Small Business Accounting: A Dilemma During Start-Up Operations

Small Business Accounting: A Dilemma during Start-Up Operations

Small businesses oftentimes want to save on cost by not hiring professional accountants when they initially start their operations. They buy the latest accounting software, with small business accounting methodologies, and do the bookkeeping themselves by keeping track of their sales and expenses. When things get complicated, where taxes need to be paid and financial reports prepared for loan purposes, only then will they realize that they need professional help with these requirements. At this point, they start to think about hiring a professional accountant to give them good counsel.

But how do you look for a good one?

If you want someone who can advise you on - tax matters, business organization, preparation of financial reports, and payroll tax returns - you need a Certified Public Accountant (CPA) or an Enrolled Agent (EA) , who is a licensed tax expert. Routine accounting work that covers payment of bills, recording of day to day transactions, issuance of billing statements to clients, can be done by a bookkeeper or by you, if you have a basic understanding of accounting terms and terminologies.

A good accountant for you, is someone who has vast experience in your line of business and the necessary expertise in the accountancy profession. He is someone who understands the intricacies of the industry, and can help you not only with your books of accounts but in coming up with strategic business decisions. These would include - make and buy decisions, investment strategies, product development, and computerization, among others, to keep your company competitive in the market.

Start-up operations without professional help can proved more costly in the lo...

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...ffect on small business health care tax credit and reportorial requirements that are needed from employers. These reports indicate cost of coverage and employer sponsored health plans. Other changes would include revisions in Net Investment Income Tax, Medicare tax, and health coverage of insurers. The tax implication and changes in present and future regulations would be better understood by practicing Accountants who are well versed in this field.

Professional accountants would also be in the best position to advise you on the right accounting software for your business. You can discuss with him the type of software that is a best fit for the kind of operations that you do. As somebody who is up-to-date with his profession, he is the best person to advise you on changes in accounting practices that would have direct impact on your specific line of business.