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

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Edmonton Accountant | The Cost Of Accounting

One of the most important decisions that an entrepreneur can make in their business says Edmonton accountant is hiring the right accountant in their business. Many business owners don’t understand the importance of hiring a great accountant, but since they will be able to help the business owner minimize the amount of taxes that they will pay in their business, and that taxes is one of the largest expenditures that an entrepreneur will pay, this can take a pretty big difference in the entrepreneurs business. As a Red Adair, a specialist in extinguishing and capping oil well fires once said, if you think it’s expensive to hire a professional to do the job, wait until you hire an amateur. Since 50% of all entrepreneurs close the doors to their business before they’re in business for five years, and 29% of them say that they ran out of cash as the reason they failed, being able to minimize costs wherever possible can make a huge difference to the statistic.

The first thing that business owners need to understand when they are looking at accountants to hire, is that they will never be able to get a price for their accounting services over the phone. Not only are accountants not allowed to give prices to clients without having a complete understanding of their business, it’s also not a good idea. There is no way that any accountant will be able to accurately give a price on and accounting service without understanding the business, and what type of accounting services they need says Edmonton accountant. Business owners should be ready to answer questions such as are they planning on growing the business, or perhaps selling it? Are there any challenges the business owner is facing, or any big changes that have happened in the past year, or about two? Is it being audited? Also, the business owner will need to answer questions about how much revenue it generates per year, how many employees they have. Once the accountant understands the business much better, they will be able to give a quote that’s much more accurate and complete.

Once they get a price from an accountant, business owners should understand the three ways that accountants charge for their services, in order to choose the one that works best for them says Edmonton accountant. Each method has its own drawbacks, in the business owner should be aware of each of them, so they can choose accountant that has the billing strategies that work best for them. The first way says Edmonton accountant, is the most common way which is being paid by the hour. The next way is less common, is a flat fee per service, for example one price for a year and. And the last way which is the least common, but most advantageous for both the business owner and the accountant, is a flat monthly fee, where all of the work that an accountant does for a client, is covered under one monthly fee that stays the same for every month.

Business owners can do their business a great service, by hiring the right accountant to work with says Edmonton accountant. The reason for this, is because great accountants can make a huge impact in the business, not just on their finances, but most specifically on their tax planning. Since taxes can end up being the biggest expense the business owner faces throughout their entrepreneurship, having an accountant that can help them keep their expenses low by helping them pay is minimal taxes as possible, can have an extremely huge effect on a business. Since 50% of all business owners close the doors to their business within five years, and that 29% of those failed businesses say that the reason they failed was because they ran out of money because of this, anyway that a business owner can minimize expenses, especially minimize the major expense of taxes in the business, can make a huge impact in their business. With that in mind, business owners should understand that hiring an accountant is much more important than they might have realized. Not hiring the right accountant, might mean business owners ending up paying more taxes in the long run, which not only could end up with business owners paying more in taxes, but could actually end up with them out of cash in their business and having to close their doors.

Business owners need to find an accountant that can do effective tax planning for them. The reason this is so important, is because not all accountants do planning. Many entrepreneurs believe that all accountants do all types of accounting, but most of them only do the services that they are comfortable doing, which means not all of them will take on planning says Edmonton accountant. And although CPAs may say that they do business planning, but they don’t do business plans that often throughout the year. They’re going to want to find an accountant that does many business plans a year, in order to end up with the best plan they can, in order to be able to effectively minimize taxes. Being mindful of this, business owners need to then figure out which accountants do planning the most. A good metric for business owners to use, is finding accountants that do about 100 business plans per year. That number ensures that not only do they do them, but they do them often, and probably do them extremely well says Edmonton accountant.

Once they find an accountant that does significant business plans per year, business owners should then make an appointment to go take a look and what those business plans look like. While business owners may not really understand what the document means just yet, they need to be satisfied that they are looking at a meaningful document. They should take note of the number of pages, and most importantly ask the accountant what the measurable’s are in order to determine if the business plan is working for you.