Posted on: 12 May 2018
When people think of certified public accountants, they often think of taxes. However, hiring a CPA can be a great benefit for your business, even outside of tax season. Here are some reasons to consider hiring a CPA for your small business.
Your CPA can help you create financial reports and determine your estimated profit and loss, and he or she can help you gain a better understanding of your company's current financial status. In some cases, this means determining how long your business will be able to stay above water without an increase in sales. For companies that are thriving, the financial analysis can help you predict future growth. Your CPA can look at all of the expenses and incoming cash flow to help you learn just where your financial strengths and weaknesses lie.
Legal Structure Determination
If your business is new, your CPA can provide advice and assistance with determining your overall legal structure. He or she can help you determine if you need to set up a limited liability corporation, sole proprietorship, or a limited liability partnership, among other options. Knowing how to best set up your business to protect yourself from liability can be key to keeping your business afloat and to protect you from personal financial liability should your business face a lawsuit.
Your CPA can be a valuable partner when it comes to planning out payroll and benefits for employees. Your CPA can do a cost analysis to see which benefits you can afford to offer and how much you can afford to spend on new hires. He or she can also assist you when setting up your payroll system. This is particularly important if you don't understand the finer points of payroll taxes, such as state and federal taxes or social security taxes. Withholding the proper amount for each employee will help them when it's time to file their own taxes each year, and it also ensures you are complying with local and federal laws.
Before you consider opening a new location or taking out a business loan to cover the costs of expansion, talk to your CPA. He or she can help determine exactly how much profit you need to make each month to support expansion. Your CPA can also create a risk analysis to make it easier for you to decide if it's the right time to expand your business. Expanding when you aren't ready can sometimes be detrimental to your company's overall financial health.
A CPA can be a valuable asset for small business owners.f Your CPA can lighten your workload while helping your company remain fiscally sound.Share