Having a good CPA is essential to the success of your business. To get the most from your CPA, it’s important to understand what they are good at and what they are not.
Most CPAs are very good with taxation. This includes tax planning, preparing tax returns, and dealing with the IRS. If their practice includes compiling financial statements and financial auditing, they are also good at understanding the requirements of financial disclosure. This includes presenting financial information in accordance with Generally Accepted Accounting Principles (GAAP).
Your traditional CPA is probably not the best person to help you with the Chief Financial Officer (CFO) function or for the management of your Finance Department. the reasons are because traditional CPAs generally do not specialize in this area, and their profit model is centered on tax returns and certified audits.
But your CPAs love working with someone who has a background in public accounting because such a person understands what they do and need. This person can give them everything they need on a silver platter, which makes their job of preparing tax returns and giving opinions on financial statements much easier. Additionally, your CPA many not be permitted to prepare or alter the financial information upon which they rendering an opinion. In these cases, it becomes essential to have the help of a qualified part-time CFO who has a background in public accounting.
To get the most out of your CPAs, be clear on what they do best and then have them do it. Have your regular CPA do your taxes, compilations, reviews and audits. If your business needs the CFO function, hire a qualified part-time CFO, preferably one who holds a CPA certificate AND has had hands-on CFO experience.
To learn more, visit www.CfoOutsource.com.