It may look like a Bookkeeper vs CPA battle, but the reality is very different.
As a business owner, it can be challenging to manage all aspects of your company, especially when it comes to finances. Many entrepreneurs may believe that having either a bookkeeper or a CPA is enough to keep their financial records in check, but in reality, businesses need both.
So, lets take a look at why your business may need both a bookkeeper and a CPA to ensure financial stability and success.
What is the role of a bookkeeper?
A bookkeeper is responsible for recording financial transactions such as sales, purchases, receipts, and payments. They are also responsible for maintaining accurate records of these transactions in the company’s books.
The role of a bookkeeper is crucial for a business as it enables them to keep track of their finances and generate financial statements. The financial statements that a bookkeeper produces provide valuable insights into the financial health of the business.
A bookkeeper’s responsibilities also include reconciling bank accounts, generating financial reports, and ensuring that the company’s financial records are up-to-date and accurate.
Why does my business need a bookkeeper?
One of the primary reasons businesses need a bookkeeper is that they help maintain accurate financial records. By doing so, bookkeepers can ensure that the company’s financial statements are up-to-date and accurate. This information is crucial for making informed business decisions, securing loans, and filing tax returns.
In addition to keeping accurate records, bookkeepers can also identify trends and patterns in the company’s financial data. This information can be used to identify areas where the company can improve and develop financial strategies to help the business grow.
A good bookkeeping firm will also be able to manage your payroll, including employee onboarding and offboarding and benefits administration.
A bookkeeper can also save time for business owners by handling day-to-day financial transactions. By doing so, business owners can focus on other aspects of the company that require their attention.
What is the role of a CPA?
A CPA is a licensed professional who can provide a broad range of financial services, including auditing, tax planning, and financial consulting. CPAs can provide strategic advice to help businesses make informed financial decisions and comply with tax regulations.
CPAs are also responsible for preparing and filing tax returns, which is essential to ensure that the business is compliant with tax regulations. They can also help businesses navigate complex tax laws and regulations and avoid costly penalties and fines.
In addition to tax planning, CPAs (as well as firms with a Financial Strategic Management expertise such as Estmere) can also provide financial consulting services. They can analyze financial statements to identify areas where the company can improve and develop financial strategies to help the business grow.
Why does my business need a CPA?
One of the primary reasons businesses need a CPA is that they can provide strategic financial advice. CPAs can analyze financial statements to identify areas where the company can improve and develop financial strategies to help the business grow.
CPAs can also provide tax planning advice to help businesses reduce their tax liability. They can help companies navigate complex tax regulations and avoid costly penalties and fines.
Another reason businesses need a CPA is that they can help ensure compliance with financial regulations. CPAs are responsible for preparing and filing tax returns, which is essential to ensure that the business is compliant with tax regulations.
By working with a CPA, businesses can also take advantage of any available tax benefits. CPAs are knowledgeable about tax laws and regulations and can help businesses save money on taxes.
So I need both a Bookkeeper and a CPA?
Now that we have established the roles of a bookkeeper and a CPA, let’s discuss why businesses need both.
1. Delivering accurate financial records as well as providing strategic financial advice.
While bookkeepers are responsible for maintaining financial records, CPAs and firms with separate Strategic Financial Management capabilities (such as Estmere) provide strategic financial advice. By working together, bookkeepers and CPAs can ensure that the company’s financial records are up-to-date and accurate, and the business is making informed financial decisions.
2. Ensuring compliance.
Bookkeepers and CPAs work together to ensure compliance with financial regulations. Bookkeepers are responsible for recording financial transactions and ensuring that they are accurately recorded in the company’s books. CPAs are responsible for preparing and filing tax returns and ensuring that the business is compliant with tax regulations.
Bookkeepers can also report and administer operating taxes, such as Sales and Use Taxes, State Taxes and Payroll taxes.
By working together, bookkeepers and CPAs can ensure that the company is compliant with financial regulations, reducing the risk of costly penalties and fines.
3. Saving your business money.
By working together, bookkeepers and CPAs can help businesses save money. Bookkeepers can identify areas where the company can improve and reduce costs, while CPAs can provide tax planning advice to help businesses reduce their tax liability.
By taking advantage of the knowledge and expertise of both bookkeepers and CPAs, businesses can save money and improve their financial stability.
4. Helping your business grow.
By working together, bookkeepers and CPAs can help businesses grow. Bookkeepers can identify trends and patterns in the company’s financial data, while CPAs can provide strategic financial advice to help businesses make informed decisions.
By taking advantage of the knowledge and expertise of both bookkeepers and CPAs or Virtual CFOs and Strategic Financial Management firms, businesses can develop financial strategies to help them grow and succeed
In conclusion, businesses need both a bookkeeper and a CPA to ensure financial stability and success. Bookkeepers are responsible for maintaining accurate financial records and identifying trends and patterns in the company’s financial data. CPAs provide strategic financial advice, ensure compliance with financial regulations, and provide tax planning advice.
By working together, bookkeepers and CPAs can ensure that the company’s financial records are up-to-date and accurate, reduce the risk of costly penalties and fines, save businesses money, and help businesses grow and succeed.
