5 things to ask your accountant that will help you grow your business
Every entrepreneur needs a trusted accountant by their side to ensure the financial success of their business. If you only see your accountant at the end of every year when it's time to pay your taxes you are missing out on some of the most valuable insights that your accounting can provide. The right accountant should be a trusted advisor that provides you the entrepreneur with the data necessary for you to make critical business decisions.
Below are 5 five things that you should ask your accountant:
1. How much will I have to pay in taxes at the end of the year?
End of the year tax surprises is a headache that no entrepreneur wants to deal with. With the help of your accountant, they can help you forecast and plan so that you can provision funds for tax payments. A trained accountant will also be able to help you make decisions to lower this liability. Depending on your business there may be tax deductions and credits that can save you money if you plan and document that you're going to use them
2. How does my business compare with others in the industry?
An experienced and qualified accountant should also be able to provide you information about industry standards. This can help you benchmark your process and see if you're leaving money on the table. Is my payroll to high? Am I paying to much for rent? Are my margins what they should? These are all questions that a simple comparison to industry standards can help you judge.
3. Where is my cash being spent?
Your accountant should be able to provide you with detailed reports as to where your money was spent and if your company is actually producing cash. While your company can be producing lots of profit is it really producing sufficient cash to finance continued growth? It is not uncommon for companies to notice too late that they are growing broke. Things, like increasing Accounts Receivable or increasing Debt, could be signs that your company while making a profit cannot support its own growth.
4. How is my company performing compared to previous years?
Comparing how your business behaves year to year can help you make decisions about your business. This can unlock trends that can save you money, help you detect bottlenecks or other issues before they become larger. Are new process or policies generating the expected results.
5. Am I on track to meet our business goals?
Every successful entrepreneur should go through a goal setting process that provides them with a target for the year. Your accountant should be able to help you forecast if you are going to be able to meet those goals or to take action if it looks like you aren't going to meet them
A good accountant should become a trusted partner and advisor to any entrepreneur that is looking to be successful. Contact GBS Group if you need help answering any of these questions.