How do you hire financial professionals to support your small business? 

What should you look for in a financial pro? 

What tasks should they perform?

What deliverables should they provide? 

Whether these professionals are outsourced or hired into a full-time position, they play a crucial role in the success of a business.  

This article is written to help business owners answer specific questions about hiring financial professionals to support their businesses.  This decision can be confusing for those not familiar with the financial industry.  Financial professionals come with many different titles and services.  Furthermore, there can be overlap in terms of which services professionals provide. 

A good small business financial advisory team should be made up of two main areas:

1. Tax – Sam wants his money on time, and penalties apply if this is not done correctly
2. The day-to-day – This refers to daily operations and the day-to-day flow of cash into and out of the business. Getting this wrong can negatively affect item #1 above.

Tax Professionals – Let’s Discuss

This topic is hardly sexy.  However, taxes are an integral part of running a profitable and healthy business; especially due to the future consequences of not complying.  A tax professional is knowledgeable about tax laws, especially changing tax laws (there can be SIGNIFICANT changes year-to-year).  A good tax professional can also help you put together an effective strategy, so you significantly reduce your tax liability. 

Hiring a tax professional will cost you money, but it will likely save you more money in the end.   

There are several qualified types of tax professionals.  Businesses should look for a Certified Public Accountant (CPA) or an Enrolled Agent (EA).  As with anyone you consider for your team, you should interview them as if you were hiring an employee or considering a partner.  And, as with any profession, all tax preparers are not created equal.  Some preparers even have different specialties.  My best tip here is to find someone who takes the time to explain things and answers your questions.  It’s your business and also your responsibility as the owner.  For a more detailed explanation on tax preparer credentials, go here https://www.irs.gov/tax-professionals/understanding-tax-return-preparer-credentials-and-qualifications. 

Bean Counters and The “Day-to-Day” 

The day-to-day is where most of the activity happens in the business; purchasing equipment or software, hiring new employees, launching a new product or service, or getting paid for products and services.

Historically, this work was handled by someone called a Bookkeeper, or maybe an Accountant.  Fifty years ago, this person recorded a business’s financial transactions in books, literally on paper!  They spent most of their time putting transactions into categories and making sure they aligned with the bank statements.  They also made sure everything was done accurately and according to the professional standards of the trade.  I won’t go into details as you would surely fall asleep.   

As far as training goes, Bookkeepers do not have a certifying body within the United States.  These professionals complete certificate programs, and diploma programs, while others may apprentice under CPAs or accountants.  Professionals who provide these services go by several names which may include Bookkeeper, CPA, Accountant, Outsourced CFO, or Profitability Strategist (and the list goes on).  

To make it even more confusing, many CPAs hire or outsource bookkeeping and accounting tasks because they would rather be doing taxes. 

So, who should you look for to help with the day-to-day financial activities of your business?  

While this may be confusing or even counterintuitive, small business owners should NOT focus on titles, but rather on the services their business needs and the level of service. 

When it’s time to find financial professionals for your business, there are 5 critical areas that you need to ensure are covered.  These are the services I recommend business owners request/ inquire about during the selection process.  These key areas are; 

• Tax – Strategy and proper (legal) execution to minimize how much you owe
• Accounting/bookkeeping – For keeping count of incoming and outgoing cash flows
• Reporting – Financial statements to track business health and profitability
• Analysis/Interpretation – To understand the stories the numbers are telling about the business and provide data to help create a profitable strategy
• Planning/Forecasting/Budgeting – To set and create a road map to success and an accountability plan for reaching goals 

Now, that wasn’t so painful was it?  You are now equipped to hire your financial advisory team, and you know what services they should provide for your business!  With the right set of financial professionals on your team, your business will be set up for financial success.

We Can Help 

At LTA, we don’t do taxes.  We do EVERYTHING else!!!  We provide concierge bookkeeping, financial accounting, and CFO services to help you move your business forward so you can realize your dreams.  Schedule a Discovery Session to learn more.