Do you need an accountant? How will an accountant help your business grow? How do you decide to work with an accountant?
The roles of an accountant vs bookkeeper
A bookkeeper works with accuracy and efficiency on a company’s payroll, invoices, creditors and debtors, general ledgers, and other financial activity. Bookkeepers have a basic level of financial education although their role within a business is often irreplaceable.
In contrast to the bookkeeper, the accountant is more specialized in finances and tax since they are required to have both a financial degree and experience. An accountant goes beyond the bookkeeping understanding of finances by providing businesses with key performance indicators (KPI’s), balance sheets, statements on profits and losses, cash flow, and balance sheet. This information gives a business owner a broader, deeper understanding of company finances and growth.
How an accountant can help your business
Besides assisting you with tax, audits, and financial tracking, accountants can assist you develop a business plan that is professional, realistic, and a higher chance for success. This business plan will be based on your current finances and goals.
As a business owner,you will need to decide on the type of business you would like to be registered as, a sole proprietor, corporations, etc. An accountant will be able to explain each option to you and recommend the option best suited to your style of business and business needs.
Deciding to contact an accountant
When it comes to hiring an accountant for assistance with your business finances, a cost benefit analysis can help make this important decision. As a business owner, you should look objectively at the cost of hiring an accountant versus you or one of your current staff taking over the company books. Is the cost versus your time spent worth it?
As a business owner what are your strengths? If you enjoy the process of keeping track of company finances and should these finances be manageable, it may be best not to hire an accountant for now. However, if basic bookkeeping is not your strength and your time is better used elsewhere that will generate more profitability; an accountant will be a benefit to your company.
Hire, consult or outsource?
Once you have decided your company will benefit from the skills of an accountant and/or bookkeeper, your next decision may be between hiring an in-house accountant, consulting with an accountant for a certain period of time, or outsourcing.
When hiring an accountant ask yourself if your business finances can afford another salary on your payroll. Should you prefer to consult or outsource you would need to obtain quotes from an accountant firm on the relevant costs involved, scope of work covered, and time duration.