With the increased globalization we’re experiencing in the modern period, we find that more countries are coming into economic prominence than ever before and that more markets are opening up for American businesses to break into. For those business who seek international expansion or who are already in the process of selling their goods and services worldwide, an international accounting firm is what is needed to ensure that taxes are paid and that financial records are well-kept.
As the world comes into its’ own within the next few decades and multiple superpowers rise to create complete globalization, an international accounting firm will one day be a must-have for every business. Though that point is decades away, what an international accounting firm offers is simplification.
What happens if you make a purchase that requires payment in a foreign currency or that you sold a product for which you receive a foreign currency? This presents a multitude of different challenges that normally one would not experience working domestically. Worse yet, what is the exchange rate changes between the date you record an accounts payable and the date you actually make payment in foreign currency? It’s issues like these that an international accounting firm that resolve quite easily and keep your head out of this mess.
If you aim to open subsidiaries in foreign countries, an international accounting firm can assist with the likelihood of having to prepare your financial statements using the rules and currency of that foreign country.
There’s no need to go through these headaches. Leave it to the experts. The rules certainly change as borders are crossed and as you continue to expand internationally, an international accounting firm can complete foreign financial analysis, foreign audits, and can provide you with a consultant on the differences between preparing tax returns for a domestic parent company and preparing taxes for foreign subsidiaries. This is what worries many owners when they expand internationally because tax rates are different in different countries, tax rules are always changing, and tax planning can be extremely difficult in a landscape where you’re just beginning to learn what way’s up.
Small businesses may require an international accounting firm should they choose to outsource their manufacturing processes to a foreign country or to several foreign nations. They will no doubt be complications that arise from differentials in wage rates, the availability of resources, tax laws, and other factors. It’s the aforementioned simplification that an international accounting firm brings to the table.
Every internationally successful entrepreneur can tell you that it’s more who you surround yourself with than anything and the international allies you choose when undergoing expansion. When it comes to the financial department, leave it to the experts. Leave it to your experts. Through the efforts of an international accounting firm, you can delegate administrative conundrums like those mentioned above. Management of an international business is quite a bit different than a domestic one and it can become quite complex. This allows you to oversee the major business decisions that guide brand development, marketing, project management, and other aspects of your business that are integral to a permanent expansion out of the United States and to achieve prominence abroad.
Looking for an Accountant for your Business
No what matter what size of business you own, good accounting practices are crucial. A good accountant or accounting firm will not only make sure that your finances are in order, but will also make sure that your tax filings are accurate, complete, and fit into regulatory standards. A good accountant will also advise you on ways you can minimize the tax burden on your business, including items you can claim and the structure of your business. Whether you’re seeking accounting for small business or large, it’s important that you find a firm that works well with your specific business.
A good accounting firm needs to have a proven track record with businesses the same size as yours, and they should have an understanding of your industry, your business type, and your management structure. A good accountant knows your business inside out, and is able to leverage that knowledge to achieve significant tax savings to help you achieve financial growth. Not all accounting firms are created equal. Accounting is not a one size fits all industry, so it’s important that your accountant work well with your business.
Choosing an Accountant for your Business Size
One of the biggest considerations when choosing an accounting firm is the size of your business. Accounting small business services vary greatly from services for large business. There are a few reasons for this. Of course there is the matter of how much money your business brings in. A higher cash flow will result in a higher amount of taxes paid, and therefore extra caution is required. Business structure will also affect accounting procedures. Accounting for small business often means working with owner-managers, and that is a much different practice from accounting for a major corporation. Owner-managers often see a lot of overlap between their personal and business finances, so a small business accountant must be prepared for that.
Large businesses often tend to have more complex business structures as well, in order to protect assets and maximize cash flow, so a large business accountant must have a strong understanding of business structure options. Finally, a large business usually requires a large accounting firm to ensure they have the manpower to manage a larger account. Firms that specialize in accounting for small business might have the knowledge to work with a large firm, but they might not have the time required.
Is your Business Large, Medium, or Small?
Once you’ve decided to find an accountant for your business, it’s time to determine what size your business is. This might sound easy, but everyone has different ways of classifying small, medium, and large businesses. If you’re a little unsure of what size your business is, talk to prospective accounting firms. They’ll let you know how they classify business size you can choose the right firm. No matter what type of business you run, it’s important to find an accounting firm that works well with your business. Understanding the difference between accounting for small business and accounting for large business is the first step in finding the best accountant for your company.
A lot of work goes into running a small business – or any business – but the difference with a small business is the man power. In most cases, small businesses can’t afford the luxury of hiring a large staff to handle all the work which means that the majority of the work and responsibility falls to one or two people. Depending on the type of business you run, this may be just fine but the chances are you probably have a little more on your plate than you can handle. Whether the accounting for small business duties are piling up or you’ve fallen behind on supply orders, you have to do something to fix it.
Being a small business owner is a point of pride for most. It says you made it, and you made it there on your own steam and ambition. Sometimes this pride translates to inability to ask for help when it is really needed. This doesn’t mean applying for a loan, no. This means the most basic help, from getting your filing done to answering the phones, sometimes you just need help. Most of the time, however, hiring someone to help isn’t in the budget. Luckily, you don’t have to hire someone on full-time, in fact they don’t even need to be at work in some cases. This is that beautiful thing called outsourcing. You need some accounting for small business assistance? Great! Outsource it. You need a part time clerk or secretary? Perfect. Get an intern.
There are many ways to handle the challenges that come with owning a small business and the best part is, you don’t have to do it alone. While you tackle finding new sales paths, locking down clients and promoting your brand, the rest of the business is in good hands. Outsourcing accounting for small business tasks like payroll, taxes, bookkeeping and year end reporting, means you have more time to focus on building your business. If you can let go of the reigns in all the smaller areas, like administration, then you have more time and focus to put toward your success. The more successful you are, the more you can afford. One day you may be able to employ a full staff and take a holiday – who knows!
What’s important is that you choose an accounting firm you can trust to handle your business’s financial affairs correctly. Just because you are outsourcing doesn’t mean you don’t deserve excellent customer service and quick turnaround times. Accounting for small businesses can involve a lot of important documentation and you want it done right so that you don’t have to worry about it. Outsourcing your accounting will give you access to professional services and advice without paying someone a full-time salary.
If you have finally decided that you need to delegate some work to a third party so that you can focus on your business, consider outsourcing your accounting for small business tasks. It’s an important part of your business that undoubtedly eats up a great deal of your time. Why not leave it to a professional?
We only die once, which usually means that we only need to establish our estate once as well. However, when we only do something one time, we do not always get it right, and, in fact, we usually miss more than one thing. This is why we want to show you how to avoid the top 10 estate planning mistakes.
1. Procrastinating – Thinking you Have all the Time in the World
We don’t like to think that we are ever going to die, but the time eventually comes for everyone. This is why you should never procrastinate your estate planning. Even if you don’t think you have any finances to plan for, chances are you high that you have something you want to leave to a loved one.
2. Don’t Think of the Long-Term Wellbeing of loved ones
On that note, we would love to be able to leave our loved ones a lot of money so we know they are safe. However, this is not always the right thing to do. Sometimes a trust fund is the answer rather than a lump sum. It depends on the person and situation.
3. Don’t Take Everything Into Consideration
Sometimes we invest ourselves in one set estate planning approach, and do not think of the big picture. You need to consider all the what-ifs. There are three components to looking at the big picture and these are:
• People: This includes you, your spouse, children, grandchildren and other relatives.
• Property: This includes all your assets and wealth – personal property, real property, investments, money, potential inheritances, and retirement funds, as well as what you own now, and might own in the future.
• Process: This means how to develop your estate plan to ensure you optimize management initiatives, techniques and legal entities to achieve your long-term goals.
4. Not Planning for Divorce
With estate planning, we often don’t think that we might divorce our spouse, but sometimes it happens. This is where a contingency that places restrictions on money distribution outside the family is required; as well as other considerations.
5. Not Planning for Disability
An unexpected disability has a great impact on our personal and financial affairs. Therefore, deciding who will handle finances, childcare and healthcare decisions is important. It is never too early to plan for a potential long-term disability because it only takes a second for an accident to happen.
6. Don’t Keep Documents up to Date
Often the importance of updating documents is overlooked, but it is imperative to estate planning in Los Angeles or anywhere in the United States. This includes your will, title documents, and numerous other assets. Always make sure you have everything up to date.
7. Underestimating Trusts
Trusts are not only for minor children; they are a way to protect assets that involve the whole family—and these assets need protection from creditors.
8. Not Including Digital Assets
We live in a digital world where we make money online, and if you don’t have the password, you cannot get into digital accounts. This is why someone needs to have a list of all your online usernames and passwords; in particular, your PayPal account.
9. Not Thinking of tax Consequences
It is sometimes easy to forget about the big bite taxes takes out of estates. This also applies to life insurance policies. You should transfer life insurance policies to a life insurance trust.
10. Doing it Yourself (DIY) to Save Money
Although the DIY mentality is excellent for some things, it is not ideal when it comes to estate planning (https://en.wikipedia.org/wiki/Estate_planning). It may seem like perhaps you are saving money, but in actuality it is probably costing you money. Estate planning is one instance where you need an expert on your side.
Professional estate planners are experienced in not only managing estates, but dealing with estate planning issues as well. They know how to avoid the top 10 estate planning mistakes because they are involved with estate planning every day.
If you choose to do your own estate planning rather than hire top accounting firms, make sure that you avoid the mistakes discussed here. The last thing you want to do is miss something, or not complete the right paper work. The whole purpose of estate planning is to make sure your loved ones are cared for exactly how you want them to be.
Throwing a rock in the right direction in any city might see that rock bouncing off five certified public accountants before hitting the ground. The market for accountants is pretty heavily saturated in the larger cities of the United States. Most accountants work for accounting firms but, of course, there are freelance accountants. The pros and cons of freelance accountants versus accounting firms are detailed here.
Unless one is the next Simon Dolan, it might not be wise to invest in a freelance accountant because they might not have the backing, resources and experience one would find in larger accounting firms. This begs the question of “How do I know if he is as skilled as Dolan?” You might never know; this is a risk you would have to take. Large accounting firms, like the Big Four, are known for their wide range experience. Freelance accountants may not have that kind of knowledge.
However, what one might potentially lose from hiring a freelance accountant over any one of the many accounting firms is balanced by what one might gain. That is, a personal relationship with your accountant. Not like the Enron scandal where the accountant allegedly helped obstruct justice (and this belies a very personal relationship with Enron), but an accountant where you do not mind grabbing a beer and maybe some grub with.
Another positive to hiring a freelance accountant is that they might have a smaller client base, therefore giving you a lot more attention and time for your needs. Accounting firms might not be able to provide this, though this is a fine line to tread: some firms are too big to let every client know they are special, but some firms are just big enough to give the client comfort and get an excellent job done every time.
Where is your business going? Hong Kong? Australia? Maldives? This is another negative point for freelance accountants that accounting firms do not suffer from: a wider range of employees fluent in more languages. Of course, if you just want your business to stay in Las Angeles for the time being, it might be wiser to hire one of the bigger local accounting firms than a freelancer or one of the Big Four.
The main difference between a freelance accountant and accounting firms is that the firms are always going to be bigger, more resourceful and more experienced. Freelance accountants may be able to spend more time with one client and thusly be more attentive, but the lack of experience may not make up for that. For a starting business, it is possible that a freelance accountant would work better than a firm, but this is no sure thing. Also, and this you have already done, but different accountants are better at different areas of accounting (non profits, entertainment industry, family wealth) and while one freelance accountant may have experience in all of them, the best accounting firms have employees devoted to just one area. Specialized knowledge in many employees versus a wide range of knowledge, none of it specialized, in one person. The choice is yours.
If you talk to a few people ‘in the know’, most will tell you something to the effect of ‘small business and self-employment is where it’s at’. It is true that these options are becoming more popular throughout the developed world, as regulations around starting up a new business are eased or streamlined, entire new industries spring up that require a smaller overhead threshold, and modern technology allows more people to work from home (or from any location, for that matter). Small and medium-sized business grows in popularity and in numbers, and so do the financial transactions between such enterprises. As the taxation systems and other government rules and regulations still struggle to catch up with this new reality, many entrepreneurs may find themselves spending more time than necessary or advisable on the accounting their small business requires instead of actually running the operations and meeting new potential clients. This is where the question of hiring professional accountants comes to the fore.
Two basic approaches available
When it comes to hiring accounting for small business, there are two basic ways to go about it – having an accountant or accountants internally or contracting this work out. In the past, as outsourcing and contracting out were frowned upon or ignored as options, most small businesses appeared to have no choice but to follow the larger corporations and setting up their own internal finances and accounting departments, which would often become significant expense lines in the budgets without truly being necessary on a permanent basis. While it is advisable that an internal resource be available to handle some of the day to day accounting of the small business, many experts will agree today that outsourcing accounting is no longer a regrettable or unwise decision to make. In fact, more and more small businesses are doing just that: putting their trust in small business accounting professionals, so that they can focus back on doing the things that they enjoy. Some of the areas that have the greatest growth in such services are service-based companies, non-profits, franchises, and real estate companies.
What to look for in a contracted accountant
If you decide to follow this newly emerged best practice, you would need to do ample research to ensure that the company you deal with is, in fact, proficient in accounting for small business. They should have a significant number of years and clients in their portfolio that would demonstrate their knowledge, skill set and dedication to helping small businesses streamline their accounting practices in the best way possible. Your external accounting services provider should be able to advise on industry standards in documentation, innovative approaches to cash collection management, the use of technology such as cloud computing for handling confidential and sensitive information. Researching the service provider would certainly be in the best interests of your company, as key parameters to a successful business, such as financial integrity and operational efficiency, are at stake. Once you have found an external accounting for small business service that meets these criteria, you should be on the right path for your business future.
Maybe you have always dreamt about becoming your own boss. That dream might involve starting your own home-based business or maybe it involves hanging out your shingle and opening your own small business. Whatever your dream, make sure that you have a solid business plan in place. And just to make sure you avoid having your dream turn into a nightmare, establish a relationship with a dependable small business accounting firm.
While it probably true that you graduated from high school with some good grades in Mathematics, and you may even have taken a few extra math courses in college, this in no way gives you the ability to do your own small business accounting. Your education, if it wasn’t specifically in accounting, may be fine for maintaining the books for your day to operations, and it might even help you keep up with your monthly expenditures, payroll, and receivables. But it is of the utmost importance you regularly seek some professional accounting help and advice. After all, you don’t want your lifelong dream turning into a nightmare. Here are a few good tips to help keep your small business accounting in order.
Buy an accounting ledger and keep it up to date. This will become a good physical record that you can fall back on in case of a computer tragedy. It would be a shame to lose all of your accounting records because of a computer glitch. But by using a hands- on approach and physically recording important financial transactions, you will always have a paper trail to fall back on. Your small business accounting partners will appreciate that you did.
Invest in some good, user-friendly accounting software. There are several different accounting programs to choose from, so ask your small business accounting firm for some advice. There is no use in out-smarting yourself here. If the program is too complicated, then you will be far less likely to use it. A good accounting software program will allow you to enter information quickly, but should still be able to provide your with an overview of your business.
Take a small business accounting course. It may be a pain for you, but it will not hurt your business. Taking the time to understand the basic ins and outs of your small business finances could be the second best thing you ever do – next to hiring an accounting firm. A small business accounting course offered through online study at a local college is a good choice because it can be flexible to your work hours. Plus, by taking an accounting course, you will learn some of the accounting lingo.
Set up a regular meeting time with your small business accounting firm. Just meeting at year-end to have your accountant tidy up your finances works, but it is not the most effective way to run your business. Quarterly meetings with your accountant will help things run smoothly all year long. Besides the more often you meet with your accountant, the less big mistakes there will be to fix. At the end of the day this will mean less stress and more business success.