The Right Accountant for Your Small Business is thriving, sales are up, and you’re on course to have a record year. Wonderful news, but what does it all mean for paying taxes? How about defining financial objectives for the upcoming quarter? It’s time to start working with a professional if you’re asking yourself these questions. Small business accountants have the expertise to not only help you navigate tricky forms and hidden deductions but also to give you sound planning and forecasting guidance. Continue reading to learn how to locate a trustworthy small business accountant.
What is Small Business Accounting?
Right Accountant for Your Small Business is thriving, sales are up, and you’re on course to have a record year. Wonderful news, but what does it all mean for paying taxes? How about defining financial objectives for the upcoming quarter? It’s time to start working with a professional if you’re asking yourself these questions. Small business accountants have the expertise to not only help you navigate tricky forms and hidden deductions but also to give you sound planning and forecasting guidance. Continue reading to learn how to locate a trustworthy small business accountant.
Accounting vs. Bookkeeping
Although they are frequently used interchangeably, accounting and bookkeeping are two quite distinct processes. Accounting looks at the bigger picture of a company’s finances, handling tasks like tax preparation and filing, loan applications, and aiding in starting a successful business strategy. Bookkeeping focuses on the day-to-day financial operations of a business, like documenting transactions, balancing accounts, and managing payroll.
What Does a Small Business Accountant Do?
Small business accountants are experts with the experience and understanding to guide owners through their financial records. They are frequently Certified Public Accountants (CPAs). These accountants could work on a monthly, quarterly, or annual basis, depending on the size and requirements of the company. Small businesses frequently enter into agreements with accounting firms or individual accountants who provide the services they require, unlike larger organizations that usually employ accountants.
Tasks Small Business Accountants Handle
To manage daily business accounts, you might already be utilizing a bookkeeper or bookkeeping software. By hiring a small company accountant, you are forming a collaboration with someone who will examine the meaning of all those statistics and provide you with crucial information. Numerous jobs are handled by Right Accountant for Your Small Business, including
- Tax return preparation, filing, and amendments
- Identify eligible tax deductions
- Preparing financial statements, including cash flow statements, income statements, and balance sheets
- Account maintenance and management
- Helping maintain a steady cash flow
- Payroll and fixed asset accounting
- Financial forecasting
- Financial analysis and guidance, with emphasis on potential growth areas
How to Find a Small Business Accountant
It would be difficult to go through all of the thousands of results that a search for a “small business accountant” would provide. Ask other small business owners who they use and trust with their finances as a starting point for crowdsourcing. Once you have a few names, look them up online to learn more about their background and experience, and read any reviews that might be available.
The National Association of State Boards of Accountancy and the American Institute of CPAs both have directories that permit users to search by state and region.
Reputable small business accountants and accounting firms shouldn’t have any trouble scheduling an initial consultation to discuss your requirements and provide references.
Must-Haves when Choosing an Accountant
You must first decide which tasks an accountant will help you with and how frequently you will need their assistance. Make a list of your top priorities first, including issues that require immediate attention and those that must be resolved over the next six months. The next decision is whether you want to hire a freelance accountant or a big accounting business. Whichever you choose, be sure the person you choose is someone with whom you feel comfortable sharing sensitive information. This person should have a lot of experience working with the kind of small business you have.
Accounting Firm, Contractor, or Employee?
The majority of small enterprises don’t require an accounting specialist. It may be alluring to have a team member who handles all financial matters. However, keep in mind that you would also be responsible for paying their salary and benefits. Generally, you will have two major options: an accounting business or a freelance accountant you hire.
Plan interviews with both to get a sense of how they operate if you’re unsure which option is better. Consider your needs in terms of specific services, your budget, and the following factors before making a decision:
- Costs incurred both initially and over time by an accountant or accounting firm
- Their availability and office hours
- Their prior working relationships with companies like yours
- Their communication methods
- Can they represent you before the IRS in the event of an audit?
- Will you always collaborate with the same person?
Red Flags to Watch
Sadly, there are accountants out there that look perfect on paper but aren’t really what they seem to be. Although it’s never a smart idea, questionable accounting can be disastrous for small firms. You must use extreme caution to avoid dealing with the wrong individual, which includes conducting a background check, asking for references, and conducting an interview. Additionally, you should monitor your accounting procedures closely for any warning signs, such as
- An accountant who advises against retaining receipts
- Being prompted to sign checks or paperwork without understanding their purpose
- Get a service estimate before your tax refund has been determined
- Communication drops off or stops completely
Best Small Business Accounting Software
Consider doing your accounting if your Right Accountant for Your Small Business doesn’t generate mountains of paperwork and bins full of receipts. There are many high-quality, reasonably-priced software alternatives available, and we’ve researched them to find the most suitable options for you. To choose one that will meet your needs, look through our reviews of the Best Accounting Software.
Hiring a small business accountant will cost you money, but you will ultimately save a lot of money if you do. You are probably missing out on deductions and other small business perks unless you are a CPA who is knowledgeable about tax laws. And if your company expands, you probably won’t have the time or expertise to effectively manage all of your books.
Starting with some dependable accounting software and a sound organization system will probably be enough to keep you afloat for a while. This is especially true if you are just starting out in business. This is if you don’t have any workers. As soon as growth picks up, don’t put off obtaining a trustworthy accountant who will look out for your business interests.