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Take your bookkeeping seriously: Hire a financial expert


Always seek
expert advice when starting a business
Starting and successfully running a small business can be daunting. New business owners might have expertise in the core business, but they might need assistance with certain managerial functions, such as bookkeeping.
Early on, many business owners do their own bookkeeping or have a spouse or family member oversee the accounting.
“One of the advantages is keeping your finger on the pulse of the financial side of your business,” says Jeffrey R. Updegraff, a certified public accountant and principal of Updegraff & Ruhl, a CPA firm in Camp Hill. “Someone with basic bookkeeping skills can manage to maintain the financial records of a small business and know what is owed to them, what bills are due and cash-flow needs.
“Even so, this requires ability and time in addition to managerial, marketing and service duties,” Updegraff adds. “If the company can afford a trained internal bookkeeper, even if only part time, the owner will be better served.”
Natalie Harley, owner of Marketing & Communications Solutions in Dillsburg, agrees that finding time to attend to bookkeeping duties can be a challenge. “I handle the day-to-day bookkeeping responsibilities now,” she says. “In the early days of my business, my husband did the bookkeeping. We found it very helpful to meet monthly to ensure we had adequate oversight on the finances.” Harley received her master’s degree in business administration from Penn State Harrisburg in 1992. Among the courses she had to take for her degree that helped her in her business were basic accounting and financial management.
For every business, the time will come when it is critical to seek external accounting advice.
“Anyone starting a new business should seek the advice and expertise of a CPA prior to undertaking the endeavor,” Updegraff advises. “An accountant can assist in selecting the correct business structure for the entity and assist in planning the startup phase of a business. Models, budgets and projections should all be prepared prior to the commencement of operations.”
Harley agrees. “We used our accountant in the beginning to help us get things set up appropriately,” she recalls. “Now, we use him when we have a question beyond our scope and to provide year-end tax assistance.”
Updegraff also suggests that businesses seek accounting assistance if the owner is spending too much time managing the books; if accounting reports are not accurate or timely; or if transactions become too complex for the business owner to summarize and record.
When seeking outside assistance, Updegraff says business owners should look for an accountant’s credentials. For example, check his or her degrees, collect references from successful businesses, find out the firm’s standing in the community, and research the scope of services the firm offers.
“The most important thing is to do your homework,” advises Mary Beth Matteo, director of The Family Business Center at Elizabethtown College. “Firms have different flavors and personalities.”
“Compare the size of your business and the size of the prospective accounting firm,” Matteo says. “Select the firm you can get the highest degree of service from. Ask yourself if you will have access to the accounting professionals you want to be able to access.”
Matteo also suggests that business owners ask prospective firms for their mission statements or business philosophy. “These statements may resonate deeply with you or leave you cold,” she says. “They give you a basis for asking important questions about the company you are evaluating.”
Matteo says that it is a good idea to give a prospective firm a small piece of work to do, in order to evaluate if the relationship will work. Updegraff adds that the business owner should always have an understanding of the engagement, preferably in writing, before hiring any professional.
“The agreement should outline the services that will be rendered by the accountant and the fees associated with those services,” he says. “Quite often the accountant can provide additional services. These services should be discussed before the accountant begins work. Business owners should always ask why an additional service is necessary or how it will benefit the business.”
Careful evaluation and planning are fundamental. Updegraff concludes, “The bottom line is that a good accounting system should not be an afterthought for business success; it should be an integral part of any successful business.”

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