Why Small Businesses Get Big Benefits from Enlisting Outside Accounting Service
By Steve R. Harless, CPA
Small business owners like restaurateurs or retailers set up shop because they love food, clothing, birdhouses or whatever items they happen to carry. These folks do not typically go into business because they harbor a secret desire to spend hours pouring over spreadsheets and filing taxes. Thus, almost any small business owner will find much benefit in working with an outside accounting firm. Not only can the accounting team handle bookkeeping, recommend software and train staff to use it and help with everything from inventory tracking to tax reporting, but working with an outside accounting firm will force internal staff to be more accountable. This could result in avoiding pitfalls like embezzlement, waste and disasters at tax time.
For small business accounting, the easiest and least expensive software is QuickBooks, which is flexible for all types of businesses. For larger businesses, Microsoft Dynamics GP is a good choice. Software training is the next step because a package is only effective when used properly. If you put bad information in, you will get useless information out. Common small business mistakes include not reconciling the bank account or not properly costing the inventory, for example receiving inventory into the system but not selling it through the system. Business owners will often let the bookkeeping slide because truthfully, they hate it. Receipts, paperwork and invoices get thrown into a box and tax time turns into a nightmare.
With the help of a small business accounting firm, ongoing bookkeeping and accounting are handled without fuss, and everything gets easier. By using the software correctly, the business owner will even be able to receive helpful reports that can provide an accurate picture of what is going on with the company financially. They now have a tool to help them manage their business, and this will benefit the bottom line. For example, a restaurant will obtain a true cost of sales for each menu item and learn which ones are actually making the most money.