Why Hire a CPA?

Tuesday, November 7, 2017

While you may think the terms “accountant” and “CPA” (certified public accountant) have basically the same meaning, there are several differences.

One of the biggest distinctions of CPAs is they are repeatedly tested and regulated by the federal government. In addition, CPAs are required to take continuing professional education to stay current with new rules and regulations.

Hiring a CPA also has several advantages, including:

Tax compliance – What forms do you need to file and what are their due dates? What income is taxable and what expenses are deductible?

Budgeting – CPAs can help create your organization’s initial budget, develop reasonable estimates, determine the drivers behind revenue and expenditures; figure breakeven points, etc.

Setting up a financial system – You can get help with accounting software set-up and training, as well as internal controls.

Payroll taxes – Because they’re complicated, it’s easy to make mistakes with payroll taxes. A CPA can assist in client payroll systems and payroll outsourcing options.

Financial statement preparation – Compiled or reviewed financial statements may be needed for management purposes, financing or bonding.

Sounding board for financial recommendations – These include asset purchase decisions, return on investment, buy or lease, etc.

Designing and enforcing accounting/internal controls – A CPA can help with payroll, cash receipts, payments, petty cash, separation of duties, etc.

Credibility – Having a CPA prepare or review financial statements and tax returns gives you and your company credibility.

Cash flow analysis – Preparation of projections, estimates or proformas correlates directly with budgeting.

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