Average Cost Of Accounting Services For Small Business

Shopping around for accounting services may seem overwhelming because of all the options available. It is important to choose a firm that is right for your needs. Whether you are just starting out, in the middle of growing your business, or making retirement plans, you need a team of accounting experts on your side that is ready to help you face the challenges that are distinctive to small business owners.

Difference In Bookkeeping And Accounting Services Rate

It is common for a small business owner to hire a bookkeeper so they can focus on the core of their services. However, a bookkeeper is limited to data entry. A CPA also analyzes the data and determines both business and tax strategies that can inform day to day operations in your business. The breadth of knowledge a certified Tax Coach possesses can greatly reduce your tax liability and increase your profitability.

How Much Does An Accountant For A Small Business Cost?

There are many factors that influence the cost of hiring a CPA. Some of these depend on the type of service you need and some depend on the expertise of the team you hire.

  • Find out how long the firm has been in business and talk to their current clients. Ascertain if they are a general accountant or if they have the expertise to address the specialized needs of small business owners.
  • Determine the type of service your business needs. You may decide that, in addition to the basic bookkeeping and tax preparation services, you need more advanced services such as strategic tax planning and advisory which will ultimately save you the most money and make your business more lucrative.
  • Not all accountants differentiate themselves as small business accountants. Choosing a firm that focuses on the nuances of owning a small business adds to the effectiveness of the tax planning time spent with them.
  • Accounting is no longer done with pen and paper. You need a firm who is tech savvy and protects your financial information online. The use of electronic communication can also minimize the time you spend away from the more important aspects of your day to day business.

Variables That Affect The Pricing Of Your Accounting Service

Your accounting needs are as unique as your business. These are some factors that are taken into consideration when assessing the price of your package.

  • Business Size: The number of customers, the type of transactions made, and the amount of annual receipts you have can affect the number of hours needed to properly manage your accounting needs.
  • Business Industry: Some industries can take advantage of more complex tax strategies than others which require more time. In the long run, these strategies typically save more money than it costs to implement them.
  • Accounting Tasks You Need: Small Business Accountants provide additional services such as benchmarking and comparisons of Key Performance Indicators that you may not be able to procure elsewhere.
  • Bookkeeping Methods: The more accurate, detailed, and up-to-date your bookkeeping is the less time your accounting team has to spend on these tasks.
  • Managing Your Books: While your family member may be willing to do the bookkeeping tasks, that may not be the best use of your resources. Why not trust the number experts who provide accurate recording as well as analysis of the data. They can let you know right away if they see a business or tax strategy that would benefit you.
  • Cash Management: Would it help you sleep better at night knowing you had enough cash on hand to cover your expenses at all times? This is just one area of Operational Management Support that can be provided by your accounting team.
  • Analysis of Business Structure: Have you chosen the correct entity for your business? Would it be wiser for you to have employees or independent contractors? These are just a couple of examples of decisions Tax Advisors can help you with to determine the best financial structure for your business.
  • Financing Your Business: How would it feel to be so familiar with your cash flow so that you can be sure you have all of your expenses covered as well as budget for future investments in your business? These services can be part of your Business Plan when you work with the right accounting firm.
  • Tax Planning: Did you know tax planning is not just tax projection? Income Tax Planning Services allow you to find strategies to reduce your tax liability in the future as well as give you a budget for your current tax estimate in order to avoid penalties.

How Are Small Business Accountant Fees Structured?

There are several ways accountant fees are organized. The services your Small Business requires may fall under one or more of these.

  • Hourly Rate: Traditionally, this is how accounting fees have been set up. You are charged for every hour spent on your bookkeeping and taxes which could vary throughout the year.
  • Ongoing Rate: Often accounting firms will package their bookkeeping, tax planning and advisory services so that you can hire them on an ongoing basis. You can add to your budget a monthly or weekly fixed rate.
  • Per Engagement Or Project: Sometimes you need an accountant for a special project, for instance, an audit or solely for business tax preparation. Some firms will charge a one-time rate for these services.

Is It Worth Hiring An Accountant For Your Small Business?

What would happen if instead of hiring a bookkeeper, you hired a whole team of accounting experts to handle the financial side of your business?

  • You’d be shown ways to save money you didn’t know existed. These experts can tell you the best time to make capital purchases, make sure you are taking every deduction you are eligible for and show you how to reduce capital gains taxes.
  • You’d have a team of Small Business Specialists available to answer all your financial questions, for example, questions about financial statements, cash flow, and depreciation.
  • You’d have partners who are proficient in identifying opportunities to grow your business and increase your profit margin using up-to-the-minute KPIs and current Benchmarks for your industry.

What You Should Consider Before Hiring An Accountant

Before you hire an accountant, do your research to find the firm that is the right fit for you. Here are some additional things to consider.

  • Be sure to find out what certifications your accounting team holds. There is a vast difference between the work a bookkeeper is able to do and what an Enrolled Agent (EA) or CPA can do for your business. Some CPAs even receive advanced certifications such as a Certified Tax Coach.
  • Review the firm’s commitment to customer service. Is it easy to get a hold of someone with your questions? Are they responsive to your inquiries? Do they seem eager to serve you and have you as their customer?
  • Gauge their level of proficiency as a Small Business Accounting firm. Dealing with experts who are familiar with the nuances of owning your own business can save you time and money and give you peace of mind.

Let Professional Accountants Handle Your Books For You So You Can Focus on Growth

The accounting team at J.R. Martin & Associates is committed to building better businesses through their accounting services. As the only Certified Tax Coach north of Sacramento, CA, these professionals are ready to address the specialized needs of a small business. They provide sound business and tax advice to enhance the success of local businesses.

Want to know more about how we price our accounting packages? Check this page about our prices for small business accounting services.