How to Use an Accountant to Help Your Small Business

Running a small business is filled with challenges. A business owner has to provide a quality product or service, find someone who is willing to buy it, manage employees, and have enough money in the bank to cover expenses. So what can help make this easier? The advice of a great accountant.

Most small business owners think of an accounting professional as someone who makes sure taxes are paid on time and accurately. While this is a vital function, they can also do so much more. Skilled accountants can help maintain financial statements, forecast cash flow, provide business advice for expansion, and help you reduce unnecessary expenses. Their advice can spell the difference between business success and failure.

Monthly Financial Statements

Monthly financial reports are static, month-end reports are usually prepared by an in-house bookkeeper. They track the businesses revenue and expenses, and are used to calculate profit. An account will reconcile your bank accounts and close the operating month.

After an accountant reviews your financial statements, they may suggest some internal controls to help you run the business better. For example, the accountant may suggest reviewing the company's income statement each quarter to look for variances in revenues and expenses in excess of 10%. This might identify potential cost savings and opportunities to grow your profits.

Cash Flow Forecasts

An accountant can help you set up a cash flow forecast system that will help you plan for the ebbs and flows of the business. Once this is setup and maintained, you can share it with key staff members, who will help you achieve your monthly financial and cash goals. Reviewing your cash flow forecast with your accountant can provide valuable input because they are already familiar with your monthly financial statements.

Provide A Sounding Board

Quarterly meetings with your accountant will inevitably provide insight to your business. Your accountant will become familiar with your businesses assets, your biggest accountants, and your liabilities. If you are considering making a significant change to the business strategy, your accountant is in a position to provide insight into the financial position of your small business.

Develop a Tax Strategy

Lastly, in addition to tax compliance and reporting, an accountant can help you develop a tax strategy tailored for your business to minimize taxes. This will help you find potential tax deductions available to your business, how to shelter profits from taxation, and income splitting opportunities. Accountants should be aware of upcoming tax breaks or benefits and how my company can benefit from these changes in the law.