Sequoia Integrative Medical Services

Key Performance Indicators

Total Revenue

$5.21M

+$2.13M · +69.2% vs PY

Net Op. Income

$247K

−$480K · −66.1% vs PY

NOI Margin

4.7%

Was 23.6% in FY 2024

Net Income

$221K

−$434K · −66.3% vs PY

Total Payroll Cost

$3.68M

70.6% of revenue

Headcount (EOY)

Was 26 in Jan 2025

Cash on Hand

$108K

~11 days of payroll

Current Ratio

0.31x

Below 1.0x threshold

Benchmark Comparison (MGMA)

Total Overhead / Revenue

95.3%

Benchmark: 60–70% · Gap: +25 pts

Total Labor / Revenue

70.6%

Benchmark: 50–60% · Gap: +10 pts

Support Staff Payroll / Revenue

55.5%

Benchmark: 22–26% · Gap: +29 pts

NOI Margin

4.7%

Benchmark: 15–25% · Gap: −15 pts

Income Statement Variance — FY 2025 vs FY 2024

Line Item	FY 2025	FY 2024	$ Variance	% Variance
Revenue
Sales	$4,991,540	$2,828,162	+$2,163,378	+76.5%
Contract — Miramont	$190,000	$190,650	($650)	−0.3%
Contract — Willow Creek	$55,099	$62,575	($7,476)	−11.9%
Moments Hospice	$32,575	—	+$32,575	New
Refunds	($58,105)	($764)	($57,341)	⚠ +7,507%
Total Revenue	$5,211,109	$3,080,981	+$2,130,128	+69.2%

Expenses
Payroll (Wages + Taxes)	$3,095,869	$1,307,376	+$1,788,493	+136.8%
Guaranteed Payments (All)	$587,451	$262,126	+$325,325	+124.1%
Billing Fees	$496,204	$280,521	+$215,683	+76.9%
Professional Fees	$144,669	$152,445	($7,776)	−5.1%
Employee Benefits	$71,529	$28,059	+$43,470	+154.9%
Travel & Parking	$59,755	$14,094	+$45,661	+324%
Business Insurance	$48,345	$14,637	+$33,708	+230%
Computer & Software	$52,354	$30,282	+$22,072	+72.9%
Continuing Education	$40,000	$2,000	+$38,000	+1,900%
Total Expenses	$4,964,552	$2,354,340	+$2,610,212	+110.8%
Net Operating Income	$246,557	$726,641	($480,084)	−66.1%
Net Income	$221,006	$654,962	($433,956)	−66.3%

Payroll Deep-Dive — FY 2025

Total Gross Pay

$2.89M

55.5% of revenue

Employer Taxes

$226K

7.8% of gross

Total Payroll Cost

$3.12M

Excl. guaranteed payments

Employees (FY 2025)

26 → 48 active

Pay Type Breakdown

Salary

$2.10M · 72.7%

Daily Per Diem

$317K · 11.0%

Regular (Hourly)

$191K · 6.6%

Bonus

$95K · 3.3%

PTO

$18K · 0.6%

Hotel / Travel

$14K · 0.5%

Employee	Gross Pay	Total Cost	Hours	$/Hr	Note
Atkinson, Elizabeth	$186,641	$198,769	2,160	$86
Munoz, Leanna	$163,346	$174,715	2,160	$76
Hagerstrom, Katie	$160,198	$172,666	2,069	$77
Rutten, Allison	$152,338	$163,664	2,160	$71
*Wery, Katelyn	$149,304	$160,916	2,160	$69
Li, Nicole	$110,971	$119,740	167	$667	Per diem — review
Calaway, Teal	$109,433	$118,017	1,243	$88
Banda, Natalie	$79,868	$86,258	130	$614	Per diem — review
DeCero, Haley*	$61,592	—	115	$536	Per diem — review
Top 9 Subtotal	$1,173,691	—	—	—

Month	Gross Pay	Total Cost	Headcount	Cost / Employee
January	$226,687	$248,089	26	$9,542
February	$153,226	$165,894	26	$6,381
March	$152,001	$163,591	26	$6,292
April	$163,062	$175,254	25	$7,010
May	$182,818	$196,869	28	$7,031
June	$194,369	$209,017	31	$6,743
July	$310,521	$334,188	35	$9,548
August	$235,887	$254,046	38	$6,686
September	$245,739	$264,655	41	$6,455
October	$264,561	$284,904	44	$6,475
November	$274,095	$295,010	45	$6,556
December	$487,960	$525,271	48	$10,943
FY 2025 Total	$2,890,926	$3,116,786	52 (unique)	$7,182 avg

Balance Sheet — December 31, 2025

Total Assets

$278K

−$63K vs PY

Total Liabilities

$486K

+$116K vs PY

Total Equity

−$208K

Negative position

Cash

$108K

11 days payroll coverage

Line of Credit

$345K

Was $134K in 2024

Current Ratio

0.31x

Liquidity risk

Category	Dec 31, 2025	Dec 31, 2024	$ Change
Cash & Bank Accounts	$107,759	$150,061	−$42,302
Other Current Assets	$45,381	$47,733	−$2,352
Total Current Assets	$153,140	$197,794	−$44,654
Fixed Assets (net)	$22,969	$41,466	−$18,497
Goodwill & Other Assets	$102,203	$102,203	—
Total Assets	$278,312	$341,463	−$63,151
Credit Cards	$33,197	$31,225	+$1,972
Line of Credit (Nicolet)	$345,120	$134,000	+$211,120
Note Payable — Landmark	$39,903	$47,733	−$7,830
Payroll Tax Liabilities	$68,091	$6,362	+$61,729
Total Liabilities	$486,311	$370,467	+$115,844
Owner Distributions	−$400,000	−$479,560	+$79,560
Net Income	$221,006	$654,962	−$433,956
Total Equity	−$207,999	−$29,004	−$178,995
Total Liabilities + Equity	$278,312 ✓ Balanced	$341,463 ✓	Assets: $278,312 / $341,463

Risk Flags & Management Actions

Critical

Payroll Tax Liability — $68K Outstanding

Federal 941 taxes of $41.7K outstanding. Balance sheet shows $68K total payroll liabilities vs $6K in 2024. IRS delinquency exposure. Confirm current status immediately.

Critical

Distributions Exceed Net Income

Owners distributed $400K against $221K net income — excess of $179K. Equity now −$208K. Unsustainable without capital infusion or earnings recovery.

Critical

Liquidity — 11 Days Payroll Coverage

$108K cash. LOC up 158% to $345K. Current ratio 0.31x. Business operationally dependent on line of credit. No buffer for a payor delay or unexpected expense.

Critical

Headcount Scaled Faster Than Revenue

26 → 48 employees (+85%). Revenue +69%. Payroll-to-revenue: 42% → 70.6%. December payroll alone was $525K — 2x the monthly average. Investigate composition.

Watch

Refund Spike — $764 → $58,105

+7,507% year-over-year. Likely payor clawbacks or billing errors. Needs root cause analysis — could indicate coding or collections issues in Tebra.

Watch

High Per-Diem Provider Costs

Li ($667/hr), Banda ($614/hr), DeCero ($536/hr). Confirm these are tied to billable patient visits. Per-diem costs at $317K (11% of gross payroll) need productivity validation.

Watch

Travel & Parking +324%

$14K → $60K. Partially explained by multi-site expansion. Implement a formal travel policy with pre-approval for amounts above a threshold.

Watch

Continuing Education +1,900%

$2K → $40K. Confirm whether one-time or recurring. If recurring, budget accordingly. If one-time, note as non-recurring in normalized EBITDA.

Positive

Debt Paydown

QBO loan retired ($111K → $0). Landmark note reduced. Interest expense down $30K vs PY. Demonstrates debt discipline alongside growth investment.

Positive

Revenue Diversification

New Moments Hospice stream. Iowa market entry. Multi-site model scaling. Operational leverage should improve once cost structure stabilizes.

Critical

Wery Equity Buy-In Coded to Payroll — $76,568

Dec 23: $46,568 transfer coded as "2% business ownership buy-in." Dec 26: additional $30,000 payroll check to K. Wery. Total: $76,568 in December inflating wages and employer taxes. If equity transaction, must be reclassified — currently distorting labor ratio and NOI by ~$76K.

Watch

Dean Health Clawback — Structured Repayment ($52,701)

$54,331 accrued March 2025 via journal entry. Seven installment payments of $7,529 paid June–December. Repayment on track. Root cause of original overpayment not documented in QBO — confirm with billing team. One installment ($7,529) likely still outstanding in 2026.

Watch

Clarity Health RCM — Billing Vendor Cost Review

Single vendor. $370K billed Jan–Nov 2025 (partial year data). Annualized ~$496K = 9.5% of revenue. Industry benchmark: 5–7% of collections. At current revenue, benchmark rate saves $130–230K annually. Contract renegotiation or RFP recommended.

Transaction Detail Findings — FY 2025

Finding	Amount	Impact	Action Required
Wery equity buy-in coded to payroll Dec 23 transfer + Dec 26 payroll check	$76,568	Overstates wages & labor ratio	Reclassify to equity/distribution account
Dean Health clawback — installment repayment 7 payments × $7,529 · Jun–Dec 2025	$52,701	Explains refund spike; 1 payment ~$7,529 outstanding	Confirm root cause with billing; track final 2026 payment
Clarity Health RCM — billing vendor 8 invoices ranging $37K–$51K	$370K billed (partial year)	9.5% of revenue vs 5–7% benchmark	Contract review / RFP — potential $130–230K annual savings
$125K tax distributions — both owners Apr 11, 2025 — coded as expense to IRS	$250,000	Funded via LOC draw; not operating cash	Confirm tax estimates are current; monitor LOC capacity
QuickBooks loan payoff Jun 16, 2025 — $61,980 to Intuit	$61,924	Eliminates high-cost short-term debt	Positive — no action needed

Monthly Revenue (Sales Deposits) — FY 2025

Month	Revenue	vs Avg ($415K)
January	$333,255	−$82K
February	$351,320	−$64K
March	$458,870	+$44K
April	$418,122	Avg
May	$423,735	Avg
June	$327,797	−$87K
July	$440,844	+$26K
August	$381,550	−$33K
September	$437,960	+$23K
October	$449,966	+$35K
November	$412,134	Avg
December	$558,277	+$143K
FY 2025 Total	$4,993,831	$416K monthly avg

Note: Jan–Feb below average likely reflects prior-year collections lag. June dip warrants review. Dec spike consistent with year-end billing push — confirm not timing shift from Jan 2026.

Quick Normalized NOI — Transaction-Verified Adjustments

Item	Amount	Note
Reported Net Operating Income	$246,557
Add back: Wery equity buy-in (miscoded to wages — Dec 2025)	+$76,568	Dec 23 transfer $46,568 + Dec 26 check $30,000 — reclassify to equity
Add back: Dean Health clawback (one-time structured repayment)	+$54,331	Non-recurring payer repayment — 7 installments Jun–Dec 2025
Transaction-Verified Normalized NOI	$377,456	7.2% margin — see Normalization tab for full QoE bridge

Payroll Tax Reconciliation — Register vs Remittances vs Ledger

✓ Jan–Feb 2026 deposits current · All on time · Mar 23, 2026

941 Balance — Feb 28

$42,787

Per QBO ledger · timing float

WI Tax Balance — Feb 28

$28,976

Normal accrual timing

2026 Deposit Compliance

13/13

All on time ≤5 days

July 2025 Penalty Risk

~$2,675

IRS CP161 — confirm status

Federal 941 — Monthly Recon (FY2025 + Jan–Feb 2026)

Month	941 Accrued	941 Paid	Net	QBO Ledger Balance	Status
Jan 2025	$55,889	$36,763	+$19,126	$19,126	Dec balance carrying fwd
Feb–Jun 2025	$204,320	$211,307	Caught up	$19,192	✓ Current
Jul 2025 ⚠	$78,477	$24,977	+$53,499	$72,692	Late deposit — 3 payrolls bundled
Aug–Sep 2025	$122,836	$118,504	Partial catch-up	$77,023	Catching up
Oct 2025	$67,089	$98,823	−$31,734	$45,289	✓ Catch-up payment cleared
Nov 2025	$69,926	$69,926	$0	$45,289	✓ Current
Dec 2025	$131,023	$89,302	+$41,721	$41,721	Dec 31 payrolls clear Jan 6
Jan 2026	$81,238	$80,335	+$903	$44,996	✓ $2,372 timing float
Feb 2026	$83,828	$86,037	−$2,209	$42,787	✓ On time · float persists
FY2025 Total	$736,611	$649,601	$41,721 BS liability = normal Dec timing

WI Income Tax — Monthly Recon

Month	WI Accrued	WI Paid	Net	QBO Ledger	Status
Jan–Jun 2025	$50,144	$47,463	+$2,681	$1,795	Minor timing variations
Jul–Nov 2025	$63,532	$54,467	+$9,065 carry	$10,361	WI semi-monthly schedule
Dec 2025	$23,649	$13,146	+$10,503	$23,649	Dec 16–31 accrual on BS
Jan 2026	$14,897	$30,743	−$15,846	$28,413	✓ Dec catch-up + Jan payment
Feb 2026	$15,460	$14,897	+$563	$28,976	✓ Normal semi-monthly lag

Jan–Feb 2026 Deposit Log — All Taxes

Date	Tax Type	Amount	Period Covered	Days to Deposit
Jan 2	WI Income Tax	$7,007	Nov 16–Dec 15, 2025	On schedule ✓
Jan 6	Federal 941	$41,721	Dec 31, 2025 balance clearance	6 days ✓
Jan 7	Federal 941	$89	Jan 2 payroll tail	5 days ✓
Jan 15	WI Income Tax	$16,642	Dec 16–31, 2025 catch-up	On schedule ✓
Jan 21	Federal 941	$38,524	Jan 15–16 payroll	5 days ✓
Jan 21	WI Income Tax	$7,093	Jan 1–15, 2026	On schedule ✓
Feb 2	WI Income Tax	$7,093	Jan 1–15 (2nd installment)	On schedule ✓
Feb 2	FUTA (940)	$338	Q4 2025 annual	On time ✓
Feb 2	WI SUI	$1,842	Q4 2025 quarterly	On time ✓
Feb 4	Federal 941	$42,624	Jan 29–30 payroll	5 days ✓
Feb 17	WI Income Tax	$7,804	Jan 16–31, 2026	On schedule ✓
Feb 18	Federal 941	$41,573	Feb 12–13 payroll	5 days ✓
Feb 24	Federal 941	$1,841	IRS direct debit adjustment	N/A ✓
Total Deposited Jan–Feb		$173,191	13 deposits · 100% on time

Open Items & Recommendations

Item	Amount	Priority	Action
July 2025 late deposit — IRS penalty exposure	~$2,675	High	Check EFTPS account history; confirm if CP161 notice received
$2,372 941 ledger float	$2,372	Low	Expected to clear in March 2026 deposit cycle; monitor
WI tax balance $28,976	$28,976	None	Normal semi-monthly accrual timing — no action needed
Deposit compliance going forward	—	Maintain	Add payroll tax deposit schedule to monthly close checklist

Normalized P&L — QoE Ready Adjusted Earnings

Reported P&L — Cash Basis (QBO Source, Unmodified)

Line Item	FY 2025	% Revenue
Sales & Contract Revenue	$5,269,214	101.1%
Refunds	($58,105)	−1.1%
Total Net Revenue	$5,211,109	100.0%
Payroll (Wages + Taxes)	$3,095,869	59.4%
Guaranteed Payments	$587,451	11.3%
Billing Fees (Clarity RCM)	$496,204	9.5%
Professional Fees	$144,669	2.8%
Employee Benefits	$71,529	1.4%
Travel & Parking	$59,755	1.1%
Business Insurance	$48,345	0.9%
Computer & Software	$52,354	1.0%
Continuing Education	$40,000	0.8%
Other Expenses	$268,376	5.2%
Total Expenses	$4,964,552	95.3%
Net Operating Income (Reported)	$246,557	4.7%

Normalization Bridge — Add, Edit, or Remove Adjustments

QoE / Normalized P&L — Three-Column View

Line Item	Reported	Adjustments	Normalized	% Rev

Adjustment Footnotes — Diligence Support

Important Notice: This report has been prepared by HealthcareCFO for the exclusive use of Sequoia Integrative Medical Services management. It is based solely on information provided by management and has not been audited, reviewed, or compiled in accordance with any professional standards. Financial data is presented on a cash basis as extracted from QuickBooks Online. This report is not a substitute for an independent audit, review engagement, or formal quality of earnings analysis. HealthcareCFO makes no representation or warranty as to the accuracy or completeness of the underlying data. This document is confidential and may not be distributed to third parties without the express written consent of HealthcareCFO.