and how can they help you?
Let's start with the definition.
noun a person whose job is to keep or inspect financial accounts.
Accountants have generally had schooling and training to learn how to evaluate financial statements.
While the bookkeeper's job is to record all financial transactions for a business, an accountants job is to inspect and analyze those transactions. Bookkeepers are in charge of the data, accountants use that data to help business owners make decisions. Bookkeeping is black & white. Accounting calls for educated assumptions. Bookkeeping looks back on past data. Accounting focuses on future projections. For now we're going to focus on why accountants are so important.
These two roles share common goals but support businesses differently.
Accountants are the partner in your corner helping you make smarter, proactive decisions in your business. They help you take your current number and figure out how to improve them. They will help you identify your weaknesses and increase your strengths. Accountants also generally have relationships with other professional services to help you when you need them. This includes insurance agents, bankers, attorneys, etc.
So what does an accountant actually do?
· Enter adjusting entries (anything that wasn’t recorded by the bookkeeper)
· Prepare financial statements
· Analyze the data
· Help the business owner understand the information and make proactive decisions
^that last one is really the kicker. An accountant helps business owners understand the numbers in their business and use that information to make better decisions. By analyzing the data, accountants can help point out areas of success and areas that need improvement.
Accountants help you step away from your receipts and bank statements to see the bigger picture and the path towards success. Think strategic planning, financial forecasting, etc.
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