Most pest control businesses start small. And like most small businesses, they don’t have a large budget, so they spend money only what they feel is necessary. Otherwise they run the risk of going out of business before they have a good chance to become profitable. There are a lot of necessary expenses when just starting out, even if it will only be a one-man operation at the beginning. The main reason small businesses go out of business early is because they get caught up in buying unnecessary items and then run out of money before they start to make a profit.
Hence the question of whether hiring a CPA is a necessary expense. After all, they could just do the books, file tax returns, and pay sales tax all themselves. But that eats up into the time needed to run the business. Also, most people have no experience reading a profit and loss statement, and they’re not strong financial managers. So at some point they will begin to explore the possibility of hiring a professional to take over that aspect of their business.
Which is Best – CPA or Accountant?
A CPA is an accountant who has passed their state licensing exam, whereas an accountant has not. As might be expected, a CPA has a higher level of expertise. After passing the CPA Exam, they have to stay current with continuing education on the tax code and tax laws. For most small businesses, an accountant will be sufficient to serve their accounting needs. Many CPA offices have an accountant on staff, which is the ideal scenario, because the CPA is there when their services may be needed.
In this day of everything being digital and online, it is no longer necessary for a CPA to be local to the business they serve. Many CPA offices have clients across the country, as well as in their area. Jeffrey D. Ressler’s office, at jrcpa.net, is a good example of a CPA who services clients across the United States. He has never met most of them, and yet they are very happy with the service. With Skype and the telephone, he and his staff are always available when a client needs them.
A CPA has more training
CPA’s are generally much more knowledgeable about the tax laws because they’ve been tested on them extensively during the licensing exam, and most of them stay up to date because of the courses they take every year. If the business is ever audited, an accountant cannot represent them before the IRS, only a CPA is entitled to do that. This is probably the biggest reason why every business, no matter the size, including a pest control business, needs to have a CPA they can use when needed.
An accountant can do much of the routine work, including tax return preparation, but for advice on higher-level business financial and tax issues, a CPA is by far the best choice. Even though they typically charge more, for financial and tax decisions, a business needs to have accurate information.
So does a pest control business need someone for their accounting? They could use a bookkeeper to do the daily books, but they will need an accountant and/or a CPA at some point. It’s best to choose the best one for their business before the need arises.