Your business financial are serious business. You want to make sure that you are working with professionals who know what your business needs to remain financially fit and most importantly someone who will help you stay compliant with the IRS.
It’s time to take the stress away! Let’s go through the most important questions to ask an accountant, tax professional, or certified public accountant when seeking financial help.
Accounting is a large industry with numerous specializations. Not every accountant or CPA can perform every duty. That's why it is very important to you focus on specialty areas before hiring an accountant. May want an accountant or CPA who can perform various task such as:
Certain task needed within a business require certain credentials or certifications from governing agencies. For example, In order to have representation before the tax court you will need an enrolled agent certification or must be a tax attorney. Certain financial audit reports about your companies finances require a person who is a certified public accountant.
When you hire someone for any position within your company you want to check that their experience is relevant to the task at hand. This is when you need to investigate if the accountant is experienced with working with small businesses.
Some accountants only have experience working within a corporation; performing duties as an corporate accountant in the employee role and not as an accountant who works with small business owners who file business taxes as a corporation or a small business owner who needs financial maintenance on the small business level.
Most small business operate us the cash accounting method meaning cash is recognized when it is earned. A lot of big corporations operate on accrual based accounting method; thus their revenue and expenses are recorded differently. It's important to ask what is their experience with cash basis accounting.
It is safe to assume that most small business owners are not using an accounting system. They may have purchase QuickBooks and not properly using the system. Or they may simply be comfortable operating and tracking finances and expenses using an excel spreadsheet.
The accountant your hire should be familiar with an accounting system in addition to certain payroll softwares.
It's important to understand how your accountant might treat risky circumstances.
Those are new small business owners tend to have more expenses; most time a lot more expenses than revenue. Some accountant may not be comfortable filing taxes for a start-up business or a business that in an industry that considered high risk. It is important that your accountant is understanding to your circumstance and willing to work with you through all the stages your business will encounter financially.
Another consideration is how risky or conservative will they be when it comes to making day to day decision such as maximizing tax deductions. Are they blurring the lines, overly conservative, or somewhere in between.
You want to pick someone who matches you ideas within reason. Someone who is going to do what is in the best interest for your business while again keeping you compliant and open to be able to obtain resources from financial institutions.
Keiona Wright is a founder of Wright Way. When she’s not serving her clients, she loves to read novels, cut a rug on the dance floor, and play card games with her family . She calls Chicago, Illinois home.
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