Making the decision to hire an accountant is an important step for your business. It means having someone dedicated to running the company financials and following laws related to taxes that may be specific to your industry. There are industry standards that can play a large role in the success of your accounting department. We have CPAs our our team who specialize in real estate, dental, fitness, and tech services to name a few.
A competent bookkeeper or CPA will help you in effectively tracking income and expenses. They can also provide critical reports that will give you insight regarding how your business is performing, what could be improved and how close you are to reaching goals. CPAs can take the data entry portion of this to the next level by providing assistance with business decisions, becoming an advisor and true partner you can rely on for accurate and informative information regarding your company’s finances.
You may have been looking at hiring a bookkeeper by running a local ad, but is that really the best strategy?
CPA vs. Bookkeeper
The decision to hire a bookkeeper or a CPA really comes down your business needs and goals. (Please see our 8 reasons why you should hire an accountant for more info) Finding the right fit can be tricky, and it’s important to explore a wide variety of avenues to find the right person for your team. Craigslist and other job boards can be an inexpensive way recruiting method, but you must do due diligence in your hiring process if you choose this avenue as opposed to a referral from a colleague or friend. For example, we have a thorough hiring process that tests specific accounting knowledge, accuracy, proficiency in accounting software, etc. It can be difficult to test these things if you do not have an accounting background.
Difference in Cost
There is a large difference between a bookkeeper and a CPA in levels of training, education and experience. This is translated to the difference in cost as well. Generally speaking, a bookkeeper will earn anywhere from $20 – $35 per hour whereas a CPA will charge $150 – $350 per hour. It can be a great symbiosis to pair a CPA and bookkeeper if both are competent and can communicate with each other. The bookkeeper may complete all of the day-to-day or monthly duties while the CPA can review the books on a monthly, quarterly or annual basis. By hiring a knowledgeable and experienced bookkeeper and/or CPA, they can save you hundreds to even thousands of dollars a year with deductions you might not even know existed.
Hiring a Bookkeeper
It can be difficult to navigate the world of accounting if you are not familiar and hiring someone to fill the position can feel overwhelming if you don’t know what to ask. (Get familiar with what our CPA and Bookkeepers need to qualify). Here are four questions to ask a potential accounting partner:
- Are they familiar with your accounting software? A certification in QuickBooks or other accounting software can be a great place to start.
- Do they have client references? Speak to other or previous clients of theirs and ensure that they are or were happy with the bookkeeper’s work before hiring them.
- What degrees, qualifications and courses have they completed?
- Do they subscribe to industry news? They should also be able to tell you about any subscriptions or memberships they have to AICPA, their local CPA affiliation and any industry-specific news to show that they are up to date with law and regulation changes.
Ultimately, the long-term goals and current challenges of the business help in making the decision of whether a CPA or bookkeeper is needed. If the business is new and you need assistance managing data entry or someone to look over your accounting reports, a bookkeeper will probably suffice. But if you have any questions about how your entity should be structured, i.e. LLC, S-Corp, etc., or would like to get some tax planning advice, a CPA is best suited to help guide you through higher level business decisions so you may reach your goals. If you still have further questions we would love to answer them with a free 30 minute consultation.