Business owners know their business like no one else—except for their accountant! Your accountant, whether inhouse or an outside firm, knows the ins and outs of your business from the financial point of view. While you know your business's expertise in regards to the unique service or goods you provide for your customers, your accountant's expertise also factors into the success of your business. Their work, however, does not exist in a vacuum. It requires a consistent dialogue between you, the business owner, and your accountant.
Here are 5 ways you, as the business owner, can help your CPA firm help you to grow your business.
1. Be Consistent
When you are conducting business transactions it is wise to be consistent in those transactions when at all possible. This will assist in the everyday bookkeeping as well as the monthly review and tax implications from year to year. The more detailed and consistent information you can provide, the better.
Whether it is a note on a paper check or a scan of a receipt, this goes a long way to shine a light on cash flow. When transactions are recorded properly, it saves time and money, not to mention the elimination of unnecessary stress trying to remember what an expense and/or revenue was for.
2. Be Accurate
Keep personal expenses separate from business expenses. When business owners use business accounts to pay for personal expenses, it simply just muddies the water. This practice makes it difficult to keep these separate—and you do need them to be separate—if only from an income tax or sales tax perspective.
This practice will flag your accounts, both business and personal, to government auditors and will possibly require additional documentation to prove one way or another what the expenses were for. It is a costly practice in that it takes time to process those transactions by personnel as well as spending your time explaining whether these questionable transactions are personal or business. The less time it takes to process, research, record transactions, the more money and time you save. And the more money you save on this end, the more you can reinvest in your business.
3. Be Engaging
Use your accounting/CPA firm as a source for other business connections. Your CPA can and should be willing to recommend other businesses you need to help your business maintain profitability. From insurance brokerage firms, retirement consultation recommendations to employee morale, your accounting/CPA firm can and should have recommendations for you and can perhaps make the introductions as well.
4. Be Available and Responsive
Your CPA/accountant understands you are a busy business owner. However, there are times when they need timely answers and/or direction from you. Of course, if you are utilizing the above suggestions, this will probably not be disruptive to your schedule.
Again, the more consistent and accurate you are up front, the less time will need to be spent following up. But just as you enjoy your financial statements, answers to your questions, etc. in a timely manner, your accountant/CPA also needs that timely response. A late response will end up costing you more time and more money in the long run.
5. Be Reasonable in your Expectations
While your accounting/CPA firm should be available to you in the above-mentioned areas, they are still primarily engaged to perform various duties from bookkeeping, reconciliations, tax planning, tax preparing, etc. Additional or excessive questions can become a detractor to what your accountant has contracted to do for you.
Any additional work, research, meeting should and will cost additional funds. This could end up costing you more than necessary than if you simply respect the time and consistency of your accounting/CPA firm.
Be consistent, be accurate, be engaging, be available, and be reasonable. These are the makings of a long and profitable relationship with your CPA/accounting firm. When everyone works together, the impact on business growth and personal lives are profound.