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E-Myth – “Why most small businesses don’t work & what to do about it”

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CFO Services | The Difference Between CPAs And An Designate Accountants

Hiring the right accountant early on in a business is one of the keys entrepreneurs can use to succeed says CFO services. Since 50% of all Canadian businesses fail, there are three main reasons why these businesses say that they were unsuccessful. They ran out of money, they cannot find customers for their business, or they are unable to hire the right team. Not only can chartered professional accountants help entrepreneurs with all of those things, they can also help an entrepreneur save money by creating an efficient tax plan. All business owners need to know, is how to find a chartered professional accountant, that can help them with those things.

The reason why entrepreneurs should be looking for chartered professional accountants, and not undesignated accountants, is because they differ in schooling between the two. Many entrepreneurs are surprised to discover that anyone that has an undergraduate degree can call themselves and accountants. However, CFO services says that chartered professional accountants do twice the schooling that undesignated accountants do. They will continue with their education after their undergraduate degree, getting a job in an approved chartered professional accounting firm, and apprenticing with this CPA. While they are working for three years full time in an accounting firm, they will also be completing additional coursework and tests in their spare time after work and on the weekends. The coursework is going to be designed to replicate real accounting situations, and along with working with real entrepreneurs on their files, under the guidance of a CPA CPAs are gaining lots of practical experience, head and shoulders above undesignated accountants.

Therefore, when it comes to efficient tax plans, business owners should understand that chartered professional accountants are going to be able to give them the best tax plan possible, even over accountants with their undergraduate degree. It is extremely invaluable as an accountant is creating an efficient tax plan that they not only know the theory behind the income tax act, that they have applied it in their experience obtaining their CPA designation. CFO services says that this is extremely important for accountants to have, so that they can create the best tax plan possible, can help an entrepreneur save thousands of dollars or more each year.

Also, an experience chartered professional accountant is going to help an entrepreneur significantly create at the business plan that will help them not only avoid the typical reasons why entrepreneurs fail, but also help them create a marketing plan is going to help them succeed. The only way that an accountant is going to be able to provide a great, workable business plan, is if they have done it with entrepreneurs in real life already.

When entrepreneurs are looking to hire the best accountants they can, they should be hiring someone who has completed their CPA designation, because they will be able to use the practical experience they have gained to help an entrepreneur significantly and positively impact their business.

CFO Services | The Difference Between CPAs And An Designate Accountants

Business owners may unwittingly be hiring a designate accountant for their business says CFO services. One of the reasons is, they are not sure that there is a difference, and are trying to be very budget-conscious when they hire an accountant. They understand that their business has a very small budget, and end up hiring based on hourly rate, and not skill level.

The reason why undesignated accountants often have a lower hourly rate, is because they lack about 50% of the education that chartered professional accountants have. CFO services says that because they have not completed the CPA program, they lack practical experience, and they charge a lower hourly rate. Business owners should question why an accountant costs less than other accountants. Because they lack experience, they are often less efficient at doing the financials of the business. And while business owners think that they are saving themselves hundreds of dollars a year, they end up getting charged for twice the hours because they are inexperienced and do not know how to do things efficiently.

CFO services says that also, non-designate accountants often are not proficient with tax planning, because they lack practical experience. That ends up costing an entrepreneur thousands of dollars or more each year, because they do not have an efficient tax plan. This can negatively impact and entrepreneur’s cash flow in their business, as well as when they are able to take money out of their business. In order to have the best possible tax plan and save the most amount of taxes, entrepreneurs should look for a great chartered professional accountant, and take into consideration the larger hourly rate that they pay, will still pale in comparison to the thousands of dollars a year that they are going to save in taxes.

Business owners should look for accountants that indicate in their name that they are designate accountants, such as saying professional association or chartered professional accountants in the name of the firm. Also, firms that have any of the following behind the name will also mean that there designated accountants: LLP, CA, CPA, CMA, or CGA. If any of the accounting firms that an entrepreneur is thinking of hiring have those in their name, it is a great chance that those accounting firms will be able to provide great financial statements quickly and correctly, as well as help with efficient tax planning that is going to significantly help an entrepreneur increase the cash flow in their business, and save taxes.

Hiring the right chartered professional accountant is extremely important to entrepreneurs, and they should be aware that there is a difference between chartered professional accountant and an undesignated accountant. When they learned that, the low what to look for, and how to hire so that they are not paying thousands of dollars more a year then they should. Learning how to do this will significantly help entrepreneurs stay in business.