Accounting is simply keeping track of a business or individual’s financial exchanges and keeping them all organized in a presentable way. This may sound easy, but with all the different factors that go into small business accounting, it certainly isn’t something that you can just wing and hope for the best. You’re almost certainly going to need to outsource your accounting to a CPA firm, so obviously you’ll want to hire the right people for the job. Here are some of the most costly mistakes that business owners make when hiring accountancy help.
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Considering Their Qualifications the Wrong Way
Despite what a lot of people think, there’s much more to accounting than chewing through numbers. The accountant you hire is going to have a significant impact on every little facet of your business, whether directly or indirectly. Because of this, you’re going to need an accountant who has a keen understanding of your business niche. There are certain universal qualifications, like a CITP certification, which you should certainly be considering. However, if you want the best accountant available to you, you’re going to need to look past their official qualifications. Find out how much experience they have with businesses in a similar vein as yours, and draft interview questions which will gauge how good their communication skills are. These will both have a profound impact on how much they can offer your business.
Starting to Hire Before You Know What You’re Looking For
Before you even begin typing up an ad for an accounting position, you need to spend some time thinking about your business’s specific accounting needs. Do you need help with your taxes and payroll? Do you need someone to process all your sales invoices and accounts payable? Are you a little shaky with budgeting and financial statements? These are the kinds of questions you should be asking yourself before you take the very first steps in your recruitment process, and using them to draft a kind of shopping list for the services your business needs, and what it may need further down the line. Once you’ve established this, you’ll be in a much better position to hire the CPA firm or accountant who’s right for you. Remember that your revenue isn’t going to be the only thing determining your needs for accountancy. If you’re bringing in a lot of cash, but with few transactions, you probably won’t need a full-time service.
Taking the DIY Approach
One of the worst things that a business owner can do when it comes to sourcing accountancy help is not getting any help at all, and trying to manage their books themselves. Accounting is a very complex profession. That’s why people go to college for it and have to meet strict industry standards before they start practicing! A qualified and experienced accountant is going to understand all the financial processes you rely on to keep your business ticking, and will be able to execute them without any errors or delays. These can have disastrous financial impacts, so avoid the DIY approach like the plague!