Accounting Cleanup & SOP Implementation for Scaling Medical Device Distributor
Built their entire accounting setup from zero, cleaned up the books, systemized commissions, and freed the founder from doing it all manually.
Table of Contents
Table of Contents
The Situation
Sales Flow Running Through a Business With No Accounting System
August Medical was picking up speed. New reps coming on, sales moving, the pipeline growing. From the outside, things looked good. But inside, the accounting was a mess. No QuickBooks, no chart of accounts, no monthly close. Just a founder doing payroll by hand, chasing commission figures across email threads, and hoping the numbers made sense come tax time. The CPA only saw the books once a year, and every year it meant starting from scratch.
Key Situation Factors
The Challenge
The Numbers Existed But None of Them Could Be Trusted
The bigger August Medical got, the more exposed they were. Without a proper accounting system, every decision was based on numbers that couldn’t be fully trusted. Commissions were going out but nothing was properly documented. Payroll was sitting on the founder’s plate personally. And with no monthly close, there was no way to know how the business was actually performing. The risk was not just operational. It was a compliance problem waiting to happen.
Key Risk Factors
- Financial decisions being made on numbers that couldn't be trusted
- Commission disputes with no documentation to fall back on
- Increasing audit exposure as transaction volume grew
- CPA fees climbing due to year-end reconstruction work
- Founder time being consumed by admin instead of sales
- No visibility into actual business performance or profitability
Our Approach
Cleaned the Books, Fixed Payroll, and Built the SOPs
We didn’t just clean up the books. We built the full accounting setup from zero and made sure it could run on its own every single month.
1
Step 1
Set Up the Board Cadence
Locked meeting dates upfront, set a pre-read process one week before every meeting, and defined who owned what across the CEO, CFO, and board chair. Meetings had agendas, minutes, and action-item tracking so nothing fell through the cracks between sessions.
2
Step 2
Put Structure Around the Close and KPIs
Set a weekly leadership meeting rhythm, defined the month-end close window with a hard target of the 15th and no later than the 21st, and built KPI dashboards with named owners across sales, marketing, and finance.
3
Step 3
Built the 13-Week Cash Flow Model
Modeled weekly inflow targets against operating outflows of roughly $197K per week excluding rent and $250K including rent. Rent scenarios, funding needs, and runway were visible in one place and updated on a consistent basis.
4
Step 4
Tied Everything to a Budget and Growth Plan
Pressure-tested unit-level labor costs, revenue targets, and cash break-even assumptions at the location level. Set the FY2026 budget deadline at January 31 with year-end financials due February 15 and assigned clear ownership across the leadership team.
1
Step 1
Set Up QuickBooks and Built a Chart of Accounts
There was no accounting system when we came in. We set up QuickBooks from scratch and built a chart of accounts that matched the way August Medical actually operates, commission revenue, vendor payments, and contractor comp all categorized properly from day one.
2
Step 2
Cleaned Up the History and Established a Monthly Close
We went back through the historical transactions, fixed the misclassifications, reconciled all the accounts, and got everything to a clean starting point. Then we set up a monthly close process so the books were accurate and ready every single month without anyone having to ask.
3
Step 3
Moved Payroll and Commissions Into Gusto
We moved payroll and 1099 processing into Gusto, sorted out contractor classification, and built a straightforward commission tracking workflow. Every payout documented, every rep accounted for, no more chasing figures across email threads
4
Step 4
Put SOPs in Place and Built a Reporting Cadence
We documented the workflows, centralized vendor and commission records, and set up a regular reporting rhythm. The founder stayed informed on what mattered without getting pulled into the day to day.
The Turning Point
When the Monthly Close Ran Without Anyone Chasing It
The CPA opened the books and had no questions. Payroll went out on schedule without a single follow-up. The founder looked at the monthly financials and for the first time had nothing to second-guess. The business had not changed. The financial foundation underneath it finally had.
Quantitative Results
When The Numbers Became Right
1
%
Demo Heading
Of customers recently chose a financial product from a provider other than their main bank.
1
B
Demo Heading
Of revenues at risk between now and 2025 if card-issuing banks are slow to invest in next-gen payment options.
1
%
Demo Heading
The share of US banks’ working hours which could be impacted by technologies like generative AI.
Qualitative Results
Clean Books Changed the Way the Business Operated
Getting the accounting right changed more than just the numbers. The founder had real visibility into how the business was performing for the first time. Commissions were going out on time and every rep knew exactly what to expect. The CPA relationship went from reactive and stressful to straightforward. And with clean, audit-ready books in place, the business was in a much stronger position for whatever comes next, whether that is continued growth or a future transaction.
Key outcomes
- Founder confidence in the financials went up significantly
- Reps had consistent, predictable commission payouts
- Compliance posture improved with a clean audit trail
- Business became more attractive for a potential future transaction
- Founder freed up to focus on sales and growth instead of admin
Testimonial.
"I needed a solution that was
cost effective but high quality and high caliber. So that's where Frack comes into mind.. They take care of what your needs are and they tailor it exactly to what your business requires. You're not just hiring Frack, you're hiring an entire team of experts and you're not just getting this one individual on your team, you're getting our entire network."
Key Takeaways
Key Takeaways
No System Behind the Growth
Real sales momentum with no accounting infrastructure to support or report on it.
The Founder Was Doing It All
Payroll, commissions, and tax prep all managed by one person on top of running the business.
One Close Changed Everything
Moving to a monthly close gave the founder financial visibility they never had before.
When the Books Worked
Clean records meant a smoother CPA, consistent rep payouts, and a founder focused on growth.
Client Profile
Industry
Medical Device Distribution
Company Size
~$1.5M entity revenue / $15–20M gross sales flow
Timeline
Ongoing Engagement
Stage
Scaling
Engagement Type
Accounting Cleanup
Bookkeeping
Payroll & SOP Implementation
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