Why your accountant shouldn’t know your business financials better than you

Rose-Marie Almond, Toronto, ON, CYBF volunteer

Accountants are fantastic people. They take the worry out of business finances for most new entrepreneurs, and that’s a good thing; but they should never be used as a direct substitute for basic financial literacy.

Here are just three of the reasons why:

1. Cash flow. Accountants don’t generally deal with your day-to-day finances; that’s up to you. You should always know what’s coming into and out of your business daily so you can maximise profits. Understanding profit and loss and balance sheets are a must!
2. Making the most of tax refunds. An accountant can definitely help you get the most that you are entitled to and take the nasty paperwork off your hands, but by increasing your understanding of what can be reclaimed, you can make better business decisions all year round which will help during the tax season.
3. Budgeting. Having a good understanding of the financial commitments of your business, even as simple as knowing what bills are due when, will let you build more comprehensive budgets. This in turn leaves much less room for nasty surprises.