Some myths are harder to dispel than others. Dropping a penny off the Empire State Building cannot kill someone. Yodeling won’t cause an avalanche. Plugging a shotgun with your finger isn’t going to make it backfire. When it comes to the accounting industry, there are also a number of preconceived notions that need a reality check. Here are five myths about accountants that you can consider BUSTED.
Myth #1: Accountants are expensive.
How much is your time worth? If you’re bogged down with accounting and bill paying are you losing money by not being able to do your job effectively? Like almost everything, accounting services range in cost depending on your needs. You can start with introductory services at a low cost and add additional services as your business grows. If you can’t justify employing someone full-time in house, outsourcing to a mobile accounting firm is an affordable option. Additionally, your accountant’s fees are tax deductible so you will get a portion of what you pay them back on your tax return. When it comes down to it, an accountant’s fees are not only affordable, but they’re also really worth paying for.
Myth #2: You can do your own books. All you need is QuickBooks.
While QuickBooks is a user-friendly program, it is only as good as the information supplied to it. Are you equipped to learn the ins and outs of a comprehensive program in order to take advantage of everything QuickBooks has to offer? You can glean a wealth of information from QuickBooks reports. You can enlist an experienced accounting firm to train you to use the software. During your training you may decide that you want to use the firm to perform some of your bookkeeping services to take some of the burden away. Think about it this way: if you were to hire an accountant, would you want someone who only had a passing knowledge of accounting or would you want an expert? Bottom line: don’t risk the financial health of your business on less than expert level accounting.
Myth #3: Accountants only do taxes.
Preparing for tax filing is a small portion of what accountants do – and some (like JADDE Financial Solutions) don’t do tax prep work at all! Accounts DO: examine financial statements for accuracy and ensure compliance with laws and regulations. They organize and evaluate financial records. This allows them to make recommendations that will improve efficiencies and cut unnecessary costs. They can also perform regular audits to ensure inventory management is optimal. An excellent accountant helps business managers make informed decisions based on the most accurate information. High quality accounting services are important year-round, not just around tax season.
Myth #4: You don’t need to keep receipts.
You should keep a minimum of seven years of records in the event of an audit. That doesn’t mean you’ll have filing cabinets full of paper. Digital scans of receipts are just as effective as the original. Also, don’t rely on your bank or credit card company to keep your old statements for you. They often only have access to 18 months to three years of statements. Download and save the pdfs so you have a digital copy of them.
Myth #5: Storing your financials online leaves you vulnerable to hacking and identity theft.
The reality is that any Internet connection leaves you vulnerable to hacking and identity theft. The firewalls and encryptions used by your cloud accountants are likely to be far safer than what you use in your office. Cloud servers are backed up in real time so if a server goes down, your information will remain safe. If you use localized hard drives to store your information, you can be subject to data loss from theft, power surges, or disk failure. Accounting via the cloud will leave your company financials much less vulnerable to loss all around.