Accountancy in its various forms has been around for thousands of years with the earliest examples of its practice originating from Sumeria, Assyria and Babylon. Still, many myths abound about any Rochester CPA and his profession despite the passage of time and the progress in education relating to the industry.
Let’s take a closer look at the facts behind these myths. Doing so will make you, a businessman-cum-client of the best Rochester accounting firm, better able to understand the nature of the work and, thus, better able to forge a strong relationship with the accountant.
Myth: Accounting is purely mathematics so anybody who knows how to use a calculator or a computing application will be able to practice the profession.
Fact: Yes, accountants use mathematics to find ratios and percentages (i.e., ROA, ROE and profit margin), state the figures on the financial statements (i.e., total sales on the income statement and owners’ equity in the balance sheet), and compute for tax liabilities, among other purposes. But accountants like the best Rochester CPA consider mathematics as just one part of their profession.
Accountants use analysis of the facts and figures on the financial statements to provide expert opinion to the managers, owners and stockholders of the company. Such analysis involves telling what the numbers mean, what the managers can do with these figures, and what the implications are for the company. Yes, indeed, accounting is considered the language of business for good reasons.
Many non-accountants can be trained to perform basic bookkeeping tasks but said training will not make them accountants. The right education and training are essential for an aspiring accountant to go beyond the mathematics parts of the profession.
Myth: An accountant is the equivalent of an IRS agent, an external auditor and a tax preparer rolled into one.
Fact: Even the best Rochester CPA cannot assume the last two roles in a single company before conflicts of interest come in. For example, when the accountant provides assistance in the preparation of tax returns, he cannot assume the role of an external auditor of the same company; the ethics of the profession rightly forbids such duality of roles. The external auditor must maintain objectivity, both in fact and in appearance.
As to being an IRS agent, an accountant in a Rochester accounting firm – or any private accounting and auditing firm, for that matter – cannot take on the roles attached to the government position. But a Rochester CPA can certainly help your business deal with the legal requirements of the IRS.
Myth: An accountant is unnecessary in small businesses. Bookkeepers and accounting software are all that’s necessary to fulfill the business’ accounting needs.
Fact: Every business large and small must have an accountant on board. It may be on a retainer basis, on a per-project basis, or on an employee basis but the fact still remains – even small businesses require the services of a competent accountant.
Several services can be enjoyed from such an arrangement – setting up the bookkeeping and accounting system, planning for taxes, formulating the business strategies, and identifying capital sources, to name a few. Get the best Rochester CPA on board now and reap the rich harvest for your business sooner than later.
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