5 Signs Your Business Needs a CPA
Unless you hold a degree in accounting, it is very unlikely that you have the same skillset and knowledge as a certified public accountant (CPA). And while you may be able to get by for a while running the finances and keeping the books for your small business, especially with practically foolproof modern tools like QuickBooks on your side, the truth is that you have other tasks to occupy your time when it comes to keeping your business afloat, and you might not have adequate time and attention to devote to proper accounting practices. This could make for some major problems as time goes by, not only with your day-to-day financial situation, but also with your business tax returns. And if you get audited, the consequences of sloppy bookkeeping could negatively impact you in a major way. The point is, you may at some point decide it’s time to bite the bullet and hire a CPA, at least seasonally. Here are a few signs that your business is in dire need of the expert help this professional can provide.
- Your receipts get stuffed in a shoe box. What are you, twenty? You’re running a business and your operations need to be professional and streamlined. This means diligently tracking income and expenses so that you always know where you stand with your accounts. Sure, online banking is great, and having corporate accounts (as opposed to co-mingling your personal and professional finances) is a step in the right direction. But if you’re still using antiquated methods of bookkeeping such as saving receipts in a shoebox and tracking via hard copy, it might be time to concede that a modern and professional point of view is needed to get your financial situation in ship shape.
- You owe the IRS. Although it’s not uncommon for businesses to end up owing money come tax time, you’re probably paying more than you should if you aren’t hiring a pro to file your taxes for you. A CPA, for example, can help you decide if filing estimated quarterly taxes is in your best interest, as well as apprise you of deductions you may be missing out on specific to your industry, your products, or your type of corporation. A good CPA will not only reduce the amount you owe the IRS, but he will more than pay for himself in the process.
- Your company is growing. If you’re earning money and recognition, it may be time to think about expansion. Unfortunately, this could mean taking on a lot of additional responsibility, leaving you little time for accounting. Whether you’re hiring more people, taking on partners, or opening additional retail locations, just for example, you’re going to complicate and broaden the scope of your finances in the process. And you may need some professional help to handle the additional workload.
- You don’t have time to read tax laws. Tax laws change all the time, and CPAs are uniquely qualified to keep up with these advances on your behalf (as they’re required to do so for licensing exams). You’ll eventually have to face the fact that you have limitations and hire the right people for the job.
- You’re worried about an audit. Whether you hire a CPA as a permanent addition to your staff or you contract with an accounting firm like Bowman & Company, there’s no better way to face an audit than with a financial expert on your side. And a CPA can represent you during an audit, working directly with an IRS agent on your behalf to ensure that your interests are seen to.