Small Business Accounting: A Dilemma When Starting Up Small businesses often want to save on costs by not hiring professional accountants when starting out initially their operations. They purchase the latest accounting software, with small business accounting methodologies, and do the accounting themselves by tracking their sales and expenses. When the going gets tough, when there is a need to pay taxes and prepare financial reports for loan purposes, only then will they realize that they need professional help to meet these requirements . At this point, they start thinking about hiring a professional accountant to give them good advice. But how do you find a good one? If you want someone who can advise you on - tax matters, business organization, preparation of financial reports, and tax returns - you need a certified public accountant (CPA) or 'an enrolled agent (EA), who is a licensed tax professional. Routine accounting work that covers paying invoices, recording daily transactions, issuing billing statements to clients, can be done by an accountant or by yourself, if you have a basic understanding of the terms and accounting terminologies. A good accountant for you is someone who has extensive experience in your industry and the necessary expertise in the accounting profession. This is someone who understands the intricacies of the industry and can help you not only with your books of accounts but also in making strategic business decisions. These would include making and purchasing decisions, investment strategies, product development and computerization among others to keep your business competitive in the market. Start-up operations without professional help may be more co...... middle of document......effect on the Small Business Health Care Tax Credit and reporting requirements required of employers. These reports show the cost of coverage and employer-sponsored health plans. Other changes would include revisions to the net investment income tax, the Medicare tax and insurers' health coverage. The tax implications and changes in current and future regulations would be best understood by practicing accountants who are familiar with this area. Professional accountants would also be best placed to advise you on the right accounting software for your business. You can discuss with him the type of software best suited to the type of operations you perform. Being up to date in his profession, he is the person best placed to advise you on changes in accounting practices that would have a direct impact on your specific sector of activity..