Does the mere thought of seeing your accountant give you anxiety?
Knowing these 8 things you didn’t know should dispel some of that angst.
In addition to being financial historians or tax preparers, your accountant can do much more than you know and can be counted on as a key trusted business advisor.
8 Things Accountants Do That Help Your Business:
1. Launch a start-up. You’ve got a great idea or product, but no notion about how to get things started. Your CPA can help you not only get your bookkeeping set up correctly, but they can help you test your idea, identify your start-up and operating costs, and create credible revenue forecasts.
2. Connect you with lenders. Capital is always top of mind for a business owner. Your CPA has relationships with lenders, has his finger on the pulse of the market, and can help you fill out your loan application and formulate your pitch so that you will be ready to negotiate with your lender.
3. Help you with business strategy. Ready. Aim. Shoot. Without a target, your business is doomed to struggle. Your CPA can help you define your targets or goals – personal, professional, and financial – and then outline a map or strategy for you to meet those goals. You’ll end up with “key performance indicators” (KPIs) that will allow you to clearly see if you’re on track to success or to let you know some adjustments need to be made to ensure actualization of your objectives.
4. Manage cash flow, debt and unpaid invoices. Three headaches that haunt many small business owners are money coming in vs. money going out, good debt or bad debt and slow paying customers or clients. A good accountant will know the ebb and flow of your business and help you organize cash reserves so that you can focus on your business and not worry about how your employees or bills will be paid.
Not all debt is bad, but your CPA will be able to distinguish between good and bad debt, and then help you find strategies to ensure that you carry mostly good debt. And chasing down money owed to you is major energy drain. Systems can be developed so that customers with unpaid invoices are automatically notified via email. If emails are ignored, arrangements can be made for a third party to follow-up with phone calls or purchase the outstanding receivables if they are large enough – and then they’ll chase down the payments and you’ll have money back in your cash flow.
5. Set up a budget. A budget is such an important tool in managing your day to day business. Having accurate knowledge of income and expenses and being able to read your profit and loss statements will save you much madness in the future. Working off of vague numbers and estimates can tank your livelihood in the blink of an eye.
6. Set up your software. Out of the box or on-the-cloud software has limited capabilities to be customized for your business. You accountant will make sure you are set up efficiently and effectively so that automation will save you time and money.
7. Help manage inventory and staff. Whether you are a service industry or have something tangible to sell, a detailed report of time or goods is important to determine your “break-even” threshold. And, if you have staff, your CPA will keep you in compliance with current HR and tax laws.
8. Be an integral part of your business. As an entrepreneur or business owner, you may feel like you are the Lone Ranger in making every decision – financial or otherwise. As a trusted advisor, a good accountant is someone who knows your business, will listen to you with a trained ear and help you unravel even the most complicated issues that may be troubling you.
Today’s accountant is no longer a man wearing a Brooks Brothers suit sitting behind a big desk. Women make up 40% of all CPAs in the U.S. In the 70’s and 80’s, we had the “Big 8 Accounting Firms” which due to acquisitions, mergers, and failures became the “Big 4 Accounting Firms” we know today.
If you are a small business owner, it would be to your advantage to find a small firm that you like, that will give you personal attention, that knows your business, and one that will partner with you in achieving your goals.
Craig Auer, Principal at AuerCPA Co., is a Certified Public Accountant (CPA) and Tax Reform Specialist with over 30 years’ experience helping small business owners focus on their day to day business while he focuses on the fiscal health of their company. AuerCPA Co. is a boutique accounting agency that has a team of professionals who are ready and dedicated to helping small business owners, executives, and small manufacturing plants run their businesses with ease by providing financial guidance for their organizations.