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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 Differences Between An Accountant And A CPA

When business owners are now in their entrepreneurship, CFO services says they often do not understand what to look for when hiring an accountant for their business. The reason why it is so important is that the failure rate for businesses is so high, with half of all Canadian entrepreneurs fail in within five years. How an accountant factors into this, is when an entrepreneur has a great accountant, they can end up with a business plan that can help them address the three most common reasons why businesses fail so that they do not fall victim to the same problems. Also, a great accountant is going to be able to give them great tax advice, that they will be able to use to increase the cash flow in their business, and increase their wealth significantly. The right tax plan can help an entrepreneur save thousands of dollars a year in their business. Therefore, it is very important that entrepreneurs learn early on what they need to look for in an accountant to ensure they end up with the best one for their business.

CFO services recommend that entrepreneurs always use a designated accountant. Ultimately, the professional designation means that these accountants have gone through even more rigourous schooling, about double that of a typical accountant undergraduate degree. This means they have double the experience before they start practicing, which can be extremely valuable.

Not only is the amount of experience important, but so is the quality of the experience that they get. Accountants going through the CPA program will have to work in a CPA designated and approved accounting firm. This type of experience is extremely important because it will give them practical experience that they lacked in the undergraduate degree. In addition to working for forty hours a week, these students also have to continue doing courses in the evening and the weekend outside of their accounting workday. This coursework is designed to replicate real-life accounting situations, so at the end of three years, they have had more than full time experience gaining practical knowledge including business and tax plans.

In order for business owners to be able to hire an accountant that has their designation, business owners need to ensure that the name of the firm has CPA, chartered professional accountants in the name of the firm. CFO services says that there designations that could be included in the name of the firm that means they are a designate accountant, including LLP, professional association, CA, CMA, or CGA. The looking for these letters, business owners can be certain that their accountant is a designate, and has a great amount of experience, and knowledge.

By being aware of what a designate accountant is and why they are extremely beneficial to businesses, entrepreneurs can hire the right accountant for their business, that will help them end up with a great business plan to help them succeed, and a great tax plan that can help their business financially.

CFO services | The Differences Between An Accountant And A CPA

One of the biggest mistakes that entrepreneurs could make in their business, is hiring an accountant that is inexpensive to meet their budget says that CFO services. While entrepreneurs need to save their money very aggressively early on in their entrepreneurship, there are some things that they should ensure that they are never paying the lowest possible price on for quality reasons. One of those things is an accountant. The wrong or inexpensive accountant can end up costing an entrepreneur far more than money. As Red Adair, the professional who specialized in extinguishing and capping oil well fires has said, ìif you think it is expensive to hire a professional, wait until you hire an amateurî.

One of the reasons why accountants would have a lower hourly rate, is because they have less experience says CFO services, or they have less education. A non-designated accountant is lacking about half the education that chartered professional accountants have. Therefore, they charge a lower hourly rate. When entrepreneurs who are budget conscious hire that accountant because of their hourly rate, they may end up with a bigger problem. Since they lack the practical experience that chartered professional accountants have, they may take far more time on the financial statements of the business. So while they have a cheaper hourly rate, they take more time to do the job, and an entrepreneur ends up with a higher monthly bill.

Another way that entrepreneurs can harm their business by hiring the wrong accountant, is non-designated accountants lack the practical experience and are unable to efficiently tax plan for businesses. This ends up costing an entrepreneur thousands of dollars a year in taxes that they are paying that they would not have to otherwise pay if they had the right accountant in their business. What this can do, is affect the cash flow of the business, affect how much money the business can save and put towards asset purchases, and as well affect how much money the entrepreneur can take out of their business, and either used to live on, or save for their future. CFO services says that these things can significantly and negatively impact a business and the business owner as well.

When entrepreneurs are looking to hire the right accountant in their business, they should ensure their hiring a professional who is going to be able to help them grow, and get their finances done efficiently and in a timely manner. Rather than hiring based on the most inexpensive hourly rates, entrepreneurs should actually look for the chartered professional accountant that they feel they can trust best. Even if they have to spend more money per hour and per month on their services, is going to be able to positively impact their business so much, that it is worth the extra bit of money that entrepreneurs are going to have to pay to get that level of knowledge.