The Sorcerer's Accountant

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Accounting and Bookkeeping Business Plan

Company Summary

The Sorcerer's Accountant, established in 2006 by Max Greenwood, is a one-person CPA firm which provides tax services, management and cost consulting services, and QuickBooks sales and added services. Sorcerer's Accountant serves small businesses (under $5 million in revenue) in the Chicago, IL area, primarily in service industries. The Sorcerer's Accountant plans to add bookkeeping services to its suite of services to better serve its current and future clients.

Company Ownership

Max Greenwood is founder and 100% owner of The Sorcerer's Accountant, a sole proprietorship.

Company History

Founded with $10,000 of start-up capital by Max Greenwood, CPA in 2006, The Sorcerer's Accountant has become a full-time endeavor for Greenwood. At first focused entirely on tax services, Greenwood added management and cost accounting services in 2007 and then QuickBooks reselling and services to small businesses and startups in 2008, after becoming a certified QuickBooks Pro Advisor. This has allowed Sorcerer's Accountant to provide a wide range of services to small businesses over its lifetime from launch through expansion and growth.

The Sorcerer's Accountant has grown significantly in past years to $175,000 in total annual revenue, but has had difficulty taking on additional work due to the limits on Greenwood's time. Client retention has been a positive factor, with 75% of 2008 clients repeating service in 2009.

The business operates out of a small rented office which has enough room for one additional employee. The office is not used for client meetings - they are held entirely at client offices.

Past Performance
2007 2008 2009
Sales $100,000 $150,000 $175,000
Gross Margin $75,000 $112,500 $131,250
Gross Margin % 75.00% 75.00% 75.00%
Operating Expenses $55,000 $67,500 $82,750
Collection Period (days) 30 25 28
Balance Sheet
2007 2008 2009
Current Assets
Cash $15,000 $17,500 $20,000
Accounts Receivable $4,167 $6,250 $7,292
Other Current Assets $5,000 $5,000 $5,000
Total Current Assets $24,167 $28,750 $32,292
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $24,167 $28,750 $32,292
Current Liabilities
Accounts Payable $4,583 $5,625 $6,896
Current Borrowing $0 $0 $0
Other Current Liabilities (interest free) $0 $0 $0
Total Current Liabilities $4,583 $5,625 $6,896
Long-term Liabilities $0 $0 $0
Total Liabilities $4,583 $5,625 $6,896
Paid-in Capital $10,000 $10,000 $10,000
Retained Earnings ($10,417) ($51,875) ($83,554)
Earnings $20,000 $65,000 $98,950
Total Capital $19,583 $23,125 $25,396
Total Capital and Liabilities $24,167 $28,750 $32,292
Other Inputs
Payment Days 30 30 30
Sales on Credit $50,000 $75,000 $87,500
Receivables Turnover 12.00 12.00 12.00