MONEY SAVING TIPS FOR SMALL BUSINESSES
Shari L. Coxford © 1997
Many small business owners are not aware of the money saving alternatives that exist to the traditional internal bookkeeper/external CPA firm. Commonly, a small business will employ one person to handle the receivables and payables, and sometimes the payroll as well. An outside accounting firm tops off the list by handling quarterly payroll tax forms and financial statements, usually at a very high cost that far outweighs the benefits a small business receives.
Personal consultations with your CPA firm to discuss strategies for improving your bottom line can cost additional thousands of dollars, a heavy toll on a small company that's still struggling to make their business profitable. Hiring an actual CPA as an employee will insure more personalized service, but is still not cost-effective for small businesses.
A viable alternative is to utilize an individual who offers complete bookkeeping and accounting services, very often a Public Accountant, at a fraction of the cost of the combined services of the internal bookkeeper/ external CPA firm. A Public Accountant (PA) generally has the same knowledge and skills of a Certified Public Accountant (CPA), minus the official certification. An individual who has worked for years as an employee and has learned complete bookkeeping, payroll and accounting services may decide to offer their years of experience to the general public rather than continue as an employee for one firm.
This alternative is especially alluring for service-oriented businesses that receive income on a sporadic basis or who receive income from only a handful of clients per day or week. Ideal candidates for a PA are businesses who don't utilize a cash register in their business or require that their register receipts balance with their actual cash every day.
Your Public Accountant can handle ALL of your bookkeeping/ accounting needs. They can come in as often as once a week if needed and handle your Accounts Receivable ledgers, Accounts Payable ledgers, and compute your payroll. They can write any checks needed, including payroll, from the checking account you already have. They write the checks, you sign them, they take care of the rest.
The Public Accountant can decide how your income will get divided up so as to ensure that all of your creditors remain happy, employees receive paychecks, and so forth, because they know how to set financial priorities. Of course it will be up to you, the business owner, to heed any advice they offer. Ignore their valuable advice at your own risk.
Quarterly, the Public Accountant can file your payroll tax forms. And they can prepare financial statements quarterly, semi-annually, or annually, as you deem necessary. A good PA can eliminate the need for an internal bookkeeper and external CPA firm altogether, at a fraction of the cost and with more personalized hands-on service.
A perfect example is an Atlanta company employing a full-time receptionist/secretary/bookkeeper at $10 per hour, and an outside CPA firm charging roughly $500 a quarter for financial statements and payroll taxes, plus an additional $2000 year for incidentals, at a combined yearly cost of about $28,880. They instead utilized a part-time (24 hours/week) secretary/ receptionist at $8 per hour and a Public Accountant for a combined yearly cost of about $20,000. That's a savings of $740 a month, or $8,880 per year! Ask the PAs that you interview to compute your overall savings for switching to their services.
The best way to locate a Public Accountant is in the Classified Ads in your local daily or weekly newspapers under "Accounting Services." You can also find Public Accountants listed in the Yellow Pages under "Accountants - Public." Talk to several and compare their prices. Ask for references from previous and current clients. You might also call their previous employers regarding their bookkeeping/accounting experience if their client list is small, which it will undoubtedly be. Work with them to tailor-make a bookkeeping/accounting package that fits your specific needs. One size does not fit all!
One final note regarding accountants: remember that your accountant works for you, not vice versa. You should feel perfectly comfortable with the accountant you hire. He should not give the impression that he is doing you a favor, that you are in any way ignorant or somehow beneath him, or that your business isn't worthy of more than 5 minutes of his attention. If you are in any way uncomfortable with your accountant, fire him and hire a new one.
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Shari Coxford is founder of the All Free Spot freebies web site, which
offers tons of free stuff at:
http://www.allfreespot.com
You may reprint this in newsletters and on Web pages as long as you
use it in its entirety, including this resource box with the author's
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traditional print media, please contact the author at:
Shari Coxford
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