of accounts receivable, your customers are as busy as you are. Are there any invoices that are past due and may have “slipped through the cracks?” It is better to identify past-due accounts now rather than later.
• From the standpoint of your most important asset — your employees — where is everyone in terms of reviews or vacation and personal days taken versus eligible? By looking at this information now, you can work together to prevent any scheduling conflicts and to avoid any confusion at year end.
• Your company is most likely in the middle of event season, are your supply levels adequate? With all of the focus on events, do you have enough construction units in inventory? As sinks are more and more common on construction sites, do you have an adequate supply for the rest of the event season?
• Review files and filing systems, office supplies, first-aid kits, emergency contact lists, truck annual DOT inspections, computer backups and any other items that you may deem important to inspect. 

Making it work

You might be wondering how to conduct a midyear audit during the busiest time of the year. The best advice is to take it in steps. Do not attempt to do all of this at once, especially during this busy time of the year. We found that setting aside certain days and times during the month increased efficiency and decreased stress.

Here is a hypothetical guide that will allow you to conduct these important tasks while operating your company at maximum efficiency.   

Designate a specific day of the week and time to do this work. Wednesday mornings might be the best for some companies. Typically, Mondays and Tuesdays are busy days in the office and in the field, pickup of the previous week’s event units could be taking place. Thursday generally begins the process of preparing for the weekend’s events and Fridays are usually delivery days for events in addition to the usual daily route services. Perhaps midmorning is a good start time to all for early — and sometimes urgent — calls early Wednesday morning. 

Week One: Accounts receivable and accounts payable review. Review all open invoices and prepare a collection plan.  

Week Two: Physical inventory of equipment in the yard would be an efficient task since most units would be back from the Fourth of July — usually one of the largest event times of the year and generally the following weekend is not as busy.  

Inventory office supplies and supply levels. Inspections can include everything from checking the air conditioning unit for its last inspection date and the date of the last air filter change to inspecting the breakroom refrigerator, microwave and coffee maker to ensure that each is in good order. Safety should always be a company priority, so inspect the first-aid kits to ensure that they are completely stocked and examine all fire extinguishers making sure that the inspection dates are current.   

Week Three: After having contacted your company’s CPA or financial planner in early June and requesting a formal meeting in mid-July for an in-depth discussion and analysis of the first half of the year’s performance, have that meeting.

Vehicle and equipment maintenance review. Ensure that truck maintenance records are current and on schedule as these vehicles are used virtually every day of the week during the busy season. If you have restroom trailers, review these maintenance records also.     

Week Four: Personnel file review. Inspect each employee’s personnel file. When is their next scheduled review? Do they have a service anniversary upcoming that can be recognized? Is their contact information and emergency contact information current? If training or CEU credits are required for their position, are they up to date?

Company files review. Is the company I-9 file current for each employee? (Form I-9 verifies each employee’s identity and work authorization.) Is the company’s annual OSHA 300A Safety Log properly filed away after being publicly posted in the office from Feb. 1 to April 30 each year? Are there any documents in the office that need to be properly filed?

Final thoughts

As PROs we stay very busy, but we need to make time to audit, inspect and analyze our business. We found that a midyear audit is beneficial in all aspects of the business. It helps to eliminate the “we need to get to that sometime” mentality and definitely makes the year-end audit run smoother and more efficiently. Please modify the general examples that we shared to better match the specifics of your business, and then make these midyear evaluations a standard annual practice.