If you’re running a small business, you’ve got a lot on your plate. Couple this with a budget, and you may be struggling to decide what areas and resources in which to invest. But, considering that most small businesses fail because they run out of finances, figuring out your spending strategy should be a top priority. After all, poor financial accounting can ruin you faster than you can say ‘IRS Audit.’ So, if you've asked yourself, ‘ Do I need a CPA?’, consider these factors:
What Services Do You Need?
You should determine what services you would need the Certified Public Accountant (CPA) to provide. Whether it be taxes and payroll, accounts payable and sales invoices, or budgets and financial statements, having a clear vision of your business’ needs is critical to selecting the right financial service. Financial services providers come in many variations. Your business may need a CPA, or maybe you can get by with a bookkeeper or a tax preparer. You may even decide to flex your accounting skills and tackle the challenge yourself. The cost difference between these professionals is quite substantial, and knowing which one is best for the job at hand can save you lots of time and money.
Anyone can learn the basics of accounting. And in the early stages of your business, it might make more sense to manage the financial side yourself. But, as your business grows and becomes more complex, you may start to consider hiring a professional who is well-versed in best practices and finance law. Considering the value of your own time, you should determine whether or not hiring a CPA would be the most cost-efficient move, especially because experienced CPAs can charge hundreds of dollars per hour.
How Big is Your Business?
This is where it can be trickiest to answer the question “Do I need a CPA for my small business?” As your business takes on employees, your finances will, undoubtedly, become more complex. Between payroll, benefits and new office spaces, your business’s finances are unlikely to stay the same as they were in the early days. Constant reviews of your company’s status can help you make the right decision before you get in over your head.
Are You Acquiring Another Business?
While mergers and acquisitions are not typical of small businesses, they do happen and require finance and accounting expertise. If you’re wondering, “Do I need a CPA?”, to handle this acquisition, the answer is most likely ‘yes.’ If you have acquired a business, or you’re in the process of doing so, having a CPA thoroughly review the company’s accounts is critical for a smooth transition. You should know everything about this new business before integrating it with your existing business.
Accounting Boot Camp is passionate about providing mathematical and accounting education to individuals of all ages and skill levels. Whether you are running a small business, or just looking to manage your personal finances, our ebooks offer one of the most entertaining and informational introductions to accounting. For more details on our products and services, contact us by phone at (949) 375-1975 or send us an email. For more interesting conversations similar to ‘Do I Need a CPA?’, check out our blog.