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Samantha Speakes - 3/18/2024
At some point every small business will reach a point where the handling of accounting and the tax implications of the business begin to be too much for you as the business owner to juggle single handedly. When you've hit this state, we recommend the day to day bookkeeping as well as in depth accounting and tax filings be hired out to a bookkeeper AND a separate CPA. Getting you back to what you do best, growing your business!
What is a CPA?
A CPA is a Certified Public Accountant, in other words a highly skilled financial specialist who is licensed to provide accounting and tax services to business and the general public. We like to think of CPAs as the Navy Seals of the accounting world, the most specialized and highly trained, within an already specialized field. To become a CPA they must pass the Uniform CPA Exam, comply with state requirements and posses a bachelors degree with a minimum of 150 credits, alongside one to two plus year of public accounting work experience. It is a CPAs job to help business owners keep track of their business finances, including taxes and government filings. A CPA is also able to help with personal taxes as well.
What is the difference between a CPA, an accountant and a bookkeeper?
Where we think of CPAs as the Navy Seals of the accounting world, highly trained and specialized; they also aren't responsible for the day to day operations and details from within an organizations books. This is the role a bookkeeper fills. Bookkeepers are responsible for keeping track of all financial transactions within an organization so that records are kept update date and accurate at all times. Accountants are a bit of a middle ground between bookkeepers and CPAs, you'll regularly find accountants employed by one organization and those that aren't are regulated by professional associations. Accountants generally oversee staff of a single organization and a responsible for financial reporting to the organizations owner or board, as well as the organizations CPA for year end fillings.
What will a CPA do for my business?
Within the context of your business a CPA can:
Analyze financial records
Prepare annual financial reports
Conduct audits
Prepare and file tax returns
Assist in business decision making for big picture items
Financial consulting
What will a bookkeeper do for my business?
Within the context of your business a bookkeeper can:
Track cash, sales, and purchases
Post transactions to appropriate accounts
Manage and reconcile payroll
Prepare financial statements
Reconcile accounts receivable and payable
Generate invoices as necessary
Reconcile bank and credit card accounts monthly
Prepare financial records for CPA to audit, analyze and prepare taxes with
I have a bookkeeper, do I really need a CPA?
While we are all about keeping expenses low to increase your companies profitability and ROI, we always recommend that you employ a CPA annually to help you prepare and file your companies tax returns. Whether your company is small and keeps your own books in order or you have a bookkeeper as part of your team; a stellar CPA will save you money on your taxes in the long run year over year. At Browne Bookkeeping we HIGHLY recommend having a CPA, as an example; we will prepare your financial records and work with your CPA to ensure they have everything they need to audit, analyze and prepare your tax returns. They are your tax professional; licensed and with continuing education to allow them to file your taxes with the utmost knowledge and expertise required to navigate the ever changing world of the IRS.
We recommend that your bookkeeper and CPA be separate entities, to ensure checks and balances stay in place and allow for a second set of eyes on your books; which will help ensure all items are coded and audited correctly; resulting in the most accurate tax filings and financials for your company.
Still have questions; we are here to help answer them!
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