Seven Topics You Should Discuss with Your Accountant Every Year

Small business owners often use the New Year as a time to plan annual budgets and focus on sales growth and new business opportunities. But it's also a great time to make resolutions to review accounting practices and financial controls on the business. This is especially true in 2010, as businesses are likely to face another economically challenging year. "I find it helpful to set up an annual business review with my accountant," says Steven Hastert, president of AccountingAisle.com. “That way we can review everything from cash flow planning, to tax updates to how another person views my business. I find it useful to get another perspective."Hastert says he prepares for this meeting in advance, with a targeted list of items to discuss with he company's CPA. "Like most small business owners, I'm acutely aware that I'm paying for this time by the hour. I need to make the most of their time and my money." Here are the seven steps you should take to prepare for your annual accounting review:

1. Review year end financial statements and compare 2009's results to company's previous performance. What has changed? Examine financials each month, but it's important to look at trends over the year. Ask your accountant to review the information as well. Get a second opinion on the financial health of the business.
2. Project cash flow for the upcoming months. This provides a road map for you to plan for upcoming business expenses, and helps you forecast sales and revenue. Forwards a copy of your cash flow report to your accountant for review prior to the meeting.
3. Review pricing strategies. One way to improve profit is to increase prices for your goods or services. However, in our current economic environment, it could also cause significant loss of customers. An accountant might provide valuable insight into your current strategies and other factors to improve the company's profitability.
4. Inquire about changes in state, local and federal Tax Laws that will affect the business.
5. Review accounting software packages. During this meeting, take the time to inquire about your accounting software. Is it time to upgrade to a new version of the software? Has your company outgrown its current marketing practices? Without asking this question, you'll never know.
6. Consider applying for a line of credit or changing merchant accounts. As a business owner you must prepare for emergencies, especially in uncertain times. While your company might not need access to a line of credit right now, it could in the future. It is easiest to establish credit when the business is not under duress, and your accountant might have a personal relationship with a banker that you should take advantage of.
7. Is there anything else? Ask this open-ended question of your accountant. They might be able to get an insight you would miss otherwise.