Business owners rely on their accountants to guide them to financial success. Regular, candid conversations strengthen your relationship and set your company up for success. But a lot of owners don’t know what to say.
- What should you talk about?
- What questions should you ask?
- How can these conversations help you grow?
You’ll have plenty of conversations with your accountant over the years, but these are some of the most important.
1. Goals and Future Plans
Does your accountant know about your goals and future plans? For most business owners, the goal is for their company to fund their life. You may plan to use your earnings to:
- Send your kids to a private school &/or college
- Buy a beach home &/or a place in the mountains
- Do significant travelling & vacationing
- Fund a comfortable retirement
I always ask my clients about their expectations for the business. How long do you want to spend in the business? Then I ask about their goals:
- How far do you want to grow the company?
- Do you want to sell it off?
- Would you sell it to a key employee?
- Or gift it to a kid?
Your business’s goals and future plans need to align. For example, if you want to retire in 10 years, the sale of your company may be the catalyst that helps you reach your goal.
Conversations like this can transition into discussions about succession plans and what changes you need to make to reach your goals as a business owner.
Owners should address their goals and future plans with their accountants so that they can help them take the strategic steps necessary to reach them.
2. Company’s Financial Performance
You’re a business owner. Finances matter. You need to focus heavily on maximizing your profitability and cash flow, but you can’t do this if you don’t have a grasp on your company’s financial performance.
Accountants can help you:
- Develop KPIs (Key Performance Indicators)
- Set benchmarks
- Measure & track key metrics
- Analyze results
- Determine adjustments to make
Your financial performance paints a picture of the company’s overall health. Your cash flow may be low, causing you to borrow on credit and go into debt. Over the long-term, this scenario will lead to failure.
Cash flow is the lifeblood of your business.
Why do 82% of companies fail? Cash flow.
Your accountant should review your financial performance and have tough, honest conversations with you when needed.
Perhaps you need to cut staff, eliminate underperforming products or services, or you might need to change your pricing. Your accountant will look through your financials to help you take steps to increase free cash flow and stay out of debt so that you can succeed in business.
3. Strategic Planning and Budgeting
Spending too much? Moving forward with a failing budget is a recipe for disaster. Instead of defaulting to taking out loans or maxing out credit cards, it’s time to change your focus to strategic planning. Make it a point to:
- Take a step back to look at your business
- Assess your budget and what’s really going on
- Create a plan to reach your goals
Conversations about budgeting are a top priority, and they’re one of the talks that you should have every quarter with your accountant.
You have strategic objectives that your accountant will help you monitor and make adjustments to so that you can accomplish your goals.
I have one question for you: what are you looking to accomplish in your business?
If you don’t know, take the time to figure it out so that you have something to measure against going forward.
Budgeting is part of an overall plan that pushes you towards your goals and sets you up for success.
4. Challenges and Big Changes
Change is the only constant in life and the business world. Your accountant needs to know of the challenges that you face and the big changes that pop up on both a personal and professional level.
For example, you may have challenges with:
- Personnel
- Technology
- Bottlenecks
- Implementation
- Marketing
- Funding
Discuss these challenges with your accountant to see what they recommend to help you change course. Your accountant is more than just someone who helps you with your finances; they are also strategic partners who push your business forward.
Plan on making a big change? Talk to your accountant.
For example, you might plan on retiring in the next three years because of a health issue. Bring this to your accountant’s attention. Want to expand into new markets? Your accountant can review your finances and help you address issues that you might overlook.
Accountants are validators, and yours should have the confidence to tell you that now is not the time to make that big purchase or to execute your expansion plan.
Any time there are big challenges and changes in your business or personal life, schedule a call with your accountant to let them know. You’ll be surprised how these conversations can be helpful and set you up for long-term success.
5. Risk and Accounting Systems
What are your biggest risks and concerns? Are you:
- Dependent on a key employee?
- Relying on a single client too much?
- Dealing with a significant competitor?
Address these issues with your accountant. While you’re discussing risks, also review your accounting systems. I’ve seen vulnerable clients who became victims of embezzlement before they came to me.
Small business owners have risks that they might not even realize.
Why?
It’s not uncommon to put all of your trust in one person who takes on many roles in your company.
I’ll give you an example. I was asked to do forensic work for a dental practice. What we found was a clear breach of trust. The practice’s bookkeeper had a credit card from the same company that the dentist had, so she would pass off her bills as the dental practice’s debts.
Ultimately, the dental practice paid for the bookkeeper’s:
- Vacations
- Personal expenses
- Daughter’s wedding
Accounting systems help you address these risks so that they prevent you from falling victim to fraud. The bookkeeper even gave herself raises while robbing her employer.
Systems stop fraud like this and strengthen your business over the long term.
6. Taxes
Business owners: What do you think of when you hear the word “accountant?” It’s probably taxes. You hand over paperwork, pay your taxes, and keep going. But accountants should offer tax planning that helps you:
- Reduce your tax burden
- Plan for big expenditures
- Take more deductions
- Maximize tax credits
Tax planning helps you reach your financial and growth goals. If you’re worried about your cash flow, planning can help free up some of these funds.
Talk to your accountant throughout the year about tax planning so that you can remain compliant while minimizing your tax liabilities.
Final Thoughts
View your accountant as an ally and a sounding board who helps you manage your personal and business goals and finances. Spark conversations with your financial professional that push the needle closer to your goals, reduce risks, and set you up for success.
Schedule an appointment to learn how we can help you reach your business and personal goals.