You wear many hats as a small business owner. Among other things, you must maintain general expertise in your industry, know how to run daily operations efficiently, determine beneficial business strategies, build your customer base, and ensure the revenue keeps flowing in. In other words, you probably don’t have much spare time on your hands. And since finances are such a vital part of your business, hiring professional accounting services can prove a worthwhile investment. Penmark has provided some information and advice about why every small business owner should work with a CPA.
Gaining Financial Insight
The state licenses Certified Public Accountants (CPAs) to guarantee that they keep up with state and federal regulations. They also understand how to guide you through a wide range of financial issues. A competent CPA can look at the whole of your company’s finances (e.g., credits, debits, profits, losses, etc.) and provide you with deep insight into maintaining or improving your resources.
Establishing an Accounting System
Having an efficient accounting system in place is critical for your small business. The latest software allows you to create reports and statements quickly, organize your files, and access your financial information. A CPA can help you choose the right software and teach you how to operate it.
Keeping Up with Payroll
If you’re still in the planning phase of launching a business, you should definitely work on establishing payroll for your startup. An efficient payroll system helps you issue paychecks to employees on time, file taxes, and comply with regulatory laws. To set up payroll, figure out how often you’ll be paying your employees, issue Form W-4 to new hires, keep IRS deadlines in mind, and compile payroll information. Since handling payroll can be tedious, you can hand the task over to a CPA, who will make sure you meet all of your payroll tax obligations and advise you every step of the way.
Creating Financial Statements
Every business needs complete financial statements for banks, creditors, and investors. CPAs are trained to create these statements in a way that complies with the Generally Accepted Accounting Principles (GAAP). Along with preparing financial statements, a CPA can review them and help you understand them — this information can help you make sound decisions going forward.
Handling Taxes
Nothing can get you in legal hot water as fast as tax problems, and business taxes are pretty complex. Fortunately, CPAs cannot earn or maintain their license unless they are well-versed in the most current tax law. They can also verify that you are complying with the IRS (and tell you how to fix it if you aren’t), which can prevent a slew of costly tax issues.
Furthermore, CPAs know a lot about tax planning and can help you ethically minimize tax liability. And if you’re like most business owners and are overwhelmed each tax season, your CPA can handle the bulk of your tax filing process. Ensuring that you file all the proper paperwork and information on time, CPAs can help your business avoid being flagged for an audit. If you are audited, they have the credentials necessary to represent your business.
As a business owner, you have enough going on, and you shouldn’t constantly be stressed about your company’s financial side. That’s where a CPA can prove invaluable for your business operations. Consider the reasons above for hiring professional accounting services, and make it a top priority to find a reputable CPA in your area. Both your well-being and your business will benefit!