Should I Hire an Accountant for My Small Business?

As a small business owner, you know how difficult it can be to stay on top of your finances. But should you look for outside help? Hiring an accountant may seem like an extra expense, but it can end up saving you time and money in the long run. Not only are accountants knowledgeable about taxes and legal compliance issues related to running a business, but they can also provide valuable insight into strategies for managing your expenses more effectively. Read on to find out if hiring an accountant might be right for your small business!

What does an Accountant do?

When it comes to running a small business, one of the most important tasks is managing finances. This is where the role of an accountant comes in. An accountant can provide a range of services to help manage the financial health of a small business, such as preparing financial statements, managing tax liabilities, and providing advice on financial decision-making.

With their expertise, an accountant can also help identify areas of improvement and offer solutions to optimize cash flow and increase profitability. Having an accountant on board can make all the difference in the success of a small business, allowing you to focus your time on other areas of your business.

When is it Time to Hire an Accountant for Your Small Business?

It can be tempting to try and handle everything yourself, but at some point, you may find that you need the expertise of an accountant. So, when exactly is the right time to hire an accountant for your small business?

The answer can vary depending on your specific situation, but generally speaking, it's a good idea to consider working with an accountant if you are experiencing any of the following:

• Difficulty managing your finances
• Confusion about tax laws
• Lack of time to devote to financial tasks

5 Tasks an Accountant Can Take Over for Your Small Business

If you're struggling to juggle your accounting tasks, it's time to consider seeking professional help. By delegating these time-consuming tasks to a professional, you'll have more time to focus on running and growing your business.

1. Maintaining financial records

One of the most important things an accountant can do for a small business is to maintain accurate financial records. Financial records help business owners track their income and expenses, which is essential for making sound business decisions. Without accurate financial records, it would be very difficult for a business owner to know whether or not their business is profitable.

2. Preparing financial statements

Another common task that an accountant can do for a small business is to prepare financial statements. Financial statements provide a snapshot of a company's financial health and can be used to identify areas where the business may be overspending or underperforming. Financial statements can also be used to track the progress of a business over time.

3. Paying taxes

Another common task that an accountant can do for a small business is to pay taxes. Small businesses are required to pay federal, state, and local taxes, and an accountant can help ensure that all of the necessary taxes are paid on time. Failure to pay taxes can result in significant penalties, so it is important to have an accountant handle this task.

4. Managing payroll

Another common task that an accountant can do for a small business is to manage payroll. This includes preparing payroll checks, calculating withholdings, and paying employee taxes. Payroll management can be complex and time-consuming, so it is often helpful to have an accountant handle this task.

Related Reading: The Best Payroll Software for Small Businesses

5. Advising on financial matters

Another common role that an accountant can play for a small business is that of an adviser on financial matters. An accountant can offer advice on a variety of topics, including how to save money, how to invest money, and how to reduce expenses. Having an accountant advise on financial matters can help a small business make sound decisions about its finances

What is the Cost of Hiring an Accountant?

Small businesses are constantly searching for ways to save money and reduce expenses. However, when it comes to accounting, is it worth hiring an accountant on a part-time or full-time basis? The cost of hiring an accountant varies depending on the services required and the experience level of the accountant.

Typically, a full-time accountant can cost anywhere from $45,000 to $90,000 per year, while a part-time accountant can cost between $50 to $150 per hour. Ultimately, the decision of whether to hire an accountant part-time or full-time boils down to the size and complexity of your business.

A small business that requires minimal accounting services could benefit from a part-time accountant, while a larger business with more complex financial needs may require a full-time accountant. It is important to consider all options and the specific needs of your business before making a decision. Hiring a professional accountant can ensure your business's financial health and success.

Benefits of Hiring an Accountant for Your Small Business

If you're like most business owners, who started their ventures with a focus on their passion, then you likely did not anticipate the significant amount of time and effort involved in crunching numbers and managing financial ratios. This can leave you feeling overwhelmed and stressed and take away from the joy of running your business. The good news is that you can focus on doing what you love and hire an accountant to take care of the accounting tasks. Here are 6 benefits of hiring an accountant when it's right for your business.

1. They Can Help You Save Money

One of the biggest benefits of hiring an accountant for your small business is that they can help you save money. An experienced accountant will be able to identify areas where you may be overspending and offer suggestions on how to cut costs. They can also help you take advantage of tax breaks and deductions that you may be eligible for.

2. They Can Help You Make Money

An accountant can also help you make money by making sure that your business is as profitable as possible. They can do this by helping you to keep track of your expenses and income, as well as advising you on pricing strategies and ways to increase revenue.

3. They Can Help You Stay Organized

Another benefit of hiring an accountant is that they can help you stay organized. An accountant can help you set up a system for tracking your finances so that you can easily see where your money is going and where it is coming from. This will make it easier for you to make informed decisions about your business finances.

4. They Can Help You Avoid Financial Problems

An experienced accountant can also help you avoid financial problems by catching errors and mistakes before they become too costly. They can also help you to plan for unexpected expenses so that you are not caught off guard by them.

5. They Can Help You Understand Your Financial Statements

One of the most important things an accountant can do for your small business is to help you understand your financial statements. Many small business owners do not have a good understanding of their income statement or balance sheet, which can lead to problems down the road. An accountant can explain these statements to you in plain English so that you can make informed decisions about your business finances.

6. They Can Offer Other Services

In addition to all of the above, many accountants also offer other services such as bookkeeping, payroll, and tax preparation. These additional services can be extremely helpful for small businesses, as they can take care of many of the financial tasks that need to be done on a regular basis

How to Find the Right Accountant for Your Needs 

Start by identifying your specific accounting needs and what qualifications your ideal accountant should have. Do you need someone full-time or part-time? How complicated are your business financials currently?

Next, conduct research to find potential candidates and gather referrals from other business owners. Meet with potential candidates to gauge their experience and expertise, and don't be afraid to ask for references from those in your network. If you are looking for someone part-time, online freelance hiring sites like Upwork are a great place to start your search.

Finally, consider the cost of their services and ensure that they fit within your budget. By following these steps, you can confidently hire an accountant that will help your small business thrive.

What is the Difference Between an Accountant and a Bookkeeper?

When it comes to managing financial records for a business, both accountants and bookkeepers play a vital role. While they may share similar duties, there are some key differences between the two roles. Bookkeepers are primarily responsible for recording financial transactions, reconciling bank accounts, and managing invoices. They ensure that the financial records are accurate and up-to-date.

On the other hand, accountants use the information provided by bookkeepers to analyze the financial health of a business and make strategic decisions. They provide advice on tax planning, financial forecasting, and investment opportunities.

While both roles are important, accountants generally have more education and experience and are expected to have a deeper understanding of financial principles. Ultimately, the difference between an accountant and a bookkeeper is that the former uses financial data to guide the direction of a business, while the latter is focused on accurately recording financial transactions.

Keep Your Business Finances on Track

It is essential for small business owners to take a careful look at their financials to decide if they need an accountant. As the business grows and more complex transactions occur, having a qualified professional can help provide peace of mind and ensure the most accurate financial information. With this in mind, we invite you to subscribe to our weekly newsletter, where business owners can get access to insight into practical and helpful ways to manage financial operations for their small businesses.