Posted on: 10 September 2020Share
Accounting services cover a lot of domains, and it can leave the clients of accountants wondering what they need to talk about. If you're worried that you're not making the most of working with a professional, here are four accounting conversations you should have.
The Art of Documentation
If there's one thing you can do to become your accountant's favorite client, it would be to get your documentation in order. This goes beyond simply keeping the books straight. You should also make copies of everything and impose an organizational system. Store originals with a date-based system, and put them in a safe and secure location for easy retrieval and copying.
Beyond the numbers, you should also maintain key documents that influence your accounting work. At a business, this includes things like incorporation documents, agreements, and other supporting paperwork that fills in key details. On the personal side of accounting, you should keep tabs on mortgage papers, anything empowering a trust, and your basic info for each account.
Although folks often think of this as a primarily business-oriented concept, it matters in individual finances, too. At the end of the equation, most accounting success boils down to bringing in more money than you send out. A cash-flow mentality requires you to classify accounting issues properly to ensure that inflows and outflows are accurate.
Even if you're highly confident of the state of your accounts, there's a lot to be said for conducting an occasional audit. High-risk areas of a business may need to be audited on a quarterly or even monthly basis. Low-risk stuff might be audited less frequently, such as once every two years. An annual audit should also be conducted across a business once a year to reconcile basic accounting figures. Individuals of high net worth should take a similar approach to their personal finances.
There's more to taxes than just preparing returns every year. It's wise to think about how certain decisions will affect your tax bill months or even years ahead of time. An accountant can serve as a tax consultant to help you decide, for example, how to incorporate your business to reduce your tax bill. An individual might look at how to minimize tax bills down the road for their estate by choosing between two different types of trusts. It's your right to pay the lowest legally allowed tax bill, but you have to plan ahead to avoid overpaying.
To learn more, contact an accounting company.