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Effective Professional Communication

Effective Professional Communication

You may have had an experience like I had recently. I went to see a medical specialist several weeks ago. While I am not particularly dumb, I did not get as much from the conversation as I could have. Not because I did not care, it was just a world I did not operate in. The terms were unfamiliar, and the significance of the symptoms and the possible solutions were all abstract to me. I was unable to determine which results were most significant. When given a choice of tests to have completed, I did not have the knowledge to identify what was the prudent approach. After leaving the doctor’s appointment, I could have learned more from the appointment and made better-informed choices on how to proceed if he and I were speaking on the same level.

How does this relate to accounting? Like me not being fluent in hematology, sometimes our audience is not fluent in accounting. There can be issues that seem obvious to us as someone who spent years in school and industry that others have not picked up on. It is not enough to share the information. The receiver must understand the implications, the choices, and prudent future action.

As accountants, we need to communicate the significance of numbers, trends, opportunity costs, and ratios so that the user understands the importance of those results. This will enable us to pass the user the insights we have acquired and honed over the years. As an expert in accounting, the transfer of knowledge is only complete when the person receiving understands the significance and impact of critical decision points and the possible risks and benefits we see based on our training and insights.

Communicating financial data to non-accountants or even other accountants who need to become more familiar with the underlying data can be improved by focusing on several aspects of communication.

Tailor Your Communications To Meet The Needs Of Each Client

Tailor To The Users Needs

Users of financial information have different interests and needs for financial information. A banker, an owner, and a project manager have different requirements for financial information. While the underlying data is the same, a presentation should be customized to the recipient’s needs.

A loan officer evaluating a line of credit is going to have a different perspective and needs than an owner who could consider the taxable income effects for the year, which would be different from the project manager, who could need a more detailed understanding of the underlying transactions related to a subset of information related to a company initiative. The underlying data is the same, but the information presented needs to be tailored to the user’s needs.


Minimize Jargon 

For accountants, as with other professionals, jargon is used as shorthand and efficiency in speaking to others familiar with the terms. Concepts like accrual basis, EBITDA, ROI, and gross margin can be unfamiliar terms or intimidating to those outside the accounting profession.

If unsure of the receiver’s knowledge, one is best served to err on the side of less jargon to improve the opportunity for the information to be fully conveyed. Even within the financial profession, different industries can have different jargon or catchphrases that can impede someone’s understanding outside.


Leaders Do Not Want To Appear Unknowledgeable

Leaders may need help to grasp the information being conveyed fully but are unwilling to ask for clarification. Some may not want to appear unknowledgeable or feel they can grasp the concepts without understanding the terms.

Consider the knowledge of the person receiving the information. Are they familiar with the terms being used at a level sufficient to utilize the information being presented? As accountants, we have a significant amount of knowledge and insight. Still, that insight is of value if we can convey that information to others in an understandable format.


Ease Into The Difficult Issues

As accountants, we may present the bad news first. Accountants are generally risk-averse; the most critical item is the negative aspects that must be addressed. Negative trends may be what we want our listeners to focus on, so we start with those topics to make sure they are presented.

For the information receiver, starting with a negative can turn users off from receiving the information.

The person we are presenting to is receiving the information for some reason, such as needing to evaluate their past decisions for adjustments based on changes. Human nature is persons prefer to avoid having their errors pointed out and can tune out critical or uncomfortable information. An approach to minimize the audience tuning out can start and end with positive information. The recipient still receives the required information, but it sandwiches the less favorable issues between news that is easier to receive, thus keeping the receiver engaged.

Be Mindful Of The Curse Of Familiarity

The Curse Of Familiarity

The people we present information to may not be as knowledgeable as us, the experts, with our accounting degrees and backgrounds. As accountants, we may have attended college for several years and passed the CPA exam.

We may have years of experience in the business industry, and we likely have an affinity for numbers. We can look at financial statements and numbers; meanings, causes, and future impacts may jump out to us. That may only be the case for some of our audience who use financial information to make decisions.

Unless the user is managing an accounting practice, it is unlikely accounting is their native language or the reason they went into business. As professionals, we must consider the knowledge base of the person or persons we are working with who are likely less familiar with accounting concepts and the underlying data. They may have other areas of focus which preclude them from being as familiar with the data, trends, and ratios.


Make It Memorable

Individuals outside of the finance department may find numbers boring or insightful. Presenting number after number can cause some users to lose focus.

Conveying information in a story can help users understand, stay engaged and remember. In presenting changes, it can be helpful to remind the user what decisions resulted in the change. What was expected, and what external factors affected meeting or not meeting those expectations?

Numbers, ratios, and trends change over time. A story can often be told to explain the change. The value in those stories can be the key for the information to be understood and retained by the person receiving the information as opposed to presenting this number becoming this other number a year later.

Like a story, a picture can make information memorable. A graph or chart demonstrating trends or changes can turn financial information into a format that can be more easily understood and remembered. This can be especially useful with users who need more fluency in financial data.

As accountants, we can overlook users outside the finance department who may have different education, experiences, talents, and ways of receiving information. It is vital to realize others may need assistance to gain the background to interpret the details, causes, and trends of the information we manage. We are there because of our expertise. If we are not considering our users, we are doing a disservice by not communicating information as effectively as we could to users.

Professionals need to consider how specialized they have become over the years. Things that are intuitive based on our background are not the same places our users are from. Consider your audience when presenting information.

It will help you be more successful in passing along insights and make you a more effective communicator of information to your audience.

Learn More About The Benefits Of Effective Communication

These are just a couple of ways you can help improve your communication skills.

Contact Protea Financial today to see how our communication skills can help your business!

From Vine to Cash Value: Uncorking the Benefits of Cash Value Life Insurance for Wineries and Vineyards

From Vine to Cash Value: Uncorking the Benefits of Cash Value Life Insurance for Wineries and Vineyards

As a partner and Wealth Strategist at Camas Advice, I dedicate much of my time to working with high-earners, high-net-worth individuals, and business owners. I’ve found that in the dynamic business world, smart owners keep an eye on fresh and creative strategies to ensure their growth and success continue. Many tactics are well-known, but there’s a hidden gem that banks and Fortune 500 companies use that most are unaware of: Cash Value Life Insurance. This powerful financial tool benefits businesses in various industries, including wineries and vineyards. These businesses face unique challenges, so their owners need to explore what Cash Value Life Insurance can offer. In this article, we’ll look at why business owners, especially those in the winery and vineyard industry, should learn about Cash Value Life Insurance and how this strategy can boost financial stability, supercharge growth, and create lasting success.

Cash value life insurance is a fantastic tool that can benefit business owners. It can help protect against losing a key person, provide executive benefits, fund your buy-sell agreements, provide financing or line of credit for a business, and even help with estate planning. Wineries and vineyards, just like other businesses, can use these strategies to reach their financial goals.

Let’s take a look at a few examples.


Protecting against the loss of a key person

Losing a key person can be detrimental to any business, and wineries and vineyards are no exception. Cash value life insurance can help protect against financial loss if a key person passes away unexpectedly. For example, if a winery or vineyard owner passes away, their death could significantly impact the business’s revenue and operations. The death benefit from a cash value life insurance policy can help the business recover from the financial loss and continue operating until a suitable replacement is found.

Consider a hypothetical winery, “Sunrise Valley Wines,” as an example of how cash value life insurance can protect against losing a key person. The family-owned winery took out a cash value life insurance policy on its founder, John Smith, to ensure that the business could continue in the event of his unexpected death. This forward-thinking decision demonstrates the value of cash value life insurance in providing a safety net for wineries and vineyards facing the potential loss of a key individual.

Protea Financial Cash Value Insurance for Wineries

Executive benefits

Offering executive benefits can help attract and retain top talent, and cash value life insurance can be attractive. For example, providing key executives with a cash value life insurance policy can be valuable to their compensation package. The policy’s cash value can grow over time, providing a source of retirement income or funding for future business ventures.

Consider a hypothetical winery, “Vineyard Crest,” as an example of how cash value life insurance can be used as an executive benefit. The winery offered its executives a cash value life insurance policy as part of their compensation package, providing a valuable benefit to help retain top talent. This strategy demonstrates the potential of cash value life insurance in creating a competitive edge for businesses looking to secure and maintain the best industry professionals.


Funding a buy-sell agreement

A buy-sell agreement is a legal contract outlining the course of action for a business’s ownership in case of a partner’s death, disability, or departure. Cash value life insurance can effectively fund a buy-sell agreement, supplying the necessary funds to purchase a partner’s shares from their heirs or estate.

Take the hypothetical large vineyard, “Grand Estate Vineyards,” as an example of how cash value life insurance can fund a buy-sell agreement. The vineyard’s partners secured cash value life insurance policies on each other. These policies provide a death benefit in the unfortunate event of a partner’s premature death, and the tax-free death benefit ensures the availability of funds to purchase the deceased partner’s shares. In cases where a partner decides to retire or walk away, the tax-free cash value growth can help with the buy-out, minimizing the financial burden on the business in the event of a loan, payout, or both. This approach showcases the versatility of cash-value life insurance in maintaining business continuity, regardless of whether a partner’s exit is due to death, disability, or departure.


Providing financing for a business

Cash value life insurance can serve as a business financing source, often with more accessibility and flexibility than traditional bank financing. The policy’s cash value can be borrowed against, offering a source of low-interest financing. This can be especially beneficial for businesses needing capital expenditures or investing in new projects.

Consider a hypothetical vineyard, “Rolling Hills Vineyards,” as an example of how cash value life insurance can provide financing. The vineyard’s owners secured a cash value life insurance policy, and as the policy’s cash value grew over time, they could borrow against it. This borrowing strategy enabled the vineyard to access low-interest financing to cover various expenses, such as investing in new vineyards, purchasing equipment, or expanding production facilities.

Using the cash value life insurance policy as collateral, the vineyard could secure a loan with favorable terms, providing the necessary funds for its investments. Moreover, obtaining this financing or line of credit was far more accessible and more streamlined than going through the traditional bank loan process, which often involves rigorous credit checks, extensive paperwork, and a lengthy approval process. This approach illustrates the value of cash value life insurance as a versatile financial tool that can help businesses like vineyards access financing for growth and development with greater ease and convenience.

Protea Financial Insurance for Vineyards

Estate planning

Cash value life insurance can be used as part of an estate planning strategy, providing a tax-efficient way to transfer wealth to future generations while preserving the family business. The policy’s death benefit can be used to pay estate taxes, provide a source of income for heirs, and ensure liquidity so that assets or business interests do not need to be sold.

Consider a hypothetical winery, “Sunset Valley Winery,” as an example of how cash value life insurance can be used as part of an estate planning strategy. The winery’s owners utilized a cash value life insurance policy to help transfer wealth to future generations, offering a tax-efficient method to pass on the family’s assets. The policy’s death benefit provided liquidity, allowing the family to avoid selling valuable assets or business interests to settle estate taxes or other expenses.

Additionally, cash value life insurance can be used to equalize an estate when multiple heirs have different interests in the family business. For instance, one heir may inherit the winery, while the other heir receives the death benefit from the life insurance policy, ensuring that both heirs are treated equitably without dividing or selling the winery. This approach allows the family to preserve their legacy and ensure the continued success of the winery for generations to come, demonstrating the strategic value of cash value life insurance in estate planning for businesses like wineries.



Cash value life insurance can be a game-changing financial instrument for business owners looking to safeguard their company’s future and achieve their long-term financial objectives. As demonstrated by the five examples shared – protecting against the loss of a key person, providing executive benefits, funding a buy-sell agreement, offering financing for your business, and planning for your estate – cash value life insurance delivers many advantages that can cater to various business needs. However, it’s essential to remember that not all life insurance policies or advisors are created equal, and the finer details in policy design are crucial.

As an experienced Wealth Strategist, I am eager to help you explore how your business, winery, or vineyard could benefit from implementing cash value life insurance. Don’t hesitate to contact me for a complimentary consultation and please mention that you discovered my article on the Protea Financial Blog. Together, we can work towards securing a prosperous future for your business.

Learn About the Cash Value Life Insurance Policies Available for Wineries and Vineyards

Read on about the benefits of cash value insurance for wineries and vineyards. Contact Protea Financial today!

Wineries Experience Major Benefits From Cost Segregation

Wineries Experience Major Benefits From Cost Segregation

With the increased popularity of wineries, advancements lead to more tax savings.

Vineyards and wineries have been in existence for thousands of years. Recently, however, they have become more than a center for manufacturing – they have transitioned into a destination for entertainment and tourism. People travel to a location specifically for wine, they host events at vineyards, and consider wineries for social gatherings.

Given this newfound purpose for vineyards and wineries, the physical landscape and buildings have seen some major changes to keep pace. Most locations offer seating and food, event halls, gift shops and more. 

The popularity of vineyards as venues has led to both property and process advancements. Larger facilities are necessary to meet demand, often with commercial kitchens and full bars, meeting rooms and increased parking capacity. The vineyards themselves likely need additional landscaping for the increased demand in product and to maintain the added traffic of tourists. 

Protea Financial Winery Cost

What is Cost Segregation?

Cost segregation is the reclassification of building components into their shortest allowable class lives. This strategy front-loads depreciation expense and offsets tax liability, providing extra cash early into your investment to offset major expenses.

Vineyards and wineries make prime candidates for a cost segregation study due to the multitude of land improvements in addition to buildings on the property. With expanded parking, irrigation, and other specialty equipment for cultivating grapes, the benefit opportunity is quite large. Additionally, the interior of the buildings likely contains specialty lighting and flooring, decorative architecture, and plenty of equipment for manufacturing, processing, hosting and entertaining all of which can be moved into shorter depreciable lives.

If left on the books as straight line depreciation, all major benefits will be lost.

Engineering-based cost segregation studies should always be carried out by an experienced and credible firm. Have a discussion with your CPA. They may already work with an expert in the field and, if not, this is something you can establish together. 

The findings from your cost segregation study will be submitted to the IRS through your CPA alongside your annual business tax returns. Think of a cost segregation study as an add-on to your annual taxes that directly benefits your bottom line.

A cost segregation study involves a multi-step process, including a physical inspection of your property, land, and all related assets. The provider will prepare calculations based on their findings and present them in the form of a report. This report is delivered to the property owner and their tax preparer to be used in computing depreciation expenses. 

It is worth noting that your cost segregation provider should offer complete audit protection in the unlikely event that you find yourself in a position of need.

Protea Financial Vineyard Cost

Why Consider Cost Segregation for your Vineyard or Winery?

Almost all commercial property, and accompanying land improvements, qualifies for cost segregation – but some tend to be better candidates. Wineries and vineyards often yield strong benefits due to the vast amount of property eligible for reclassification, meaning the benefit can be experienced early on. Without this study, many building components and land improvements would otherwise get lumped into straight line depreciation. 

A cost segregation study can be performed on your vineyard when you establish it, purchase it or expand it. If you have owned your property for a few years and have not taken advantage of cost segregation, you can still capitalize on some benefit. We encourage you to reach out to a trusted expert to discuss your current options. 


Where Do I Begin?

This is quite a bit of information and likely not your area of expertise. Understanding taxes, the benefits, the incentives, and the strategies available to you is complex.  You have enough to focus on as it relates to your vineyard. While it may feel overwhelming, the right partner can guide you through the process and ensure that you are maximizing your return. The key is to work with an expert in the field, rather than trying to figure it out for yourself. 

Geraldine Serrano and Kevin Miller, Specialty Tax Consultants with Veritax Advisors, are experienced in tax incentives. They work with vineyards much like yours and understand the industry as it relates to owned assets and taxes. With them and their teams as your trusted advisors, you can rest assured that you are in good hands. The company guarantees excellent results, will defend you in the unlikely case of an audit, and will strictly adhere to all federal and state tax laws regarding real properties. 

For more information or to chat about your property, you can reach out to Geraldine today by sending her an email at geraldine@veritaxadvisors.com or giving her a call at 510.386.0872. You can also reach out to Kevin Miller today by sending him an email at kevin.miller@veritaxadvisors.com or giving him a call at 925.207.3099.

The Many Benefits from Cost Segregation for Wineries

Read our guest post on how wineries can experience significant benefits from cost segregation. Contact Protea Financial to find out more!

American Viticultural Area Valuations Offer Potential Tax Savings for Wineries

American Viticultural Area Valuations Offer Potential Tax Savings for Wineries

Producers and consumers place great value on where their wine grapes are grown. The famous wine-grape producing areas—such as Napa Valley, California, and Walla Walla, Washington— have come to be publicly associated with quality.

However, many wineries are surprised to learn this perceived quality can be quantified and used to offset tax liabilities in the years following a vineyard purchase. The more prestigious the land area, the greater the potential savings.

This complex process includes an American Viticultural Area (AVA) valuation, and the potential tax savings can be significant. Here’s what wineries and vineyard owners need to know about the process to potentially benefit from the savings opportunity.

What’s an AVA Valuation?

An AVA is a geographic area where wine grapes are produced, as defined by the Alcohol and Tobacco Tax and Trade Bureau (TTB). As of June 3, 2020, there are 248 established AVAs in the United States, with 139 in California.

An AVA may have an intangible value associated with the quality of the grapes produced within it. Unlike land, producers may be able to amortize the value of this asset for tax purposes, but doing so requires a valuation to determine the intangible value of the AVA.

Intangible Value

Simply put, the intangible value of a production area results from the perceived value of the wine and wine grapes produced there. This value comes from a number of factors, such as established root stock, weather, soil quality, and consumer preference.

Wineries are only allowed to claim their wine was produced in an AVA if the following conditions are met:

  • 85% of the grapes used to produce it were grown there
  • The wine is registered with the TTB

Grape Pricing Comparison

Prices paid for grapes from different regions can vary dramatically. The graphs below illustrate 2019 bulk grape pricing in California, as reported by the US Department of Agriculture (USDA) for different crush districts.

Grape Pricing Comparison

For example, in the Cabernet Sauvignon grape pricing chart, we can see that in district four—which is Napa County—the median price of Cabernet Sauvignon grapes was approximately $9,000 per ton.

This can be compared to the median of district 10—which includes the Sierra Nevada Foothills counties such as El Dorado and Amador—where the median price for Cabernet grapes was $1,625 per ton.

Potential Tax Benefit

When a buyer purchases a vineyard, the AVA intangible creates a potential tax savings by amortizing the AVA value in the 15 years after the purchase occurs.

If an AVA intangible isn’t measured at the time of a purchase, an AVA valuation can still be performed and the amortization expenses can be retroactively applied to recognized deductions not taken in prior years.


Amortization is the gradual recognition in income of a capital expense over a specific period of time. It’s typically associated with intangible assets—like trademarks—or, in this case, AVAs.

Essentially, it expenses the intangible value of the AVA associated with the land. This option allows vineyard owners to put some of the money they’ve spent to acquire land in a highly desirable AVA back into their businesses.

AVA Valuation Methods

If you purchase a vineyard, you can’t depreciate or amortize the value of the land used to grow the grapes. There’s a distinct separation between the AVA value and the value of the land.

Quantifying the AVA value happens through a complex process known as an AVA valuation. The resulting amount is what vineyards are able to claim for amortization.

There are a few different methods used to determine the potential AVA value.

With and Without

This method involves looking at two scenarios in which vineyards producing the same grapes of similar quality are compared. One vineyard is within a particular AVA, and one isn’t.

By comparing different prices of the grapes produced in each area and the subsequent effect on projected cash flows from the vineyards, the AVA’s intangible value can be calculated.

Relief from Royalty

Estimating a hypothetical avoided royalty or licensing fee is a common way to value tradenames. Distinguishing that a wine is made with grapes from a specific AVA is much the same as marketing that wine with a specific trademark.

While we know AVA designations can’t be licensed, wine brands, as well as brands for other similar products, can be. Comparing the licensing and royalty fees that might be paid by wineries wishing to use different brand names on their packaging offers many insights into the potential value an AVA designation could offer.

Generally, the more profit a winery can produce by licensing a brand, the higher the value of the associated intangible asset.

Vineyard Land Sales

Also known as the market approach, comparing the sale records of different vineyards offers an indirect way to quantify the effects of an AVA designation on land value.

While the price of vineyards can be impacted by many factors, these designations can have a significant impact on comparative vineyard value. The goal is to separate the cost of the land from the value provided by the AVA designation.

Getting Started

With owners making claims about AVA value due to the potentially significant tax savings, the IRS and states are increasing scrutiny on these claims. The larger the claim, the more likely an examination could occur.

Making a well-supported claim should be the ultimate goal. Utilizing multiple valuation methods, providing the appropriate documentation, and working with an advisor with deep industry expertise can help the process move smoothly.

Next Steps

For more information about AVA valuations and how they could help your winery save money, contact an accounting or consulting professional.

Donovan Trone has worked in finance and research since 2009, performing valuations services for operating companies, partnerships, and limited liability corporations for mergers and acquisitions and financial reporting. He can be reached at (408) 558-4320 or donovan.trone@mossadams.com.

Alex Luke has worked in data processing and analysis since 2013. He has extensive experience in data solutions, marketing and business, and valuations analysis. He can be reached at (425) 961-7029 or alex.luke@mossadams.com.

Assurance, tax, and consulting offered through Moss Adams LLP. Investment advisory services offered through Moss Adams Wealth Advisors LLC. Investment banking offered through Moss Adams Capital LLC.