There’s no question how critical accounting is to a business but does the need for a CPA automatically follow such a scenario? Given that smaller companies do fine with having either an accountant or a bookkeeper on board, the answer is clearly a “no.”
However, a “small” business isn’t something many people are content with having. Sure, things may start small, but the plan is to grow the business and ensure it becomes a hit among target consumers. So, somewhere along a business’ growth comes a point when role designation becomes more critical.
That’s why it won’t be enough simply to hire a bookkeeper or an accountant; you have to find yourself a full-fledged CPA to handle the business’ finances. While it’s easy to find a CPA these days, it’s a little bit harder to know if they’re a good fit for your business.
Today, we’ll take a closer look at what a CPA is and what he or she does so you can figure out if hiring one is the right decision for your company.
What Does Being a CPA Mean?
Being a bookkeeper or an accountant is not the same as being a CPA, although we understand why some might use these terms interchangeably. These three job titles involve roughly the same tasks but have significant differences that set them apart. Of the three, becoming a CPA is the most challenging since it brings with it countless exams, including the nationally standardized exam that you spend most of your college years preparing for.
Becoming an accountant is a stop along the way towards becoming a CPA, with the last leg of education, experience, and the national exam setting them apart. Both jobs are closely similar on the surface; they both involve the planning of finances, keeping of records, and generating financial statements.
Bookkeeping is, by no means, something to look down on. While it sits in the last position where prestige is concerned, it can still earn you a decent livelihood. Nevertheless, anyone who wants to achieve their full potential in their accounting career should always consider CPA the end goal.
Is Hiring a CPA Worth It?
A CPA’s ability to prepare and file tax returns might be enough of a reason to get him or her on board your team. If they’re not, there’s a good chance the following reasons could.
1. CPAs Are Great at Giving Tax Advice
Audits and tax problems are things that can make any business owner lose sleep. CPAs help ensure that you don’t become an insomniac over these issues by handling them swiftly and efficiently. They are also more than capable of taking care of the local and state board’s requirements in case they decide to make things more difficult for you, too.
With a CPA around, tax season doesn’t have to be hell season. Their extensive knowledge of taxation policies covers your particular business, ensuring that there’s nothing to worry about where tax laws are concerned. So, not only do you get minimal tax burdens, but you also get significantly fewer chances of requiring an audit. You can now breathe that sigh of relief!
2. CPAs Are Great for Assurance
A CPA audit is done to ensure that the “agency that must not be named” (okay fine, the IRS) doesn’t end up doing the audit. You would prefer it that way, trust us. CPA reports provide a faithfully represented view of your company’s financial dealings. They also help you see if the business is performing up to the standard.
With a CPA as part of your team, you get the assurance of unbiased and reliable information, which you can use to make crucial business decisions.
3. CPAs Can Help in Management and Consultation
CPAs typically address financial matters over a business period rather than daily. That said, their involvement in everyday operations has proven to be beneficial for companies. A CPA can plan and strategize in areas, such as financial statements for shareholders, budgeting, cash management, risk management, and estate planning.
4. CPAs Help Solve Money-Related Crimes
If your company’s been losing money through embezzlement, it’s a fraud accountant’s job to discover who is behind it. As someone with extensive knowledge of your financial dealings, the accountant can determine how the theft is being pulled off and thus help come up with a list of suspects.
Fraud or forensic accounting entails working one’s way into the company’s financial records to detect evidence of criminal behavior.
Yes, It’s Worth It!
If your company is at a point in its growth when CPA services would be considered practical and beneficial, do yourself and your business an immense favor by asking for referrals right away. When you find a CPA that meets your personality, cost, and service needs, hiring one would be worth it!
