Regardless of your business being a small scale or a large scale, you need a professional accountant, who could advice on your business plans and tax related issues. You need an accountant for budgeting and to foresee financial scenarios.
How do you choose the right person for your organization or business? You need to ensure that they provide the services pertaining to audit, financial accountancy, tax, bookkeeping, payroll, tax rates, and many others.
Before hiring an accountant you must ask the representative a few questions, which could help you to get the right person for your business.
Let’s see what those questions are:
1) What qualifications do they have: This is the most common and an important question you need to ask him or her? Yes! Qualifications do matter a lot when you are hiring an accountant. On the basis of qualifications you can get an idea about their knowledge in the same field.
2) Work Experience in the accounting field: Experience is also one inevitable factor. More experience means more knowledge. If you are really looking for an ideal accountant for your company, you will require a person who carries minimum 5 years of experience in this field.
3) What do you know about breakeven point and why this is important? The breakeven point is the level where the company has not booked any profits or losses. It is very important to measure, because you can estimate the level of your business. If the breakeven at the lowest level determines profit margins, you can get an idea how much low price you can offer.
4) How can I improve my Business cash flow: You have just started a new business, and it can be extremely difficult to manage your business if your cash flow is not flexible enough. First of all, you need to understand the payment cycle of your customers. Check how long it can take your customers to pay you.
5) What is accounting equation or the balance sheet: A good accountant could only explain the balance sheet in proper manner. Ideally he or she will tell you the equation is assets= liabilities +equity, a balance sheet has liabilities, assets and equity. It is mandatory tool for anyone who is in the business.
6) What do you know about cash or accrual basis reporting? Which one is better: Only an accountant expert could explain you that accrual basis accounting brings better financial reports, where as cash basis accountings are usually work upon taxes.
7) How to reduce my expenses without compromising with the quality and services?: You don’t know about your expenses and want to control that. Check out how much money you spent on advertising the product, on employees, phone bills, internet service providers, software and shipping company. In this way, you will get idea where you can cut down the expenses.
8) Which software suits your business needs?: This is the question where you will actually come to know about accountant’s knowledge. This helps in knowing if the accountant is aware of the recent business application tools and software. .
9) What if I get a tax audit request and what are the steps to be taken?: Your tax returns are examined by IRS (Internal Revenue Service). If you are being audited you must know what rights do you have and it is important for you to know the year when you are being audited.
10) Do you know about “inventory funding”? How is it beneficial to my business?: Inventory funding is a line of credits or short term loans that are made to a company for purchasing the products on sale. Inventory funding could prove to be very useful. In addition to the inventory financing loan, your business will be able to utilize early pays and discounts with dealers and customers.
Mathew Barkley is a CPA who advises people on accounts, tax preparation VAT, PAYE and tax calculations. She is specialized in accountant bookkeeping, Tax returns issues. If you are looking for accounting outsourcing services, you must contact GC Accountant services.
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