My first mistake was made, when I was hiring my accountant. I was trying to save money where you never should. Getting the best accountant you can afford my save you loads of money later. You always need to do research on people that you hire especially if it’s an accountant. First thing you need to find out is:
- Is he up to date with all the tax laws and regulations.
- Does he have good references
- Contact he’s previous employer and ask him about his references
- If he was fired, you NEED to know why
After you’ve hired your accountant, don’t assume your job is done. This is your money that we are talking about and he is handling. It doesn’t matter if he is your brother, best friend or a guy/women you’ve never met before, you need to have constant control on what he is doing. You do that by:
- Having monthly meetings with him
- Checking the books monthly
- Run a separate pair of books just for your incomes and outcomes so you always know where you stand and also can compare them with the originals
- Make the accountant always prepare end year report two months before the end of the year, this way you can avoid any unwanted surprises
This is just a short list of what you can do and need to do when starting and running a small business. Some of you will think I’m a bit paranoid, and that’s your right, but then again… wouldn’t you be if it were your money? Does who are a bit paranoid and prepare themselves get richer does who don’t lose money, that is the reality of today’s business.
Now to put these tips in perspective, when I started my business no one told me what to look out for, so I wound up paying a lot of money to the tax office because my accountant didn’t know what he is doing and I didn’t keep an eye on the books. So in the end, despite the fact that I finished the business year with a profit, I wound up paying taxes for past months. By the time I paid everything I was in debt and almost out of business.