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 expands, you may have a hard time managing the complexities of your growing financials, not to mention the legal and compliance issues that come with it. Definitely, a professional can provide expert help.
The following are specific scenarios that make it necessary to hire an accountant:
You have limited or 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 is growing rapidly.
It’s great that your business is now more profitable, but keep in mind this also means more customers, a bigger staff, more suppliers, etc. Of course, that also comes with more paperwork and number crunching, and the reality that you just can’t manage all of these yourself in an effective manner.
Your revenue is rising but not your profit.
If you’ve been selling a lot but your profits don’t seem to be moving a lot, you can hire an accountant to point out overhead expenses that you can reasonably cut down on, or recommend other adjustments with the goal of increasing your profit margins.
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 intend to buy or sell property, or sell your business.
Whether you want to grow via an acquisition or sell your business in part or in whole, an accountant can help you determine how to best structure the transaction so that your taxes are be kept to a minimum.
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.
After deciding that you need an accountant, your next move is to find the right one. Accountants are not all created equal, and they specialize in certain practice areas just like doctors and lawyers. A little research goes a long way.