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December 2019

Its almost New Year Have you done your yearly credit report checkup yet While youre at

it protect yourself from charity scams this season by reviewing some big red flags and

learn how to prioritize cash flow in your business

Call if you would like to discuss how this information relates to you If you know someone

who can benefit from this newsletter feel free to send it to them

3 Major Charity ScamRed Flags

This monthDecember 22 - Hanukkah beginsDecember 25 - Christmas DayDecember 26 - Kwanzaa beginsJanuary 15 - 4th Quarter Estimated Payments Due

Yoursquove probably already received several letters andphone calls from charities asking for donationsMost requests are from legitimate organizationsSome however are bogus charities set up by conartists who use the holiday spirit to their financialadvantage

Last year Americans gave nearly $428 billion tocharities according to Giving USA 2019 TheAnnual Report on Philanthropy for the Year 2018Thats a huge incentive for fraud

If youre planning to donate take some time to learnhow to spot a charity scam Here are a few big redflags

Popup charities Every legitimate charitable

association started sometime and some arestill being formed But natural disastersendemics and calamities of every type mdashfrom Hurricane Dorian to the Ebola virus mdashseem to spawn an inordinate share of fakecharities You can avoid these popup scamsby donating to charities that you trust whichgenerally means those with a proven trackrecord If youre unsure check out theorganization with the Better Business BureauCharity Navigator GuideStar or similarwatchdog group Evasive answers to fundraising questions A

legitimate caller should be upfront abouttheir charity the percentage of fundsallocated to administration and marketing

Take final year-end actions - Deductible gifts - Capital gainslosses - Charitable giving - Dividend income

Time for a Yearly Credit Report One way to head off fraud during tax season is to get

your free annual credit report now Credit reports often

have errors in them this quick checkup can be the first

indication that some form of identity theft has taken

place on your account

The good news is that each of the major consumer credit

reporting agencies is required by law to provide you with

a free report once a year Heres contact information to

help you get your free credit report

Annual Credit Reportcom

Telephone 1-877-322-8228

Website wwwAnnualCreditReportcom

Via mail (fill out the online form and mail it to the

following address)

Annual Credit Report Request Service

PO Box 105281

Atlanta GA 30348-5281

Listed here are the three major credit agencies and how

to contact them directly

TransUnion

Telephone 833-395-6938

and what target groups will be aided by yourdonation Whether youre giving to providemedical supplies support research or someother worthy cause dont be afraid to askdirect questions and expect direct answersIf the fundraiser seems to hedge theirresponses or knows little about thesupposed cause to which yourecontributing consider a different charityBeware of vague claims like educating thepublic or promoting awareness

Urgent email requests Websites made to

mimic legitimate charities have conned manyotherwise careful contributors Emails askingfor money on a deadline may originate fromthe backroom computer of a scam artistNever divulge your financial information viaemail Call the charity directly and find out ifits registered in your state (if required) Askfor written information When in doubt checkit out

Many charitable organizations are seeking your aidto address genuine hardships Avoid the schemesof unethical scammers and your donations willprovide help where its needed most

If you think yoursquove been contacted by a boguscharity let the Federal Trade Commission know byfiling a complaint

Save More This ShoppingSeason

This winter the NPD Grouprsquos 2019 Holiday PurchaseIntentions Survey is reporting that Americans plan to spend anaverage of $740 on holiday shopping mdash a 7 increase since

Web site wwwtransunioncom

Via mail 2 Baldwin Place

PO Box 2000

Chester PA 19022

Equifax

Telephone 1-800-685-1111

Web site wwwequifaxcom

Via mail Equifax Credit Information Service

PO Box 740241

Atlanta GA 30374-0241

Experian

Telephone 1888EXPERIAN (397-3742)

Web site wwwexperiancom

Via mail PO Box 9701

Allen TX 75013

Reminder Each agency may try to upsell you into

additional paid services If you find problems on your

credit report work through the credit bureaus process

to correct the error Also place fraud alerts on your credit

agency account if you experience any kind of identity

fraud

Cash Flow A Central Part

of Your Business Plan

When tracking and planning your businessobjections itrsquos easy to focus your analysis on tworeports mdash the income statement and balance sheetBut one of the primary keys to your businessrsquossuccess relies more on how you handle the moneyflowing in and out of the business The appearanceof a solid profit can hide a lurking cash flowproblem

last year The survey also found that more people started theirshopping earlier than last year (even before Black Friday)So are you like your fellow Americans What can you do toensure your spending does not spiral out of control Here aresome ideas

Set a limit Decide what you can afford to spend andstick to it Perhaps you can provide an incentive foryourself with the amount you save under your spendinglimit Better yet Reward yourself with the after-holidays sales Make a list Perhaps Santa got it right when he makesa list and checks it twice Your list can be your workingtool to try to stay on budget Try sorting your list bygroups of people (family extended family colleaguesfriends etc) or by dates you plan on giving gifts Thereare plenty of phone apps that can make this easier Avoid the impulse Yes the sparkly lip balm packsand shaving sets intentionally placed near the checkoutaisles seem like good ideas But you donrsquot need thoseimpulse buys A side benefit of making a list is to tieyour budget to the items on your list This matching ofbudget and list will ensure your spending goal isattainable Compare compare compare See something youlike but yoursquore not convinced by the price tag Goonline and see where you can find it for less Even ifyou dont plan to buy the item online you can shopdifferent retail locations without making the drive If youdo make an online purchase dont forget to factor inshipping costs Consider something other than things If you findyourself buying just to buy because you donrsquot knowwhat to get mdash STOP Consider other gift options thatmay be more meaningful Many people wouldappreciate the gift of time Perhaps its babysitting ordoing yard work for a friend Consider making ahandmade craft or edible goodie The gift of love is toooften replaced by merchandise from a store Save to spend While it may be too late for this yearconsider setting next years budget based on this yearsexperience Then set up a special savings account fornext year and start funding it This can readily reduceyour spending stress next year Cherish giving One of the nicest gifts one can give isto reintroduce the giving nature of the season Considerpurchasing a gift for a charity and then have yourchildgrandchild deliver it This idea can plant the seedfor future generations that consumption should not bethe central theme of the holidays Plus your little onehas the joy of making the holiday season that muchmore special

Here are practices to help you give your cash flowthe attention it deserves

Understand your cash position Start withsimply getting in the habit of monitoring yourbank account activity daily to watch formistakes or unforeseen charges Then lookat each business process that involves cashmdash purchasing inventory collections andpayroll are good examples Considerextending terms for paying vendorsestablishing shorter terms for customers topay and implementing a review process toensure accurate payroll calculations Alsoexplore opportunities to turn over yourinventory faster

Create a cash flow statement forecast Withyour knowledge of cash create a forward-looking statement of monthly cash flow Itwill reflect the ebbs and flow of cashthroughout the year and identify times ofcash crunch You can then see the impact ofchanges you are making on your companyscash position

Identify relevant ratios There are manyhelpful cash flow ratios Identify ratios thatare especially helpful to your business Havedebt Consider the cash flow coverage ratio(operating cash flow divide by debt) to help planfor scheduled debt payments Making a lot ofcapital purchases Use the free cash flowcalculation (operating cash flow ndash capitalexpenditures) to determine how much cashwill be left over after the purchases

Build in some contingencies Mostbusinesses experience seasonalityUnderstanding your business cycles canhelp you strategically manage cash in highcash months to cover shortfalls that come inlow cash months Set up a line of credit soitrsquos available in the case of an emergency oras a bridge during short-term liquidity needsA line of credit only charges interest onlywhen used so itrsquos a perfect tool to have atyour disposal

Watch for hidden cash hijackers Oftentimeslarge cash expenditures can be hidden onyour income statement or balance sheet Afew examples are payments on capitalpurchases debt obligations dividendsguaranteed payments to partners and taxesIncome taxes when not accounted forcorrectly can cause a twofold problem mdash alarge lump sum that is due in a short amountof time plus a larger obligation to accountfor going forward Donrsquot wait until the end ofthe year to project your tax provision

Appoint someone to manage cash As withmany business processes important detailscan fall through the cracks if there is notclear accountability as to who is responsiblefor the task So assign yourself or someoneyou trust to manage the companyrsquos cashflow

When businesses fail itrsquos usually because they runout of money By making cash flow a central part ofyour business plan you greatly reduce this risk

EXCITING COUTO DEFRANCO NEWS

Six consecutive years Nelson Couto and Anthony DeFranco have beenchosen as FIVE STAR Wealth Managers for the sixth consecutive year

Nelson Couto CPA CFPreg and Anthony DeFranco CPA CFPreg MS (Taxation) of Couto DeFranco PA

have been named as 2019 Five Star Wealth Managers and will be featured in the Wall Street Journal

February 27th issue Out of the 6097 wealth managers in New Jersey who were seriously considered for

the award 477 were named This is their sixth time winning this prestigious award Nelson and Anthony

were previous recipients of the award beginning in 2013

We are thrilled to be chosen as a Five Star Wealth Manager by New Jersey Monthly and extremely

proud that the work we have done for our clients has been recognizedrdquo says Anthony DeFranco

Couto and DeFranco are regarded as leaders in the field of wealth management They combine their

knowledge of financial services with over 25 years as CPAs helping their clients with their wealth

management and tax planning needs along with assisting them with their financial goals and aspirations

They believe the best way to help clients reach their financial goals is simple to listen ldquoIt is important to

listen to where they are today and where they want to be tomorrowrdquo says Nelson Couto The partners feel

that clients are paying them for their knowledgemdashboth as NJ Certified Public Accountants and as Certified

Financial Plannertrade professionalsmdashso it is their responsibility to develop a financial strategy that is sound

objective and honest This model has been their secret to success

Nelson Couto and Anthony DeFranco established the NJ CPA firm of Couto DeFranco PA in 1992 and

are located in West Orange NJ The firm serves individuals businesses estates and trusts For more

information on their full suite of accounting wealth management tax preparation and planning services

please call 973-325-3370 or visit the companyrsquos website at httpwwwaccountants-njcom

Copyright copy 2018 Couto DeFranco PA All rights reserved

last year The survey also found that more people started theirshopping earlier than last year (even before Black Friday)So are you like your fellow Americans What can you do toensure your spending does not spiral out of control Here aresome ideas

Set a limit Decide what you can afford to spend andstick to it Perhaps you can provide an incentive foryourself with the amount you save under your spendinglimit Better yet Reward yourself with the after-holidays sales Make a list Perhaps Santa got it right when he makesa list and checks it twice Your list can be your workingtool to try to stay on budget Try sorting your list bygroups of people (family extended family colleaguesfriends etc) or by dates you plan on giving gifts Thereare plenty of phone apps that can make this easier Avoid the impulse Yes the sparkly lip balm packsand shaving sets intentionally placed near the checkoutaisles seem like good ideas But you donrsquot need thoseimpulse buys A side benefit of making a list is to tieyour budget to the items on your list This matching ofbudget and list will ensure your spending goal isattainable Compare compare compare See something youlike but yoursquore not convinced by the price tag Goonline and see where you can find it for less Even ifyou dont plan to buy the item online you can shopdifferent retail locations without making the drive If youdo make an online purchase dont forget to factor inshipping costs Consider something other than things If you findyourself buying just to buy because you donrsquot knowwhat to get mdash STOP Consider other gift options thatmay be more meaningful Many people wouldappreciate the gift of time Perhaps its babysitting ordoing yard work for a friend Consider making ahandmade craft or edible goodie The gift of love is toooften replaced by merchandise from a store Save to spend While it may be too late for this yearconsider setting next years budget based on this yearsexperience Then set up a special savings account fornext year and start funding it This can readily reduceyour spending stress next year Cherish giving One of the nicest gifts one can give isto reintroduce the giving nature of the season Considerpurchasing a gift for a charity and then have yourchildgrandchild deliver it This idea can plant the seedfor future generations that consumption should not bethe central theme of the holidays Plus your little onehas the joy of making the holiday season that muchmore special

Here are practices to help you give your cash flowthe attention it deserves

Understand your cash position Start withsimply getting in the habit of monitoring yourbank account activity daily to watch formistakes or unforeseen charges Then lookat each business process that involves cashmdash purchasing inventory collections andpayroll are good examples Considerextending terms for paying vendorsestablishing shorter terms for customers topay and implementing a review process toensure accurate payroll calculations Alsoexplore opportunities to turn over yourinventory faster

Create a cash flow statement forecast Withyour knowledge of cash create a forward-looking statement of monthly cash flow Itwill reflect the ebbs and flow of cashthroughout the year and identify times ofcash crunch You can then see the impact ofchanges you are making on your companyscash position

Identify relevant ratios There are manyhelpful cash flow ratios Identify ratios thatare especially helpful to your business Havedebt Consider the cash flow coverage ratio(operating cash flow divide by debt) to help planfor scheduled debt payments Making a lot ofcapital purchases Use the free cash flowcalculation (operating cash flow ndash capitalexpenditures) to determine how much cashwill be left over after the purchases

Build in some contingencies Mostbusinesses experience seasonalityUnderstanding your business cycles canhelp you strategically manage cash in highcash months to cover shortfalls that come inlow cash months Set up a line of credit soitrsquos available in the case of an emergency oras a bridge during short-term liquidity needsA line of credit only charges interest onlywhen used so itrsquos a perfect tool to have atyour disposal

Watch for hidden cash hijackers Oftentimeslarge cash expenditures can be hidden onyour income statement or balance sheet Afew examples are payments on capitalpurchases debt obligations dividendsguaranteed payments to partners and taxesIncome taxes when not accounted forcorrectly can cause a twofold problem mdash alarge lump sum that is due in a short amountof time plus a larger obligation to accountfor going forward Donrsquot wait until the end ofthe year to project your tax provision

Appoint someone to manage cash As withmany business processes important detailscan fall through the cracks if there is notclear accountability as to who is responsiblefor the task So assign yourself or someoneyou trust to manage the companyrsquos cashflow

When businesses fail itrsquos usually because they runout of money By making cash flow a central part ofyour business plan you greatly reduce this risk

EXCITING COUTO DEFRANCO NEWS

Six consecutive years Nelson Couto and Anthony DeFranco have beenchosen as FIVE STAR Wealth Managers for the sixth consecutive year

Nelson Couto CPA CFPreg and Anthony DeFranco CPA CFPreg MS (Taxation) of Couto DeFranco PA

have been named as 2019 Five Star Wealth Managers and will be featured in the Wall Street Journal

February 27th issue Out of the 6097 wealth managers in New Jersey who were seriously considered for

the award 477 were named This is their sixth time winning this prestigious award Nelson and Anthony

were previous recipients of the award beginning in 2013

We are thrilled to be chosen as a Five Star Wealth Manager by New Jersey Monthly and extremely

proud that the work we have done for our clients has been recognizedrdquo says Anthony DeFranco

Couto and DeFranco are regarded as leaders in the field of wealth management They combine their

knowledge of financial services with over 25 years as CPAs helping their clients with their wealth

management and tax planning needs along with assisting them with their financial goals and aspirations

They believe the best way to help clients reach their financial goals is simple to listen ldquoIt is important to

listen to where they are today and where they want to be tomorrowrdquo says Nelson Couto The partners feel

that clients are paying them for their knowledgemdashboth as NJ Certified Public Accountants and as Certified

Financial Plannertrade professionalsmdashso it is their responsibility to develop a financial strategy that is sound

objective and honest This model has been their secret to success

Nelson Couto and Anthony DeFranco established the NJ CPA firm of Couto DeFranco PA in 1992 and

are located in West Orange NJ The firm serves individuals businesses estates and trusts For more

information on their full suite of accounting wealth management tax preparation and planning services

please call 973-325-3370 or visit the companyrsquos website at httpwwwaccountants-njcom

Copyright copy 2018 Couto DeFranco PA All rights reserved

Watch for hidden cash hijackers Oftentimeslarge cash expenditures can be hidden onyour income statement or balance sheet Afew examples are payments on capitalpurchases debt obligations dividendsguaranteed payments to partners and taxesIncome taxes when not accounted forcorrectly can cause a twofold problem mdash alarge lump sum that is due in a short amountof time plus a larger obligation to accountfor going forward Donrsquot wait until the end ofthe year to project your tax provision

Appoint someone to manage cash As withmany business processes important detailscan fall through the cracks if there is notclear accountability as to who is responsiblefor the task So assign yourself or someoneyou trust to manage the companyrsquos cashflow

When businesses fail itrsquos usually because they runout of money By making cash flow a central part ofyour business plan you greatly reduce this risk

EXCITING COUTO DEFRANCO NEWS

Six consecutive years Nelson Couto and Anthony DeFranco have beenchosen as FIVE STAR Wealth Managers for the sixth consecutive year

Nelson Couto CPA CFPreg and Anthony DeFranco CPA CFPreg MS (Taxation) of Couto DeFranco PA

have been named as 2019 Five Star Wealth Managers and will be featured in the Wall Street Journal

February 27th issue Out of the 6097 wealth managers in New Jersey who were seriously considered for

the award 477 were named This is their sixth time winning this prestigious award Nelson and Anthony

were previous recipients of the award beginning in 2013

We are thrilled to be chosen as a Five Star Wealth Manager by New Jersey Monthly and extremely

proud that the work we have done for our clients has been recognizedrdquo says Anthony DeFranco

Couto and DeFranco are regarded as leaders in the field of wealth management They combine their

knowledge of financial services with over 25 years as CPAs helping their clients with their wealth

management and tax planning needs along with assisting them with their financial goals and aspirations

They believe the best way to help clients reach their financial goals is simple to listen ldquoIt is important to

listen to where they are today and where they want to be tomorrowrdquo says Nelson Couto The partners feel

that clients are paying them for their knowledgemdashboth as NJ Certified Public Accountants and as Certified

Financial Plannertrade professionalsmdashso it is their responsibility to develop a financial strategy that is sound

objective and honest This model has been their secret to success

Nelson Couto and Anthony DeFranco established the NJ CPA firm of Couto DeFranco PA in 1992 and

are located in West Orange NJ The firm serves individuals businesses estates and trusts For more

information on their full suite of accounting wealth management tax preparation and planning services

please call 973-325-3370 or visit the companyrsquos website at httpwwwaccountants-njcom

Copyright copy 2018 Couto DeFranco PA All rights reserved

Six consecutive years Nelson Couto and Anthony DeFranco have beenchosen as FIVE STAR Wealth Managers for the sixth consecutive year

Nelson Couto CPA CFPreg and Anthony DeFranco CPA CFPreg MS (Taxation) of Couto DeFranco PA

have been named as 2019 Five Star Wealth Managers and will be featured in the Wall Street Journal

February 27th issue Out of the 6097 wealth managers in New Jersey who were seriously considered for

the award 477 were named This is their sixth time winning this prestigious award Nelson and Anthony

were previous recipients of the award beginning in 2013

We are thrilled to be chosen as a Five Star Wealth Manager by New Jersey Monthly and extremely

proud that the work we have done for our clients has been recognizedrdquo says Anthony DeFranco

Couto and DeFranco are regarded as leaders in the field of wealth management They combine their

knowledge of financial services with over 25 years as CPAs helping their clients with their wealth

management and tax planning needs along with assisting them with their financial goals and aspirations

They believe the best way to help clients reach their financial goals is simple to listen ldquoIt is important to

listen to where they are today and where they want to be tomorrowrdquo says Nelson Couto The partners feel

that clients are paying them for their knowledgemdashboth as NJ Certified Public Accountants and as Certified

Financial Plannertrade professionalsmdashso it is their responsibility to develop a financial strategy that is sound

objective and honest This model has been their secret to success

Nelson Couto and Anthony DeFranco established the NJ CPA firm of Couto DeFranco PA in 1992 and

are located in West Orange NJ The firm serves individuals businesses estates and trusts For more

information on their full suite of accounting wealth management tax preparation and planning services

please call 973-325-3370 or visit the companyrsquos website at httpwwwaccountants-njcom

Copyright copy 2018 Couto DeFranco PA All rights reserved

are located in West Orange NJ The firm serves individuals businesses estates and trusts For more

information on their full suite of accounting wealth management tax preparation and planning services

please call 973-325-3370 or visit the companyrsquos website at httpwwwaccountants-njcom

Copyright copy 2018 Couto DeFranco PA All rights reserved