An accountant works closely with other professionals, such as lawyers, auditors, bookkeepers, and others. He prepares reports and provides advice about how to manage financial matters better. An accountant advises businesses on ways to improve profitability, and he helps clients set up tax returns.
Accountants are required to hold an accounting degree. Many employers prefer candidates with experience in public accounting because it gives them insight into the workings of government agencies. Other fields include taxation, computer science, management consulting, and investment banking.
The Bureau of Labor Statistics projects growth in employment opportunities for accountants. Employment of accountants is expected to grow 13% over the next decade, much faster than average.
14 things you probably didn’t know a CPA could do
Accounting is one of those subjects people think about once every decade. They might learn it in high school, college, or even graduate school. But most people don’t consider becoming an accountant until they are already established in their career. And when they finally decide to become an accountant, they often choose to work for a firm rather than starting out on their own. Why? Because accountants make good money, and there aren’t many jobs where you can earn six figures while working less than 40 hours per week.
But what exactly does an accountant do? What skills do they need? How long does it take to become a certified public accountant (CPA)? Here are 14 things you didn’t know an accountant could do.
1. Help You Manage Cash Flow
An accountant can help you plan how much money you need to spend each month. This includes setting up budgets, forecasting future expenses and revenues, preparing tax returns, and much, much more. If you want to avoid running into financial trouble later in life, an accountant will find ways to cut down on unnecessary spending.
2. Find Ways To Reduce Costs
An accountant can help companies save money. For example, he or she can look over invoices and contracts to identify potential areas of waste. He or she can also find ways to streamline processes and eliminate redundancies. In addition, an accountant can spot opportunities to lower overhead costs and increase profit margins.
3. Prepare Tax Returns
1. Launch a startup
Accountants are great at helping people launch startups. They know what’s happening in the market, and they can help entrepreneurs figure out how much money they need to raise.
But there’s one problem: accountants aren’t typically good at getting venture capitalists interested in investing in startups. So, many entrepreneurs end up raising capital without accounting advice.
That’s why we asked our friends over at StartupLadder to tell us about the best accountants they know for startups. Here’s what they had to say:
#1. Launch a startup
The best accountant I’ve ever worked with was my dad. He helped me start my first company when I was 19 years old. He knew everything about starting a business, including how to structure it, where to find resources, how to write contracts, etc. My dad even did my taxes for free because he wanted to make sure I got every penny possible.
I’m still working with him today, and he continues to be a huge support system for me. If you’re looking for someone to help you set up a business, look no further.
#2. A good accountant makes things easier
2. Help with business strategy
An accountant helps you define your overall financial picture and set goals. They will provide you with metrics and data to measure your progress toward those goals. If something goes wrong, accountancy can help you identify the root cause and fix the problem.
3. Fix your cash flow
Cash reserves are a great way to protect yourself against financial emergencies. They allow you to pay bills without having to sell anything. If you do run into trouble, however, it might take longer to recover because you won’t have access to your savings account. You’ll want to make sure that you know exactly what types of expenses you can afford to pay off with cash reserves.
A cash reserve gives you enough money to cover unforeseen expenses like medical bills, car repairs, or even a vacation. This type of cushioning allows you to avoid dipping into your emergency fund.
You can use a spreadsheet to forecast your monthly income and expenses. Then you can calculate your monthly cash flow. Your goal is to ensure that you never fall short of your budgeted amount.
If you find that your cash flow isn’t covering your expenses, you could be overspending on things that aren’t necessary. For example, you could be spending too much on eating out every day. Or maybe you’re paying too much interest on credit cards. By identifying where you’re wasting money, you can start saving money.
4. Listen and support you
Accountants are often seen as boring, unemotional people. But there’s a reason why accountants are called “accounting gurus” – they know how to listen and support businesses. Here are four ways accountants can help businesses grow.
1. Provide emotional support
When it comes to accounting, emotions run high. Businesses can feel overwhelmed by the amount of work involved, and sometimes even the smallest mistakes can send a business into a tailspin. An accountant can offer emotional support to business owners, helping them make sense of what’s happening in their business. They can help them see things from a different perspective, and make sure their business isn’t being unfairly targeted.
2. Give advice on financial matters
Business owners don’t always understand the basics of finance, such as cash flow and profit margins. An accountant can explain the concepts behind numbers, giving business owners the confidence to take charge of their finances. They can also advise on tax issues, such as whether a business needs to pay corporation tax, VAT, or both.
3. Be a sounding board
An accountant can be a sounding board, offering feedback and suggestions about the way a business operates. This could include asking questions about processes, procedures, or policies. Or it might mean suggesting improvements to marketing campaigns or social media strategies. By listening carefully, an accountant can spot problems early, saving money and improving efficiency.
5. Manage your debt
Debt management is about finding the best way to pay off debts. There are many different types of debt, including credit card debt, car loans, mortgages, student loans, and personal loans. You might want to consolidate your debt into one loan, or use debt settlement to reduce interest rates. An accountant can help you make decisions about how much debt you owe, what type of debt it is, and where you can find the best deals.
Accountants can help you determine whether borrowing money is better than investing it into your business. If you do choose to borrow money, you’ll need to consider factors like interest rates, fees, tax implications, and repayment terms.
A good accountant will take a holistic approach to looking at all aspects of your financial situation. They’ll review your income and expenses, compare your current situation to previous years, and analyze your cash flow. This helps them understand the impact of changes in your spending habits, taxes, and investments.
6. Deal with unpaid invoices
Set up an automatic reminder system to remind clients about overdue payments. If you are owed money, it’s important to keep track of outstanding accounts receivable. This way, you won’t miss out on future sales opportunities. You could set up an online invoice management system like Invoice2Go, which allows you to send reminders to customers via email, text messages, phone calls, and even social media posts.
Debt financing lets them buy your uncollected invoices from you. When an account goes unpaid, debtors often try to pay off old debts first. However, many businesses don’t want to sell their invoices because they believe they still owe money to the client. But there are companies that specialize in buying invoices for cash. They give you the option to accept payment from the debtor or wait until they collect the full amount due.
Accountants can help you find solutions to problems related to unpaid invoices. Many small businesses struggle to manage their finances effectively. An accountant can help you identify areas where you might be able to improve your financial health. For example, he or she can look into whether your accounting software is giving you accurate information about how much money you are making and spending.
7. Write loan applications and try to sell them
Accountants are often asked to prepare loan applications. This article explains what lenders look for in a loan application, including things like income statements, balance sheets, cash flow projections and profit and loss statements. You’ll learn about the different types of loans available, and find out how to make sure you choose the best one for your situation.
8. Budget smartly
A detailed budget will give you insight into how much money you are spending each month. If you don’t know what your monthly costs are, it will help you plan ahead and save money.
The best way to start planning your budget is to sit down and write everything out. This includes every single expense you have. Think about things like rent, utilities, insurance, credit cards, etc. Once you’ve written everything out, look over your list and see where there might be places you could cut back. You’ll want to make sure you’re covering all of your bills and that you aren’t wasting money.
Once you’ve got your budget figured out, you’ll want to stick to it. It’s easy to spend too much money once you’ve already spent it. So, try to avoid buying anything unless you really need it. Also, keep track of your spending habits. If you find yourself spending more money than usual, it’s probably because you’re doing something wrong. Try cutting back on some of those unnecessary purchases and you’ll soon notice a difference.
9. Get you staffed up
Hiring someone is expensive, especially if you’re hiring remote workers. But there are ways to make sure you’re getting the best people for the job. Accountant Karen Linder explains how to hire the perfect employee.
10. Set up your software for accounting in the cloud.
Your accountant should provide you with a monthly report summarizing your finances. This includes a balance sheet, income statement, cash flow statement, and profit/loss statement. These reports help accountants understand how much money you’re bringing in and spending, and what type of investments you’re making.
Before the end of February 2019 you’ll want to set up your cloud accounting software. If you do it now, you’ll be eligible for some tax deductions. Here are five reasons why you should start setting up your cloud accounting software today.
1. You can access your data anywhere.
2. You don’t have to worry about losing your files.
3. You can make changes without having to reenter information.
4. You don’t have physical copies of important documents.
5. You can easily keep track of expenses.
11. Help you manage stock
Stock management is an important part running a successful business. You want to make sure you don’t run out of product, but you also want to keep prices low and avoid overstocking. If you use Excel spreadsheets to track your inventory, it’s easy for mistakes to slip through the cracks. An accountant can help you figure how much money you’re loosing through stock costs. And there are plenty of free online tools to help you automate your stock management process.
12. Use efficiency to make your business sing.
Business owners often make important decisions without thinking about the impact those decisions could have on the bottom line. A good accountant will take a holistic approach to reviewing your financial situation and recommend ways to improve your business operations. They’ll analyze everything from your accounting software to your spending habits to find areas where you’re wasting money. By implementing the recommendations, you can cut costs while increasing profitability. In addition, accountants can help you develop a strategic plan for growth that includes long-term goals and short-term objectives.
13. Use technology to its fullest.
The cost of doing business can rise rapidly. Things like storage, energy, employees and downtime can add up fast. But are you thinking about these costs strategically? How much does it really matter? And how can you make sure you’re getting the most out of your money? We asked some experts to help us understand what goes into running a successful business.
14. Bring some fun into your business – honestly
Accountants are changing. They’re coming from diverse backgrounds. And while many people still think of accountants as bookkeepers, they now work across a wide range of industries.
A good accountant can help you understand how accounting works in your industry and where it fits within your overall strategy. You’ll save money and time, and your business will run better.
But finding one isn’t easy. So we asked our readers about their experiences hiring an accountant. Here’s what they had to say.
How to find a great bookkeeper
If you are looking for a great accountant, it helps to ask around. You might already know someone who uses an accountant or has used one in the past. If you don’t know anyone personally, there are plenty of online resources that can help you choose the best match for your needs.
The most obvious place to start is with friends and family. Ask them what kind of accountant they use and why. Do they recommend any particular providers? What do they like about each provider? Are they happy with their experience? These questions can give you insight into how much value you will receive from working with an accountant.
Next, check out reviews of different firms. Look up ratings and read customer testimonials. This will help you learn whether the accountant offers quality work and provides good customer support. Some companies have a reputation for being better than others, while some are known for poor customer service.
Finally, look at the company itself. Does it seem reputable? Is it easy to contact via phone or email? How long has it been offering services? All of these factors can tell you something about the quality of the company.
Once you’ve narrowed down your list, take the time to compare the prices offered by each accountant. Accountants typically charge hourly rates, so make sure you’re comparing apples to apples. Don’t just go with the lowest price; you want to ensure that you’re getting the same level of service for less money.
When choosing an accountant, keep in mind that you’ll likely be dealing with them for many years. Make sure you feel comfortable with their personality and style. Will they be able to provide advice and guidance over the long term? Can they handle difficult situations without losing their cool?
Ultimately, you want to hire an accountant who fits your personal preferences and budget. By asking around, doing research, and making comparisons, you can narrow down your options and find the ideal fit.
Frequently Asked Questions
How can an accountant help your business?
Accounting is one of those things that most people don’t think about doing unless there is some sort of problem. However, it is important to understand that accounting is something that needs to be done regularly. If you want to run a successful business, you need to know where your money is being spent and where it is coming from. An accountant can help you with this process.
An accountant will work closely with you throughout the entire financial cycle of your business. You’ll receive regular progress reports and detailed analyses of your expenses and income. Your accountant will ensure that everything is running smoothly and that you’re making smart investments.
Is Accounting Important For Overall Cash Flow?
Accounting is essential for most businesses because it provides detailed information about how much revenue each product/service generates and how much cost goes into producing those products/services. Without this information, it’s difficult to make sound decisions regarding how to grow your business.
A good accountant can help you identify areas where you could cut costs to generate additional income. They’ll also provide advice on ways to improve processes and procedures within your organisation, such as increasing efficiency and reducing waste.
In addition, having accurate accounts can assist you in meeting tax obligations. If you’re self-employed, you’ll need to file Self Assessment Tax Returns every three months. This includes VAT returns and PAYE returns.
If you fail to meet these deadlines, you risk fines and penalties. So, it makes sense to outsource your bookkeeping to a professional accountancy firm like ours. We offer a full range of bookkeeping services including monthly statements, annual accounts preparation and filing, payroll processing, VAT registration and compliance, and many others.
We can also advise you on the best way to set up your business finances to maximise your chances of success.