Mar 19 Top 5 Mistakes To Avoid When Choosing Small Business Accounting Services I see it all the time…small business owners making mistakes when choosing small business accounting services. In the life cycle of a business, it makes sense to outsource your accounting and bookkeeping when you reach a certain point. When you start your business, you have some extra time to do the accounting, and this makes sense to do. By doing so, you really learn the ins and outs of your business and how to account for everything. But as you grow, the cost outweighs the benefit. You could be spending your time doing more valuable things, like gaining more sales or starting new lines of business. But, time and again, when business owners get to this point, they make mistakes when they choose small business accounting services. Here are the top 5: 1.They don’t define what they need – the first mistake they make when choosing small business accounting services is that they don’t define what they actually need. By not taking the time to prepare a job description and really defining, in detail, what they need, they end up either hiring or outsourcing to the wrong person or company. This invariably ends up in frustration. 2. They don’t define what they want – needs and wants are different. Yeah, you need your bookkeeping done, but what do you want? Do you want weekly reports, do you want a cash flow projection, do you want someone to pay the bills? Get really clear on not only what you need, but also what you want. 3. They can’t qualify the skills – most business owners are not accountants, so they generally hire an accounting firm based on feel rather than competency. Again, this will end up in frustration, or worse yet, incorrect books, because they had no way to gauge the competency of who they were hiring. Ask for referrals from other business owners, look online for reviews, and ask for references. 4. They hire a full-time employee – what really surprises me when choosing small business accounting services is that a business owner will hire a full-time employee to do the accounting (that is typically not qualified). For a fraction of the cost, a qualified accounting firm can do this work and have a team of people at your beck and call. Outsourcing the work will lead to lower cost, better and more timely information. 5. They hire the wrong fit – Oftentimes, business owners have visions of a bookkeeper coming in and not only keeping the books, but also filling the role of CFO and strategist for the business. This is a disaster waiting to happen. Keep this in mind when looking for small business accounting services: Bookkeeper = data entry looking at the pastController = data entry with accounting knowledge and experience looking at the pastCFO = Strategist looking to the future These skills are entirely different and are often not all in the same person. Don’t hire a bookkeeper because “they are inexpensive” and think you are going to get CFO level results. It just won’t happen. So, whether you are in this boat now, or will be looking for small business accounting services in the near future, sit down and give some thought to these 5 mistakes before you get started. Avoiding them will save you a lot of time, frustration and money.