November 28, 2017

Store, Protect and Access Your Data with Backup and Disaster Recovery Services

Technology has made data an essential part of running a business. From customer information to sales statistics, data is a valuable asset used daily to perform tasks and make informed decisions. Unfortunately, if not properly stored and protected, data can also become a company’s greatest liability.

Limitations of Traditional Backup Services

When faced with an IT equipment failure or security breach, it’s important to have a strong backup service in place. Traditional tape or disk backup systems that simply copy and store your data do not offer companies enough protection and come with limitations, including:

  • If a server issue occurs, data cannot be accessed until after an IT Administrator performs a time-consuming, multi-step data restore process
  • If a server fails and must be replaced, data cannot be accessed until the new server is purchased, delivered and restored with the latest backup
  • Limited storage allows for only a certain number of backups to be archived
  • Backup tapes and disks can be stolen or misplaced
  • If a site disaster occurs, data stored on onsite backups may be lost

Features and Benefits of Backup Services That Include Disaster Recovery

The IT industry has turned to backup and disaster recovery services that ensure data is stored, protected and immediately available in the event of a business disruption. These services offer features and benefits that traditional backup does not, including:

  • If a server issue occurs, data can be restored quickly through a readily accessible restore point
  • If a server fails and must be replaced, immediate access to data is available through a virtual machine hosted on the cloud or locally on an appliance
  • Storage is affordable and scalable
  • Many services offer a time based or unlimited backup archive
  • Data is encrypted and secured during transit to the cloud and while stored in cloud datacenters
  • Many services can detect and/or repair corrupt data
  • Recovery services retain deleted data for a certain amount of time
  • Email alerts can be sent to the IT administrator when backup data is deleted

Successful businesses aim to protect their assets and limit their liabilities. By implementing a virtualized data backup and disaster recovery service, you will be doing both in terms of data. Contact an Anders advisor to learn more about how an industry-leading backup and disaster recovery service can benefit your business.

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November 21, 2017

Anders Startup Client Spotlight on Babyation

Each month, we offer our startup clients the opportunity to share their story and showcase their business in our Startup Newsletter. This month’s featured emerging company is the parent-tech startup, Babyation.

Name and company

Samantha Rudolph of Babyation

When did you start your business?

Although we had the idea in 2014, we officially launched the company in March 2015.

What inspired you to start your business?

My husband and I were on vacation when I read an article that detailed how outdated breast pumps were. Although I wasn’t yet a parent, my future flashed before my eyes, and I didn’t like what I saw. Luckily, I’m married to a very gifted engineer who was able to build something better.

What city are you based in?

We are proudly based in St. Louis, MO.

What is your product or service?

Babyation is a parent-tech company making better products for moms and dads, starting with a discreet breast pump.

What sets your product or service apart from the competition?

Life shouldn’t stop when it’s time to pump. That’s why we’ve created a breast pump that gives you control over when and where you use it.

What is the best business advice you ever received?

For every obstacle, there is a solution: over, under, around, or through.

Is there anything else you would like to share about your business?

We build more than just products—we build confidence. Because every parent should know, “You got this!”

What is your favorite thing to do outside of work?

We love hanging out with our son (and Chief Baby Officer!), Exton.

If people want to learn more about your startup, where should they go? or visit us on Instagram @babyation or on Facebook @getbabyation

Anders Startup Client | Babyation Breast Pump | St Louis Startup

If you would like your startup company to be considered for an Anders Startup Client Spotlight, please complete our questionnaire.

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November 21, 2017

Pitch-Decks: Why a Startup’s Exit Strategy Isn’t About the End

You have spent an unmeasurable amount of time and effort getting your company or idea off the ground. Now you are putting together your pitch, considering what is in store for your future and making your company look as attractive as possible for investors. So why would you even want to be thinking of an exit strategy? It may seem counter-intuitive, but it is actually a very important step to make your company look more desirable to your potential investors.

Exit strategies are for the startup AND investors

The exit strategy for startups is a plan designed for the investors, and not just the founders. Investors are looking to make good investments, and the only way they achieve favorable returns on their investments is if they are able to eventually exit. Even if your company is an all-around successful and growing company, most investors generally don’t want to be in for the long haul; they want the ability to see the return on their investment in a reasonable timeframe.

Common startup exit types

Investors are looking for a company that has a solid exit plan in place. Simply assuming your company will be “bought” in the future just will not suffice. Below are some common ways that investors are able to exit:

  1. The startup is acquired by a larger company
  2. A large institutional investor, such as Series A, Series B, etc., buys out the earlier investors, such as friends, family and angel investors
  3. The startup grows enough to be able to have marketable shares, i.e. IPOs or other private markets
  4. The startup is able to grow enough to buy back the investor’s shares

Other exits are possible, but those mentioned are the most common and perhaps the most desirable.

Determining realistic exit opportunities

Looking at other companies within your industry and benchmarking is a great place to start. Having examples of similar companies being able to exit and to demonstrate the returns their investors received is a solid way to get investors to seriously consider investing in your company. Try to obtain the most specific information you can get on companies in similar industries and turn that information into a realistic projection for your company.

For example: If you are developing a software company, try to find other software companies in your industry that have exited in the past few years. If Google has recently purchased two or three of your competitors, research those exits. Then present your potential investors with the companies that were purchased and for how much. From there, you can calculate a hypothetical return for your potential investors based on the amount of their potential investment compared to the comparable exits.

Presenting exit opportunities can set your pitch apart

If you have not considered an exit strategy for your startup business, don’t feel bad as you are not alone. The State of Owner Readiness Survey of 2015 showed that 49% of businesses, including mature businesses, have considered no exit planning at all and that almost 2/3 of business owners are not familiar with all of their exit options.  Since so many companies have not considered an exit strategy, pitching potential investors on yours is one key way to set your pitch apart from the pack.

Exit plans do not materialize overnight.  Once the plan is in place, it can still take several years to implement, so it is important to start planning now to maximize your business value.  This is what investors are hoping to find while performing their own due diligence on their next investment.

If you have any questions on exit strategies for your business, or how to incorporate them into your next investor pitch, contact an Anders startup advisor.

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November 17, 2017

Luxury Tax Isn’t So Luxurious

When we think of taxes in the sports world, we tend to focus on the individual athlete. Compared to the average Joe, the amount of tax they have to pay is simply astronomical. However, there’s always two sides to every story. Most sports fans have at least heard of the term “salary cap,” and what it means for every team. In the MLB, this same concept is known as a luxury tax. This “competitive balance tax” was established in 1997 and encourages big spending, but costs a premium to keep the game as fair as possible for all organizations.

No Limit on Luxury Tax

A typical salary cap sets a limit on the amount of money an organization can pay to its’ athletes. A luxury tax is slightly different because while a limit exists, teams are still allowed to go over the threshold. The threshold for 2018 is set to be $197 million. A 20% luxury tax must be paid on every dollar that surpasses the threshold. If you’re a second time offender, it increases to 30%. For a third time offender, you must pay 50%. The penalties can add up quickly. Especially when you include a 12% surtax if you are over the threshold by $20-40M. If you surpass the limit by over $40M, the surtax increases to 42.5%. The New York Yankees are no stranger to these taxes considering they have surpassed the threshold ever since 2003, and have paid nearly $325M in luxury tax over that span.

Where the Money Goes

In 2016, a record six different teams paid a combined $74M in luxury tax. This money must be paid to the commissioner by the following January, and is dispersed accordingly. It is used to fund player benefits, the MLB’s Industry Growth Fund, player’s Individual Retirement Accounts, and is split between the teams who did not surpass the luxury tax limit.

An Expensive Future for Giancarlo Stanton

The future of Giancarlo Stanton has been one of the hottest topics this offseason. In 2017, the Miami Marlins outfielder led the league in home runs, hitting 59. Because of his enormous contract, which still has approximately $295M left to be paid, and the rebuilding nature of the Marlins, Stanton is almost certainly going to be on the move. Multiple general managers have said “Stanton wouldn’t be claimed if he were to suddenly be placed on waivers, due to the financial commitment required to sign him.” This massive contract undoubtedly scares a majority of MLB teams due to the salary cap and resulting luxury tax if they exceed the upcoming $197 million payroll threshold.

The San Francisco Giants and St. Louis Cardinals are among the top contenders for landing Stanton this offseason. The Cardinals boast a wide variety of young pitchers available for trade, and have roughly $70M remaining on the payroll before crossing into luxury tax. Those aspects combined with one of the strongest farm systems in the league, the Cardinals can offer an attractive trade package for the Miami slugger. While there are certainly more details involved in major trades, organizations are constantly wary of the luxury tax enforced by the MLB every year.

Learn more about our Sports, Arts & Entertainment Group or contact an Anders advisor to find out how we can help.

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November 13, 2017

Anders Mentors Local Businesses in Metro East Startup Challenge

As a sponsor of the Southern Illinois University Edwardsville Metro East Startup Challenge (MESC), Anders helped coach two local startup companies to second and third place in the competition.

Each of the 15 MESC semi-finalists worked with a group of business mentors and startup advisors on developing their business plan. Joshua L. Snyder, CPA, Anders tax supervisor, worked with Nicole Grimm of Idea Factory Education Services on her business plan from an accounting and tax perspective. Grimm, an SIUE grad, won the second place prize of $6,000 to help grow her business. She hopes to use her teaching background to provide language education services to children and behavior management techniques for parents in early childhood centers in St. Clair County.

Anders tax senior manager Adam S. Prest, CPA worked with mother-daughter team Robyn and Emma Starkey of Harvest Market on accounting tax planning opportunities. Harvest Market won $4,000 in third place. The Starkeys hope to expand their weekend farmers market in Columbia, Illinois into a year-round attraction. They also plan to expand into a local grocer, small deli and eventual community commercial kitchen.

The top three MESC teams presented their winning business concepts at the Leadership Council Southwestern Illinois Board of Directors meeting for over 200 leaders in business, industry, education, government and labor.

View the MESC Announcement video.

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November 7, 2017

Choosing a Health Savings Account (HSA) or Flexible Spending Account (FSA)

There are many factors to take into consideration before choosing a Health Savings Account (HSA) or Flexible Spending Account (FSA). Taking advantage of one of these accounts allows you to deduct out-of-pocket medical expenses. Without an HSA or FSA, generally only the amount that exceeds 10% of adjusted gross income can be deducted by those who itemize.

Health Savings Accounts

Health Savings Accounts (HSAs) can be very advantageous for both individuals and families who purchase their own insurance, and employers and employees. HSAs are designed for individuals to make contributions to the account to then use those funds to pay for qualified medical expenses. HSAs can be opened with a brokerage firm, a bank, or other providers such as insurance companies.

HSA Eligibility

To be eligible for an HSA, you must be enrolled in a high deductible health plan (HDHP). In order for a health care plan to be considered an HDHP it must meet the following requirements:

  • Annual deductible for 2017 is no less than $1,300 for self-only coverage and $2,600 for family coverage
  • The maximum out-of-pocket deductible and other expenses for 2017 is $6,550 for self-coverage and $13,100 for family coverage

The HDHP must also be the only health insurance plan that the individual has. An individual also cannot be claimed as a dependent on another taxpayer’s tax return and cannot be eligible for Medicare.

HSA Benefits and Contributions

HSAs are quite beneficial because individuals can make tax-deductible contributions into an HSA account. You may also have the option of having your contributions taken out of your pay pre-tax. Contributions can be made for any month a HDHP is held during a given year and the contribution amount can be changed at any time.

Contributions made in 2017 are capped at:

  • $3,400 for individuals
  • $6,750 for a family (with an additional $1,000 allowed for those 55 and older)

If the entire amount contributed for a year is not all used in that same year, the unused balance will roll over into future years. HSAs also follow individuals even if they change employment.  Because of these provisions, an HSA can be another vehicle for savings in retirement when your health costs are likely to rise. When money is withdrawn from the account to pay eligible health care costs, contributions and earnings are withdrawn tax-free.

Flexible Spending Accounts

A Flexible Spending Account (FSA) is another option, which is similar to an HSA with a few exceptions. Similar to HSAs, contributions for FSAs are pre-tax and distributions are not taxed.

FSA Eligibility

Unlike HSAs, anyone covered by an employer-sponsored FSA can contribute to the plan. Insurance plans do not need to be considered HDHPs. Contrary to the name, FSAs are not as flexible as HSAs. If changes need to be made for FSA contributions, they must be done at open enrollment time or be completed with a change in family status or employment.

FSA Benefits and Contributions

Contribution limits for FSAs are lower than HSAs. For 2017, FSA contributions are capped at $2,600.

If the entire amount contributed to an FSA for a year is not used within the year (with optional grace period), there is no perk of rolling the funds over to the next year. Any unused balance will be forfeited. Unless an individual is eligible for FSA continuation through COBRA, the FSA will be lost when employment changes.

Qualified Medical Expenses for HSAs and FSAs

Funds distributed from an HSA and FSA can only be used for qualified medical expenses (QMEs).  QMEs include your deductibles, medical expenses not covered by your insurance, prescription drugs, vision, and dental care. Should you take a distribution that is not related to a QME, you will incur a 20% penalty on distribution plus pay the required income taxes on said distribution.

For more information about Health Savings Accounts and Flexible Spending Accounts, please contact an Anders advisor.

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November 7, 2017

Anders Ranks #2 on Accounting Today’s Best Midsized Firms List

Anders is ranked #2 on Accounting Today’s 2017 Best Midsized Firms to Work For list.

Each year, Accounting Today and Best Companies Group select the Best Accounting Firms to Work For in three categories: Small, Midsized and Large. The Midsized group is made up of 52 accounting firms from across the country ranging in size from 50-249 employees.

Moving up four spots in the Midsize group from #6 in 2016, Anders is one of only two St. Louis firms to make the Best Accounting Firms to Work For list in any category. This is the fifth time Anders has been recognized on the Best Accounting Firms to Work For list of 100 top employers in the accounting industry.

Accounting Today’s Best Accounting Firms to Work For survey and awards program is designed to identify, recognize and honor the best employers in the accounting industry, benefiting the industry’s economy, workforce and businesses. Companies from across the United States entered the two-part survey process to determine the Best Accounting Firms to Work for. The first part, worth 25% of the total evaluation, evaluated each nominated company’s workplace policies, practices, philosophy, systems and demographics. The second part, worth 75% of the evaluation, consisted of an employee survey to measure the employee experience. The combined survey scores determined the top companies and the final ranking.

Meet the 2017 Best Midsized Firms to Work For.

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November 6, 2017

Anders Adds Chris Madison to Partner Group

Christopher (Chris) Madison, CPA/CFF will join Anders as a Partner in the Audit and Advisory Services Group on November 15.

Madison, who has 30 years of public accounting experience, specializes in audit and advisory services for single and multi-employer pension and welfare plans. Widely recognized for his knowledge in working with these benefit plans, he is a frequent guest lecturer at industry conferences including the International Foundation of Employee Benefit Plans (IFEBP). In addition to his expertise in serving Taft-Hartley Benefit Plans, Madison also works on financial statement audits for manufacturers and distributors and other closely-held business and professional services firms, not-for-profit organizations and government entities.

“Adding Chris to the Anders team is a strategic step in our growth plan,” said Robert J. Minkler, Jr., managing partner. “We continue to purposefully expand existing service and industry lines and add targeted new ones to increase our reach in the marketplace. Chris’ experience and knowledge in pension and welfare plans, as well as in the niches that align with ours, enrich our position and fit-in seamlessly with our vision for growth.” Minkler added, “Culture is very important to all of us at Anders and Chris shares our vision and values, specifically in serving clients and providing opportunities for young professionals to create a firm of the future.”

Madison is a Certified Public Accountant (CPA) in the State of Missouri, and is Certified in Financial Forensics (CFF). A member of both the American Institute of Certified Public Accountants (AICPA) and Missouri Society of Certified Public Accountants (MOCPA), Madison is also a member of the IFEBP and has served on the Professionals Committee. In the community, he serves as a Board and Executive Committee Member for Angels’ Arms, is a Board Member of the Osage Heritage Association, and was an inaugural Board Member of Kennedy Catholic High School. Madison holds a Bachelor of Science in Business Administration with a concentration in Accounting from Pittsburg State University in Pittsburg.

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November 2, 2017

Business Transition Planning: Achieving Financial Freedom and Peace of Mind

What’s next? Whether you are a new business, one planning to expand or sell, or planning for retirement, you need a sound business strategy. In this recorded video the Anders Business Transition Planning Services Group discusses:

  • The Business Transition Planning Process and Why Business Owners Need It at All
  • Stages of the Business Life Cycle
  • How to Maximize the Value of Your Business
  • Ways to Prepare and Exit Options

Please complete the form below to view the recording.

Learn more about our Business Transition Planning Services.

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