10 Things Every Small Business Owner Needs to Know About a CPA

In business, knowledge is power. The right advice and insight at the right time can be the different between success and failure for your small business. That’s why it’s important to have a strong partner advising you every step of the way. A Certified Public Accountant (CPA) can offer that support and more. They are experienced financial advisors who specialize in advising businesses and individuals on how to manage their money more effectively so they can avoid costly mistakes and reduce taxes. But how do you find the right CPA for your company? And what exactly should you look for when hiring one? Read on to learn 10 things every small business owner needs to know about a CPA...

Be sure you actually need a CPA

Before even beginning to search for a CPA, you should ensure that your company actually needs one. There are many financial advisors out there and while they may have expertise in certain areas, they may not be qualified to provide the help and advice your business needs. A CPA will help you with your taxes, but they may not be able to provide business advice on things like marketing, hiring, or operations. So before hiring an accountant, make sure they have the expertise and experience to meet your needs.

Ask friends and colleagues for recommendations

Once you know you need a CPA, turn to friends and colleagues for recommendations. Word of mouth is still the best way to find high-quality professionals. And because you know the people recommending the CPAs, you’ll be able to tell if they’re qualified for the job. Even if a CPA is qualified for the job, though, that doesn’t mean they’re the right fit for your company. Ask your associates what they like about their CPAs and what services they get from them. Then, find CPAs who can provide similar services for your company.

Look for experience and credentials

When you begin interviewing CPAs, the first thing you should look at is experience. How long has the CPA been in business? How many businesses of your size and type have they advised? Experience is crucial in the CPA world because it shows that a professional has seen it all before. They know what mistakes to avoid and they know how to avoid them. Next, look at credentials. What is the CPA’s certification? What is their education? Are they a member of a professional organization? All of these things can tell you how experienced and knowledgeable a CPA is.

Find out how CPAs are paid

You should also find out how CPAs are paid. Are they paid on retainer? Are they paid hourly? Are they paid a percentage of what they save you? All of these payment types have their pros and cons. Retainer fees are a set amount paid every month. This encourages the CPA to provide consistent and regular service and allows you to budget for tax season. Hourly fees are helpful if you have one-off tasks that you need done. Percentage fees are appropriate if you have complex taxes that require a lot of time and energy.

Ask about the CPA’s process and habits

You should also ask about the CPA’s process and habits. How do they decide what you need to do to reduce your taxes? Do they create budgets? How do they decide when to hire new employees? These are all important questions to ask because they tell you a lot about how the CPA uses their skills to benefit your business. They also tell you about their habits. How do they keep track of receipts? How often do they meet with you? What do they do during those meetings? All of these questions can give you an idea of how helpful the CPA will be to your company.

Ask how you can achieve your goals

Finally, you should ask how you can achieve your goals. What does a successful financial year look like for your company? What do you need to do to get there? These are important questions to ask when hiring your CPA because they tell you what the CPA expects from you and your company. They can also help you decide if the CPA is right for you if they’re expecting too much from you.

Ask about risk management

Finally, ask about risk management. How can you use your company’s financial data to avoid future problems and crises? How can you use data to monitor your company’s progress? These are important questions to ask when hiring a CPA. Through financial data, a CPA can tell you about your company’s strengths and weaknesses. They can also help you avoid crises such as employee terminations and missed deadlines by giving you advance warning.

Summing up

Hiring a Certified Public Accountant can be a great decision for your small business. They are experienced financial advisors who specialize in advising businesses and individuals on how to manage their money more effectively so they can avoid costly mistakes and reduce taxes. Before hiring a CPA, you should be sure that your company needs one, look at their credentials and experience, and ask about their process, habits, and how you can achieve your goals.