Ask SCORE
Choose
Accounting Services Carefully
As
you launch or expand a business, keeping track of the money,
preparing tax returns and performing other financial tasks can
quickly become a burden. If you need more time to do other
things, it might make sense to turn over tax, accounting and
other financial chores to outside specialists.
Choosing the right type of tax, accounting, bookkeeping or other
financial help is an important decision. An outside accountant
can be one of your most trusted business advisors and a key to
your success. Although many business owners work with big
national firms, most prefer to work with small independent firms
or solo accounting professionals.
Accounting
services differ from bookkeeping services, however. An
accounting firm prepares financial statements and tax returns
based on the numbers that you give them via your own
in-house books. Bookkeeping services, if offered, will be extra.
If you plan to hire your own bookkeeper, make sure the person
you choose is qualified. One way is to use the “Bookkeepers
Hiring Test” available free from the American Institute of
Professional Bookkeepers at their
web site.
Before selecting a certified public accountant (CPA) or other
financial pro, list the services you think you need, such as tax
preparation, financial reports, balance sheets, invoicing,
payroll services, general bookkeeping or someone to set up your
books. Some firms may handle it all, or you may need to split
the tasks. CPA Directory is a huge online listing of CPAs
nationwide and can help you find an accountant in your area.
The web site also
offers helpful advice on hiring and working effectively with a
CPA.
And don’t forget about Enrolled Agents. EAs are licensed by the
Federal government to prepare tax returns. They have either
worked for the IRS or have passed a rigorous IRS exam. They are
savvy tax experts, but generally don’t have the degrees of CPAs
and tend to charge less. Visit the National Association of
Enrolled Agents web site.
Fees vary greatly among accountants, from $50 per hour to $300
or more. Some firms will provide a specified list of services
for a flat monthly fee, and may provide less costly help for
bookkeeping and other tasks that don’t require CPA-level
training. If you are considering a larger accounting firm, find
out which people you will be working with directly. Also try to
match your general philosophy with a firm that is as
conservative — or aggressive — as you are on tax matters.
Further advice on financial issues for your small
business is available from SCORE Counselors in Cedar
Rapids. More than 65 business- men and women provide free,
expert, confidential business counseling and low-cost workshops,
both for existing small businesses and for those wishing to
start a business. Call 319-362-6405 ext 2005 or apply for
counseling online at
www.scorecr.org .
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