Accounting solutions: Which ones makes the most sense for you
Let’s say for a moment that you run a business. Either you own it, or maybe you operate it. Either way, you know that your accounting is one area where you can’t afford to make mistakes.
If you don’t have someone competent crunching the numbers when tax time rolls around, that’s going to be an issue for you. You could miss out on a few of the deductions you can take, and on top of that, the IRS might audit you if they discover significant irregularities.
You might even need an accountant at other times, such as if you want to borrow money and you need to come up with an accurate business wellness report to present to a bank, credit union, or independent investor. Whatever you need the accountant for, though, you’ll have to decide between two basic options: whether you want to hire one exclusively and keep them on the payroll at all times, or whether you’d prefer to have one handy that you only use infrequently.
Let’s discuss some pros and cons with either of those options.
Hiring a fulltime accountant
When you’re looking at various accounting solutions, hiring a full-time accountant and having them on your payroll at all times seems ideal in some ways. Whenever you need someone to crunch those numbers because you need a financially-related answer as to how your business is doing, they’re right there, and you can simply give them the assignment.
The real problem if you go this route is that if you have an accountant as a full-time employee, you have to pay them accordingly. There are certainly plenty of skilled accountants who would abandon a private practice if it meant steady work for one company. To lure such an individual to work for you, though, you would probably have to offer them things like good wages, a 401K plan, healthcare, stock options, and whatever other perks you can afford and which seem appropriate.
You’ll have to look at whether you can afford one or not, but you’ll also have to think about how much work that’s in an accountant’s wheelhouse you’ll have at all times. If you’re a large company with a more complicated business plan and methodology, that’s when you’ll probably want a full-time accountant. If you’re going to hire someone full-time, and then they’re sitting there twiddling their thumbs for weeks on end, that’s pointless.
Using an accountant only as needed
The other option is to only use an accountant when you need one. You might have a preferred individual who you trust and that you sometimes use, but they’re not a full-time employee.
The most obvious benefit if you do this is that you can save some money. You won’t have to offer all of those benefits that we just mentioned.
There are some definite drawbacks, though. If you don’t have an accountant on staff at all times, then if you have an issue with which you need them to deal, then you can call your normal person, but then you’ll have to take the time to catch them up on what’s happening and why you need help. Maybe they have some idea about your financials if you’ve hired them in the past, but probably they won’t be entirely up to date, and they’ll have to take some time to place catchup.
Also, there might be times when your preferred accountant is not readily available. If they don’t work exclusively for you, then presumably, they have other clients that give them work so they can stay in business.
You might need to wait many days or weeks until they can pay attention to you and whatever issue you’re having. You might not actually be able to wait that long. Perhaps you’re trying to rope in a new investor, and they don’t want to bother waiting until your preferred accountant can weigh in on why your company presents such an unmissable investment opportunity.
How can you choose?
You don’t have to decide in either direction right this second. If your business is doing okay at the moment, then you probably don’t have a pressing need for an accountant.
At some point, though, if you want to expand or are already growing, you’ll likely cross a line where you can no longer get by without a full-time accountant on staff. Eventually, if the company gets too big, you’ll want someone there constantly to help you in this critical area.