Business Management - Small Blog

IC asked:


The first step towards successful small business accounting is finding the right accountant. Small business accounting is all about being practical. That’s why hiring a full charge accountant might not be such a good option, specially when it involves paying up front fees and charges which would create costly expenses your business might not be ready to cover.

For many “who like to do things yourself” it is important to keep in mind that proper knowledge of small business accounting is required if you want to keep your finances in order. One important aspect which will help you decide whether or not you should hire someone to the accounting job is to know to the best of your abilities what your budget and financial responsibilities are. Remember that bookkeeping is just one of the many expenses you will incur during the process of running your business so you need to be able to properly allocate your resources.

Fortunately, there are several ways you can overcome this obstacle which would get in the way of your business growth otherwise. A few of the options you have are the following:

Do your own accounting:

This option is only recommended to those business owners who have had previous education or instruction as far as handling and keeping accurate records of assets, liabilities and expenses. It is important to have basic knowledge of bookkeeping tools such as: Microsoft financial management, Quickbooks, Microsoft Excel, etc.

If you prefer not to use a computer to handle these tasks then proper knowledge of accounting equations and management is necessary.

Hiring an accountant:

This option may prove to be useful to small business owners who have an especially set budget for accounting purposes. As previously mentioned, full charge book keepers can be quite expensive so having a good idea where your accounts receivable and payable stand will give you clue how much it will cost you to balance, close and generate quarterly reports.

Outsource your accounting tasks:

A third option is also available to small business owners, which involves having an accounting outsourcing firm do the work for you. Many of these firms offer multiple services which can prove to be useful and effective. Since these firms specialize in small business accounting they may also offer tax return services, payroll management, bank account reconciliation, financial reports, Quickbooks reports, etc.

It is safe to assume that an independent CPA would charge a considerable amount of money for such services. Outsourcing financial tasks is an option many small business owners should consider.

A good example of an excellent accounting-outsourcing firm available to small business owners through the web is Accountiviti which provides high quality, innovative and affordable business solutions.

The bottom line is that small business accounting is a mixture of cash vs accrual accounting which should be handled accurately by a capable CPA or accounting firm in order to clearly see changes of a posted document over time.

While many business owners may consider to do their own book keeping it is always helpful to know that there are many choices available besides hiring a CPA.



Derrick