Another busy tax season is in the books. You’re probably tired of even talking about the subject, but having a great accountant as part of your team of advisors is critical to success as an entrepreneur.
My friend and colleague, Phil Symchych, President of Symco & Co., recently gave these words of advice on finding a great accountant in his weekly business blog, Business Success for Life.
A great accountant:
- Provides you with proactive business advice, not just historical financial statements and compliance tax returns.
- Makes introductions to his or her professional network, such as a banker, lawyer, insurance agent, and others who can help you with your business.
- Gives you a structured accounting system that shows your gross profit by product and service line.
- Is highly accessible to take your calls, responds quickly, and isn’t overwhelmed with a high volume of low value personal tax returns.
- Educates you on the importance of cash flow, profit, and building equity.
- Explains how to use your financial statements as a monthly management tool.
- Doesn’t minimize your taxes at the expense of building equity to fund future growth, because increasing profit is more important than decreasing taxes.
- Asks you questions instead of just answering your questions.
- Shares ideas from other industries and businesses.
- Doesn’t charge by the hour or the minute.
- Doesn’t have files piled all over the floor.
- Focuses on maximizing your profit and after-tax cash flow.
- Practices what he or she preaches, is happy, treats staff members well, and has a thriving business.
- Has happy, profitable clients who are growing their businesses, paying their taxes, and building wealth.
Phil’s bottom line: a great accountant will work proactively to structure your business for long-term success. Like any important relationship, however, this success is based on two-way communication and mutual respect.
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This is fantastic Bill. Thanks for the repost. One thing I’d add to the list is bookkeeping services. I have found it invaluable over my first several years in business to be able to send my payables and credit card statements en masse each month and have the accountant tackle the chart of accounts and payments on my behalf. Some accountants are shy about that kind of trust relationship, but if an entrepreneur can find one to do the whole nine yards, it is well worth it. More time to focus on growing the income side of the profit equation. Of course, the old adage rings true, “Trust, but verify.” Monthly review of the P&L as well as periodic review of bank statements is still important.
You’re right, Chris, good to have everything in the same place. In my business we do some of the bookkeeping internally and have our accountant double-check it. Some clients do this for payroll and it saves them a little money. The bottom line, though, is to make sure you have a robust working relationship with this professional and not to be intimidated by him/her.