FAQs: Getting the Most out of Your Accountant
What is the Best Way to
Work with My Accountant?
Once you’ve interviewed and
hired an accountant, then you want to make sure you get
full value from them. You can achieve this by committing
to a real working partnership and by consulting over
every business decision you make that will have tax
implications. Such decisions might include real estate
purchases, the hiring of new employees, changes to
employees’ terms and benefits, and the leasing or
purchase of plant and machinery.
For example, your accountant
might advise you to record business income on cash,
rather than an accrual basis, or they may say that it is
more tax efficient to lease than to buy certain
equipment. They can also prepare any necessary financial
statements such as income statements or balance sheets.
Keep an open mind and don’t
be resistant to new ideas or changes in business
practices recommended by your accountant – he or she is
a professional and will give you professional advice
from an experienced point of view.
How Much Does My
Accountant Need to Know?
Be prepared to go into detail
with your accountant about your business plans,
including your objectives and your problems and
questions. Make sure you have all the relevant financial
and business records that your accountant might need in
order to gain a full understanding of where your
business stands and the key issues that they can assist
you with.
If you wish to have personal
financial advice, make sure you are totally open and
honest. Don’t hold back about things such as
debts, bankruptcy, divorce, or other sensitive family
issues. If you do, you won’t receive the expert advice
you need – and this could cost you in the long run.
How Can My Accountant Help
Me with Employee Issues?
Your accountant can advise on
many employee issues, such as unemployment terms and
compensation, payroll systems, health plans, and
retirement plans. He or she can also help ensure
that you hire the most “tax efficient” types of
employees, such as veterans or the disabled, if these
types of employees would be appropriate for your needs.
What about Broader Issues
like Business Planning?
Don’t forget that accountants
are not just number crunchers. They can also provide
valuable strategic input into the business planning
process and advice on the tax implications of creating a
company.
Lastly, always remember that
tax rules are complex and forever changing. A major part
of your accountant’s job is to understand the rules and
keep pace with changes. The tax code itself consists of
over 60,000 pages, and many of the new tax laws passed
every year apply retrospectively.
So, treat your accountant as
a key advisor and an integral part of your management
team and you and your business will reap the rewards
many times over.
With any accounting professional, staying on top of the relationship is key. Know what they are doing and ask questions about anything you don't understand.