Whether we’re talking ordering, inventory, P&L statements, payroll, tax requirements, or sales totals; if you don’t have the precise numbers to begin with, how can you possibly plan for the future or do damage control for mistakes of the past? Accurate numbers are not only desirable, they are mandatory if you are going to succeed. Hire a good accountant or your numbers will put you in hot water.
A lot of people perceive a good accountant as someone who does the task they are asked to do, in the time that they are asked to do it, and so on. However, a really good accountant does not deliver exactly what is required, they are proactive and take an interest in everything you do as an entrepreneur.
The first thing you should consider is the size of your business. You need to determine first if you will need to hire an accounting firm or an in-house accountant. Small businesses usually do not have the volume of financial transactions that require a full-time accountant or bookkeeper. If you are in a small business, hiring an external accountant or accounting firm on a consulting basis is a good way to start. An external accountant or accounting firm usually handles the following accounting functions:
- Tax return preparation
- Preparing financial statements, including the balance sheet, income statement, and statement of cash
- Analysis or problem-solving advice
When your business grows in revenue, and the financial transactions become more complicated, you should start to consider hiring an in-house accountant. Duties and responsibilities of an in-house accountant usually include:
- General ledger/chart of account maintenance
- Responsibility for daily transactions
- Financial statement preparation and analysis
- Cost accounting and variance analysis
- Treasury and cash management including bank reconciliations
- Payroll and fixed asset accounting
A good accountant delivers added value to their job, like giving proactive financial advice on growing your business or cutting back on specific operational expenses in your business which is costing you more money than necessary. They may even help you determine your Return on Investment (ROI), as well as provide you with ‘benchmarking’ services by giving your business a comparison with other businesses in the same field as yours. In fact, they may even introduce you to their other clients who might be your excellent consultants or mentors who can help you jazz up your business.
A good accountant is reliable in such a way that aside from being able to get the financial matters done, they are always available to advise you on your business’ finances without charging you. Some (not so great) accountants will charge you even for just a two-minute telephone conversation! Choose someone who has the heart and sincerity to work 100% on your behalf. This means that they go out of their way to tell you exactly when your paperwork’s deadline is to avoid any fines and take necessary actions to help you earn tax savings and business growth.
Lastly, choose an accountant whom you are comfortable with, because you will have a ‘relationship’ with them. A personal relationship with your accountant matters, because you are entrusting one of the most delicate components of your business to them—your finances.