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small business

Jul 07, 2020

When is it Time to Hire an Accountant For Your Startup?

As you grow your business it is important to bring on those that are different from you with different skill sets and areas of expertise. An accountant is often one of those individuals who can help bring order to an area of your business that provides a high return on investment.

So when should you hire an accountant? It can be tempting to research a new product or buy some new software, but be sure you consider whether your accounting department requires more experienced hands.

 

1) When You See Your Books as Frustrating, Not Informative

Many people find numbers confusing, but accountants see them as informative pieces of information that tell a story. If whenever you open your books you see a complicated mess you wish didn’t exist, it may be time to outsource your accounting. 

When you can rely on your books being correct, you will find that the reports are not confusing, but may be helpful - as they should be!

 

2) When You Routinely Find Yourself Making Corrections or Second Guessing Whether it is Correct

If every time you open your books you find yourself needing to make adjustments or wondering why a certain number isn’t showing up it may be time to bring in an accountant. Your books should run like a well-oiled machine.

Transactions should be reconciled accurately and often, while your bank statements should reconcile monthly with your books. 

 

3) You Don’t Notice Any Patterns

One trick accountants use to ensure your books are accurate is analyzing your general ledger for patterns.

For example, does rent appear each month on your books? How about telephone expense or Gsuite? If it doesn’t appear in a month or something changes, does the account need to change?

Patterns in income are also important. You may know December is a month where your revenue increases, but maybe it increases in the summertime as well each year. Recognizing these patterns can help you manage your cash flow and then prepare for the slower months.

Another pattern we look for is ensuring your month-end book balance reconciles with your bank statement. This is a pattern that should repeat with each bank statement. 

 

Are you in need of an accountant? If some of these situations sound familiar to you, it may be time to outsource your accounting. Consider reaching out for a free consultation to decide if your business would be suitable for outsourced accounting services.

 

 

Disclaimer:

This publication is designed to provide information on federal tax and accounting laws and/or regulations. It is presented with the understanding that the author is not rendering legal or accounting services.

This text is not intended to address every situation that arises or provide specific, strategic tax and/or accounting planning advice. This text should not be used solely to answer tax and/or accounting questions and you should consult additional sources of information, as needed, to determine the solution to tax and/or accounting questions.

This text has been prepared with due diligence. However, the possibility of mechanical or human error does exist and the author accepts no responsibility or liability regarding this material and its use. This text is not intended or written by the practitioner to be used and cannot be used by a taxpayer or tax return preparer, for the purpose of avoiding penalties that may be imposed.

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