Accountants

[dk]

For those of you who own a business and have your own accountant as part of your staff, who truly calls the shots in your business? You? Or your accountant?

How many of you actually know enough about basic accounting to take the information your accountant gives you and make your own decisions rather than having to ask, "Do we have enough money to <business decision>?"

Have you set up your own information systems for analyzing accounting data, or do you basically just go by what the accountant says is best for the business?

I can see this being one aspect of business where the accountant may actually call the shots.

For those of you who do your own accounting, good for you! :D

Sorry, this is just a random thought I've been thinking about for the past day or two.

[socalheart]

I don't have my own business, but my mom does, so will use her for this. heh. Mom has an accountant/girl-Friday. She use to have three accountants, but two kept telling her there wasn't enough money for what she wanted to do. So, she let them go and found enough money to do what she wanted do. ;)

This is sorta how it works now. She asks the accountant how much money there is available. The accountant tells her. She tells the accountant what she wants to buy. The accountant finds a way to get it paid. Sounds simple doesn't it? heh. The accountant also gets free mental health and stress reduction treatment in the form of cheesecake. :D

[dk]

I don't have my own business, but my mom does, so will use her for this. heh. Mom has an accountant/girl-Friday. She use to have three accountants, but two kept telling her there wasn't enough money for what she wanted to do. So, she let them go and found enough money to do what she wanted do. ;)
This is what I was wondering, really. In business, you have to be willing to take risks, and if you rely on a timid accountant to make your business decisions for you, you'll never make it in my opinion. I think the task of an accountant should be more to tell the management what funds are available and after that all decision making should be in the hands of those who supposedly call the shots (the boss, management, etc).

This is sorta how it works now. She asks the accountant how much money there is available. The accountant tells her. She tells the accountant what she wants to buy. The accountant finds a way to get it paid.
Good accountant. :D

I wonder how many businesses play it too safe. I personally would want to have a perfectionist accountant to make sure all my numbers add up, but I wouldn't want to have to rely on an accountant to make the decisions. I think a general knowledge of accounting is advisable for everyone involved in decision making.

Thanks for replying. :)

[socalheart]

It seems that many accountants are timid when it comes to money. They spend so many hours with their noses in the number books, they have a difficult time seeing the whole picture. It took mom's accountant many years to adapt to her whims. heh.

Mom has a small business and some accounting experience, as she used to do the books by hand in the beginning. Her business has been around thirty years, so she must be doing something right. In all practical honesty, if there isn't enough money to do exactly what she needs to buy, she cuts back on how much is bought. It's simple math. If you don't have enough money, don't buy a lot of stuff. She takes risks every year; it's the way of business. Sometimes, it pays off. When it doesn't, she takes the loss and learns from it -- usually; she is a stubborn Asian mom afterall. Hopefully, she makes up for it in the next year. I couldn't do it. It takes a particular personality.

[dk]

It sounds like there is a lot to learn from your mom in terms of business. I really enjoyed reading this. :)

Accounting is the topic of the week in a course I'm taking right now which is what sparked the question I had to ask. Thanks again. :)

[okisteve]

Taking risks successfully requires knowing your market, and accountants are neither good at that, nor are they paid to do that. That's what Asian moms are for, and I'm sure the reason I've never had a lot of success in business is that I never had one!

Seriously, it pays to do your own bookkeeping so you know what your cash situation is, rather than waiting until you bring your pile of receipts to the bookkeeper. Software like Quickbooks make it easy. It makes job costing a snap and can do all sorts of projections like cashflow, receivables, etc. if you feed it the right information. It will generate your P&L and Chart of Accounts and that helps if you are inclined to pay your taxes on time or at all. I haven't used it in a few years and there is definitely a learning curve, but I could help someone who needs to learn it.

[dk]

I understand it's best to know how to keep your own books, but I'm mainly wanting to look at this from the perspective of people who own a business who are able to staff a full-time accountant. If I were to start a sole-proprietorship, I would positively want to learn to keep my own books in the beginning, but as the business grew, as accounting is a very tedious task, I'd want to be left to the decision-making process and employ different people for specific duties.

Once a business reaches a certain size, it's impossible to do everything. Well, it might be possible for a while, but after a certain point you'd be so bogged down that you wouldn't be able to make quick decisions or even have time to consider new ideas.

But thank you. I agree, but only to a point where it comes time to hire on additional staff.

Taking risks successfully requires knowing your market, and accountants are neither good at that, nor are they paid to do that.
I agree, which is why I think accountants should be there to do what accountants do best, but management needs to familiarize themself with accounting to the extent that they are able to analyze the data and make their own decisions. Otherwise, the accountant is the real boss.