We’re continuing our series with guest writer, Paul Downs, author of the forthcoming book Boss Life: Surviving My Own Small Business.
I managed to stay in business for 17 years before I hired an accountant. I did my own taxes, almost certainly incorrectly, but never got in trouble for it. (Hmmm. Probably overpaid every year.) My bookkeeping was a disaster: the classic receipts-in-the-shoebox approach. In my defense, I started my business in 1986, before Quickbooks existed, and didn’t get a computer until 1997.
When I finally retained an accountant, in 2003, it wasn’t for day-to-day help. I used her only for taxes at the end of the year. I would send her a Quickbooks file in January, and get back a pile of tax forms a month or so later. It was all neatly arranged, with clear directions where to sign and what checks to write. I appreciated that. During the rest of the year, I relied on a bookkeeper to enter the bills and income into Quickbooks, and managed cash flow myself. This led to lots of trouble, because I didn’t really know how to manage the cash. But I was too busy with my day-to-day struggles to fix this.
In 2010 I took advantage of my blog in the Times to ask for help. It’s a short post, and the good stuff is in the comments. Summary: there are different kinds of accountants. Some are hands-off, but you can hire others who will be as involved in your business as you want them to be.
If you are wondering about your relationship with your accountant, take a look:
Paul Downs is the author of Boss Life: Surviving My Own Small Business.