2014-10-14 11:51:09AccountingEnglishFind insider tips on working with an accountant to make sure the money you spend works to your advantage. Learn about working with an...https://quickbooks.intuit.com/r/us_qrc/uploads/2014/08/meeting0iStock_000023609277Small.jpghttps://quickbooks.intuit.com/r/accounting-money/getting-accountant/Tips for Working With Your Accountant | QuickBooks

Are You Getting the Most from Your Accountant?

3 min read

Although the 2013 Small Business Taxation Survey released by the the National Small Business Association (NSBA) estimates that 84 percent of small-business owners turn to accountants for help pertaining to tax matters, hiring an accountant, even in a limited capacity, is not cheap. According to a National Society of Accountants survey, the average fees in 2013 to prepare federal tax forms were $590 for a partnership, $761 for an S corporation, and $806 for a C corporation. While an accountant can be an invaluable resource to help your business leverage all possible tax-reduction strategies, the cost of isn’t always justified — or necessary. We spoke to a number of accountants and small-business owners to get their insider tips on working with an accountant to make sure the money you spend on their services works to your greatest advantage.

Leverage Your Accountant’s True Expertise

Nearly a quarter of the NSBA’s survey respondents said they spend 120 hours a year or more tending to business-related financial tasks like payroll administration, financial reporting, and the simple process of working with an accountant. Despite that time commitment, nearly half of those surveyed spend $5,000 or more each year on the administration of federal taxes (beyond basic accountants’ fees). To ensure your accounting costs are optimized, limit your accountant’s focus to the functions that contribute to your business’s overall financial health: Helping you lessen your tax burden and working with you to prepare financially for your longer-term business goals. “Your accountant can help you analyze your expenses, look for ways to reduce expenses, and understand your cash flow, so you can make better financial decisions about when and how to spend your business’s income,” says Marquita Miller, owner and president of Five Star Tax & Business Solutions. If you intend to borrow money to grow your business, Miller adds, your CPA can ensure your financials are in order, so you are prepared to visit with potential lenders.

Understand Your Accountant’s Process

Handling basic bookkeeping-related tasks yourself, including expense and accounts receivable tracking, can keep your accountant’s billable hours at a minimum, but Michael Breier owner of Breier Consulting, Certified Public Accountants says it’s smart to ensure that your financial processes are aligned with your accountant’s to ensure that you are actually gaining efficiencies — even if you rely on an automated accounting software program to capture data. When you understand what kind of information your accountant needs — and can prepare it appropriately — you can reduce the amount of time your accountant spends at year end analyzing accounts and making or adjusting journal entries. If you’re not particularly proficient with accounting software, or are unsure how to provide the data in a way your accountant can use, Breier recommends asking your accountant to provide some “basic training” in how to use your accounting software: “Investing in this type of training often allows the small business to get more accurate and timely financial information throughout the year, helping the business owner to make timely decisions and get the most out of consultations with the CPA,” he says.

Learn to Speak the Same Language

You may not consider yourself to be a numbers person, but the more you learn to”translate” the financial information your accountant prepares, the more you’ll get out of the relationship. “Most small-business owners don’t realize that their CPA is often the best source for analyzing and interpreting financial statements in a language they can understand, beyond numbers on a page,” says Brier. “Ask questions, and demand an interpretation of what the numbers mean in terms of where the company has been, where it is headed, and how you compare to peers in your industry.” If your accountant is unable or hesitant to take the time to explain information in a way that you can absorb, Breier says its time to shop around.

Ask Questions That Can Help You Reach Your Business Goals

Knowledge is power — and it can maximize the investment you make in your accountant. “Don’t just rely on the accountant to offer write-off, deduction, and accounting strategies; research recent tax laws and come prepared with questions on how such changes might impact business,” says Deborah Sweeney, CEO of MyCorporation. Sweeney says that this approach ensures you remain informed about your business and potential vulnerabilities tax codes may present. This can also trigger valuable discussions with your accountant about the state of the business, your goals, and any concerns that might otherwise be missed or remain unaddressed.

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Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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