Reasons to Hire an Accountant
If you’re a small business owner, you may have been managing your money pretty well – for now. Besides, you have all the tools you need on the Internet, and you won’t even need any financial knowledge or experience. But as your business grows bigger, you may have a harder time maintaining your growing financials, not to mention the accompanying legal and compliance issues. Certainly, you can use an professional’s expertise.
Here are specific scenarios that serve as signs you need to hire an accountant:
You have no knowledge about accounting.
If you find financial statements and accounting terms too complicated, you can hardly create a report or you’re totally unfamiliar with the U.S. Tax Code, then without a doubt, you need an accountant – at least initially – to give you lessons on these.
Bookkeeping consumes you’re a lot of your time.
Maybe you do know a decent bit about accounting, but managing your books is keeping you from managing your business well. Hire an accountant so you can concentrate on what you do best, which is your business.
Investors want professional financial reports.
An accountant will be able to create high-detail, accurate reports that satisfy your investors and let you concentrate on running your business.
Your business experienced rapid growth.
It’s good that your business is booming, but note that this is accompanied by more customers, more employees, more vendors, etc. Add to that more paperwork and number crunching, which means it’s plain illogical to think that you can still do everything effectively on your own.
Only your revenue is rising, not your profit.
If you’ve had a boost in sales with a not-so-significant increase in profit, an accountant can take a look at your financials and recommend adjustments – for example, controlling certain overhead costs – so as to increase your profit margin.
You’re branching out in another state.
If you have plans of expanding into another state, an accountant will help you comply with all the regional tax reporting requirements.
You have plans of buying or selling property, or selling your business.
Whether you’re planning to grow your business through an acquisition or sell your business partly or entirely, an accountant can help reduce your taxes by structuring the transaction accordingly.
You’re being audited.
Should you find yourself in the messy process of an audit, an accountant can take over and represent you before the IRS.
If you’ve come to the decision that you need an accountant, your next step is to choose the right one. Not all accountants are created equal, and just like physicians and lawyers, they have specialties as well. A little homework can make a huge difference.