The title CPA immediately evokes images of an accountant scouring stacks of papers for tax prep, hunting for deductions, and ensuring compliance with tax codes. And while CPAs certainly handle these important tasks, they also deal with far more than just taxes. A CPA is an accredited expert on finances, and often their potential goes untapped by small businesses.
CPAs–especially those specializing in helping small businesses–have all the training necessary to tackle many of the financially daunting problems that a business is faced with on a regular basis, and are a valuable resource for navigating the financial consequences of any decisions the company has made in the course of the year. For small businesses, utilizing a CPA firm to their fullest potential can even the playing field with larger businesses that have financial experts on staff.
Your small business CPA is a highly qualified professional with expertise in all manner of business matters. While they are highly valuable at tax time, their skills can help with financial decisions all year long. In this article, we’ll explore five ways you probably didn’t know your CPA can help you.
If you’re a small business owner, your team is important. With fewer employees than large corporations, each one plays a significant role in shaping your company’s identity. You want to be there for your employees and take care of them, but you also want to ensure that you have the right team who will perform and deliver what you need to meet your goals.
A small business CPA can assist in a number of personnel-related areas. They can also help you navigate the decision-making process around potentially challenging topics like:
When to hire: Your CPA can look at your revenue flow and determine if your income and growth trajectory indicates whether you can afford to bring another employee on board, weighing that against the potential increase in productivity a new hire would bring.
Raises: CPAs can show the long-term implications of raises and contractual pay changes to both your bottom line and your retention rates.
Theft: When your numbers aren’t quite adding up, your CPA can examine your books to determine if any trends exist that might indicate internal theft.
Pricing can be difficult, especially for a small business that often is subject to the whims of competitor pricing. Small business owners are faced with questions about whether to base their pricing on cost and required return, or on desired market competition. Answering these questions with anything other than a guess is extremely challenging, but with a little market research, your CPA can apply financial analysis to your specific situation to see what the best course of action will be. Optimizing appeal and profits through price is simply an equation, and your CPA is a readily available partner who is already familiar with the specific circumstances of your business.
You’re proud of your business, but what’s it really worth? Again, your CPA can help you get a fair and accurate valuation of your business. Partnering with a CPA is one of the few ways to get an unbiased business valuation, as often when selling or being appraised for a loan you will encounter inflated or deflated values to fit the desired outcome of the interested party. There are multiple ways to value a business. Your CPA can walk you through the nuances of your specific assets and liabilities and discuss book value and fair market value. As they are familiar with your business, they can offer guidance on which one is closer to an actual value for the company.
Most small business owners consider running prospective contracts by their lawyer, but they should also consider letting their CPA have a look. Legal contracts have financial implications that may seem trivial at the moment but could prove massive over time. Your CPA is the best expert to review your contracts and project the short-term and long-term consequences of those financial implications. For loan or lease contracts, your CPA can be especially helpful in weighing the offer you are getting against alternative lenders or, in the case of leases, what the long-term differences are between lease and purchase.
From day one, any small business should consult with a CPA regularly. Your small business CPA is an expert at analyzing financial data, and every year you work with them is another year of data for them to base advice on. They can offer a guiding hand as early as business plans and incorporation, but even if you’re well beyond the startup stage you can still gain long-term advantages from working with a CPA.
A CPA can help show you how to make financial goals work. Whether your goals are expansion or retirement or anywhere in between, a CPA can show you how to manage your finances to get there. They also can help you plan for the unexpected by having a succession plan ready to ensure your business carries on according to your wishes in the event of a worst-case scenario.
A small business CPA is for so much more than just taxes. They are skilled, qualified financial professionals who are ready to help you be as successful as you can be in your business. Your CPA is a trusted partner in all financial matters and there are many other ways that they can help. Contact your BradleyRenner CPA today and learn what else we can do for you.
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