Should I choose a CPA or an Accountant?

Should I choose a CPA or an Accounatnt for my small business?  There are multiple types of accounting and tax professionals including bookkeepers, accountants, CPAs, and enrolled agents. Let’s start by explaining what each professional is and what they can do for your business.

What Is A Bookkeeper?

A bookkeeper is an individual who is in charge of maintaining a business’s books. A bookkeeper handles the day-to-day finances of a business.

A bookkeeper’s role can include:

  • Entering data
  • Sending invoices and recording payments
  • Reconciling accounts
  • Managing accounts payable
  • Managing accounts receivable
  • Making payments on the business’s behalf
  • Creating reports
  • Running payroll
  • Managing payroll and state taxes

While small businesses can hire a professional bookkeeper, this role often falls on the business owner or another staff member for small businesses just starting out. However, outsourcing daily bookkeeping tasks can give you peace of mind and more time to run other aspects of your business.

What Is An Accountant?

An accountant is a professional who offers financial advice to businesses. A bookkeeper enters data and creates reports, but an accountant analyzes those reports and turns the data into an actionable, long-term business plan to help you succeed. Accountants generally have a bachelor’s degree.

The role of an accountant can include:

  • Basic bookkeeping tasks
  • Verifying the work of your bookkeeper
  • Initial creation of your business
  • Incorporating your business
  • Creating reports and analyzing business financials
  • Cash flow management and projections
  • Business planning advice
  • Tax planning advice
  • Filing tax returns

While accountants can perform basic bookkeeping tasks, this is not always the best use of your company’s funds as accountants charge more than bookkeepers. Instead, accountants are ideal for when you need business or tax advice.

What Is A Certified Public Accountant?

CPA stands for certified public accountant. A certified public accountant (CPA) is a professional accountant who has more credibility and expertise than a regular accountant.

While the CPA qualifications vary slightly by state, all CPAs must have a bachelor’s degree and have passed the CPA certification exam. After passing the exam, CPAs must meet yearly education requirements to maintain their licenses, meaning they are often more informed on the latest tax laws and practices.

Like general accountants, CPAs are in the business of offering financial advice. CPAs are often viewed as more trustworthy since they have to undergo stringent requirements to obtain and maintain their license.

In addition to the roles of a regular accountant, a CPA:

Can legally represent you and your business before the IRS
Creates audit reports
Creates review reports
Has advanced tax knowledge and support
Adheres to a strict code of ethics
Because CPAs have to go through a strict licensing process and follow a code of ethics, many businesses prefer working with a CPA. The title of CPA was created by the American Institute of Certified Public Accountants (AICPA) to create a standard for accountants to help business owners (and the IRS) feel more confident about an accountant’s work and ethics.

https://www.mrinkcpa.com/our-company/about/

What ever your needs may be ~ we have Bookkeepers, Accountants and CPA’s.  We provide services to Hickory, Statesville, Lenoir, Morganton, Denver, Boone, Lincolton and surrounding areas in western North Carolina.