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As businesses grow, their accounting needs change. You might have started with something as simple as a spreadsheet. Then you upgraded and spent the money on a QuickBooks account. Finally, you hired an accountant as your needs became more complex.
Basic business accounting is a commodity service. They review your bookkeeping, make sure your taxes are filed on time, and then you may not hear from your accountant for another quarter or possibly even another year.
But at some point, your accounting needs to move beyond the basic commodities of tax compliance. Businesses with more than a few million dollars in revenue are more complex and filing tax returns is the bare minimum you need to make your accounting and finances work for you. If that’s all your accountant is able to do for you, you may have outgrown them and it’s time to move on.
As a business owner, you probably know your profit and loss statement inside and out, and your accountant should too. But if your accountant is making business recommendations with your P&L as their only point of reference, then they’re missing big parts of the picture and could potentially be holding back your growth.
When your building hits a certain size, you need an accountant who can make suggestions based on your financial performance, and understand the nuances of what drives your success. At this point, their accounting services go beyond the checkboxes of a tax return and become a deep dive into what you need to do to improve both your top and bottom lines.
A good accountant for your business is one who can take a look at your processes and help you identify which ones are making you the most money. If the sales that you as the owner work on are more likely to close than the ones you pass to your sales team, your accountant should be able to identify these trends so you can find ways to increase sales across the company.
Similarly, your accountant should be able to look at your expenses and find opportunities to cut back, or places where your spending didn’t pay back for itself. They’ll be able to tell you if this isn’t the year to rebuild your website, or that this is the year since your e-commerce volume has gone through the roof.
Accounting for tax compliance is a very detail-oriented job. These accountants know every form, every checkbox, and they know how to keep you on the right side of the law. By comparison, if you’re looking for more of a consulting accountant who can help you look at the bigger picture and recommend changes to grow your business, these are much more conceptual tasks.
Not to say that one person can’t do both tasks, but as your needs grow, it’s possible that your accounting team will grow with it. If you’re working with an accounting firm, you may have one person who stays on top of your compliance needs, while another can go over performance and strategy to help you set targets for the coming fiscal year and beyond.
One of the things to look for if you’re expanding your accounting team is the right credentials. While all accountants go through standard education and licensing according to where you live and operate, that licensing may not be enough to show they have the skills to help you really increase the value of your business.
An accountant who is also a Certified Value Builder™ has undergone training in a statistically proven methodology to help business owners identify the drivers of company value that may be holding them back from hitting their goals, and also which drivers can be leveraged to increase the value of their business.
You may be reading this and thinking to yourself “I’m already using a business coach or management consultant. Why would I need an accountant to offer advice too?”
Over the course of your career, you may work with a number of advisors. They each bring specific expertise and training to the table. While a business coach can help you work through your leadership strategy or product development, and a management consultant can help you spec out new enterprise software, an accountant brings a deep financial understanding that you may not find elsewhere.
While other advisors can help you solidify your brand’s messaging or the challenges you may be facing in managing a team, accountants will specifically look for ways to help improve your financial performance. Their advice may go hand in hand with projects you’re working on with other advisors, but their perspective is different and can often be invaluable.
To speak with an accountant about how to improve your financial performance, the first step is completing the Value Builder questionnaire. This 13-minute survey looks at everything from your financial performance to how dependent your business is on you to keep the lights on and the doors open. From there, we can connect you with a qualified advisor who can help you dive deep into your current state of business and where your greatest growth opportunities are.
If you’re ready to undertake this valuable step in planning your business’s future, start the Value Builder questionnaire now.