If you own a small business, then you’re undoubtedly familiar with creatively cramming your operating costs into a bootstrap budget, often doing things on your own to stretch available funds further.
One common “DIY” area for entrepreneurs is their small business accounting.
Small business accounting seems like a good place to cut costs, as long as you have a solid small business accounting background and good business finance comprehension.
But, if you don’t have a lot of experience managing small business accounting and expect to learn-as-you-go, then Sherman Oaks Accounting & Bookkeeping powered by One Source Services, Inc. strongly suggests that you think twice before taking on your own small business accounting.
Incorrectly managing small business accounting can irreversibly damage your business!
In case you’re still vacillating about whether or not a professional bookkeeper would be a good investment, we compiled the following list of things a professional can do for your small business accounting.
In order to create a solid foundation for a successful small business, an entrepreneur must do many things that a professional bookkeeper or accountant could help with including:
- Determining which business entity is right for the business (Corporation, LLC, Partnership, or Sole Proprietorship).
- Creating a business plan that includes a financial analysis.
- Choosing and implementing a small business accounting software system.
- Assisting with and advising on small business bank & credit accounts.
- Ensuring compliance with federal, state, and local government requirements.
- Providing guidance on proper daily business expense & income tracking.
- Implementing procedures that separate business from personal expenses.
Once the business is up and running, regular small business accounting maintenance is required to get the most out of the software your professional bookkeeper or accountant setup. This can include:
- Correctly classifying employees and independent contractors.
- Running meaningful financial reports & reacting appropriately to meet goals.
- Managing payroll, accounts payable, invoicing, accounts receivable, inventory, and other assets and liabilities.
- Preparing for tax filing and making estimated tax payments if appropriate.
- Preparing and distributing W2 and 1099 forms.
- Performing month-end and year-end closing of the books.
- Compiling and submitting financial reports and other tax documents to the CPA for year-end taxes.
GROWING THE BUSINESS
Now your day-to-day small business accounting is manageable and running smoothly, but there are still many ways that a professional bookkeeper or accountant can be a useful resource if you want to see your business grow. They can:
- Identify growth opportunities by monitoring cash flow patterns, managing inventory, pricing, and small business financing.
- Advise on purchasing or leasing property, equipment, and other assets.
- Keep the books audit-ready, help avoid an audit, and expertly assist and guide you in the event that the IRS does audit your business.
- Help establish and support business goals & create a budget that backs them.
- Offer advice, resources, and even oversee the sale of your business.
It’s not possible for us to list all of the ways that a professional bookkeeper can valuably contribute to small business accounting. But the list above is a convincing start!
Sherman Oaks Accounting & Bookkeeping powered by One Source Services, Inc. supports our clients’ small business accounting with a combined approach that tailors activities to individual needs.
For example, some of our clients want help starting-up, then we give them the training and support they need to DIY the small business accounting maintenance. It’s not truly DIY, though, because we are always available to answer their questions, offer advice, and provide support.
Then other clients ask us to do all the regular small business accounting maintenance for them, including reporting and tax preparation. Different businesses, different needs.
Working closely with a professional bookkeeper or accountant on your small business accounting will develop an invaluably efficient, effective accounting team for your business without the large in-house accounting department expense.
It’s critical that an entrepreneur recognize when they need professional help with small business accounting, and that they can find a professional like Sherman Oaks Accounting & Bookkeeping powered by One Source Services, Inc. to assist when needed.
Maximize the financial success of your small business!