While managing your business’s finances is important, it’s not something you need to do alone. A professional accountant can be worth the expense by helping you navigate major financial decisions, plan for tax savings, and overcome financial hurdles. When working with an accountant, asking the right questions can help you maximize the value of his or her professional experience and knowledge. Trusted financial planner Jan Gleisner shares 7 important questions to ask an accountant.
1. What Is My Business’s Break-Even Point?
A professional accountant can analyze many metrics to help you understand whether your business is turning a profit or a loss. By understanding your break-even point, you can determine the profitability of your business, an effective pricing structure, and how many hours of service or products you need to sell.
2. Can You Help Me Manage My Cash Flow?
Maintaining a positive cash flow is one of the greatest challenges of any small business, but it’s a skill that must be mastered. Your accountant can help you determine areas where you can make improvements, plan ways to manage your cash flow, and prepare detailed flow projections to help you get through shortfalls, which may also include cash flow tendencies you haven’t noticed.
3. Are the People Working for Me Independent Contractors or Employees?
There are important differences between employees and independent contractors. With employees, you’ll be responsible for withholding, remitting, and paying payroll taxes. If a worker is misclassified, taxes may be paid incorrectly and you could face IRS penalties.
4. What Types of Records Should I Keep?
Business records are necessary for filing taxes, measuring profitability, securing financing, and more. Your accountant can help you understand which records your business will need, such as employee wages, records of the purchase and sale of business assets, revenue, and operating expenses.
5. Are There Special Considerations for My Industry?
Depending on your industry, there may be unique accounting issues to consider, such as tax credits, sales tax exemptions, industry-specific grants, subsidies, regulations, deadlines, and more that could impact your business. Common examples of industry-specific tax concerns include the food tax for the restaurant industry and freight tax for shipping companies.
6. How Can I Guard Against Theft?
Theft may not seem like a top concern to discuss with an accountant, but the Association of Certified Fraud Examiners reports that the average fraud loss by small businesses is around $200,000 per year. An accountant can help you set up controls to detect and prevent theft from many sources, such as fraudulent billing schemes and employee theft.
7. Are There Any Changes I Can Make to Help My Business?
While an accountant isn’t necessarily a financial advisor, he or she can help you assess the financial information you collect about your business to make smart changes. Your accountant can help you plan for the future and fine-tune your operations to grow your business and meet your goals.
The top financial advisors San Diego has to offer can answer your most important questions related to your finances. If you need the help of a reliable financial planner, contact Jan Gleisner today at 858-337-2385.