What Are Private Accounting Services?

If you’re reevaluating the financial side of your business, you most likely spend a lot of time thinking about accountants and whether they’re worth the cost.

After all, small businesses are always trying to find new ways of minimizing their expenses, which unfortunately leads to many managers and CEOs doing overtime to avoid hiring a professional. 

This may save you some money in the short term, but think about how much time you’ll lose, and more importantly, consider how the extra effort will harm your organization’s overall productivity. Thus, doing things alone could far outweigh the costs of hiring a third-party expert. 

Today, we’ll explain what are private accounting services, why they’re worth the costs, and ultimately, how you can benefit from them.

Private Accounting Explained

If you’re wondering what are private accounting services, you’re not alone since most people typically use the umbrella term “accountant” when talking about individuals offering financial services to businesses.

It’s pretty simple - private accounting is a service that provides business and financial advice to organizations such as small businesses or individuals. These services are typically not available on a large scale and are primarily aimed at smaller organizations with similar sets of needs.

In other words, private accountants offer services to fewer clients.

Generally speaking, individuals or firms that offer private accounting services have less experience because they’re hired on a per-project basis instead of working in a company as a part of the internal team - which is something we’ll address in a few moments.

Why Use Private Accounting Services?

Now that you know what are private accounting services, it’s time to go deeper into how your business can benefit from using them.

In short, working with a private accountant is a good choice for small businesses. Why? They offer a more personalized service and are a lot more flexible than other types of accounting service providers.

A private accountant will most likely be familiar with your business, and they’ll have a deeper understanding of your overall goals. Using their knowledge of your company’s needs, they’ll be able to provide you with a better service perfectly aligned with your vision. 

Furthermore, if flexibility is your main concern, a private accountant is the way to go. They’re available at all times, and you’ll never have to worry about booking an appointment months in advance, which can be a lifesaver, especially if you need to resolve an immediate problem.

For small businesses that can’t afford a specialized service, private accountants are a better choice as they don’t have much overhead and can typically charge a lot less for their services than public accountants. 

Why Use Public Accounting Services

For the sake of objectivity, even though the main goal of this blog post is to explain what are private accounting services, we need to look at both options.

Even though private accountants are highly trained, they’re generally not regulated . In contrast, public accountants are required by law to abide by a multitude of strict rules and regulations that their private “brethren” don’t need to worry about.

But the biggest strength of public accountants is that they offer more specialized services and are focused on a single niche, ensuring they provide the highest level of expertise possible. 

Compare this to private accountants who need to fulfill different roles, and may do everything from taxes to budgeting, without necessarily specializing in either.

Do You Need An Accountant Or A Bookkeeper?

These two are often lumped together, but aside from the fact they deal with financials, they’re quite different. Bookkeeping is the process of documenting financial transactions, whereas accounting involves analyzing and reporting financial data.

Accounting services may include the preparation of financial statements or tax returns, and making sure financial transactions are compliant with state and federal law, while bookkeepers simply record transactions. 

Are Accountants Worth It?

Regardless of whether you go for private or public accounting services, your organization will benefit greatly . 

An accountant (management accountant to be precise) will gather financial data you can use internally to make next-level business decisions. For instance, they may offer guidance regarding the amount of inventory needed, or which employees are financially feasible.

With this insight, you can identify problems early, before they evolve into a full-blown catastrophe that can directly affect your bottom line. To put it differently, by consulting an accountant on your finances, you optimize costs while ensuring that your company operates in a financially sound manner.

Moreover, with accounting services, you’ll be able to track exactly how much money is coming in and how much money is going out. That way, you can allocate resources accordingly by categorizing all expenses.

For instance, some expenses are immediate, while others are categorized as capital expenditures or CAPEX in short - think spending money on something that will last multiple years, such as a new Cisco server, or switch.

You may need professional assistance categorizing these two types of expenditures as not all expenses are as clear-cut as they seem on the surface. While capital expenditure may cost you $100k, it could potentially bring in about $10mil of revenue. On the other hand, a simple expense of 50$ could only result in $80 in value over time - which doesn’t offer much in terms of ROI.

Lastly, an accountant can help with capital budgeting. For example, they may help you list all your expenses which they’ll categorize by type. Then, an accountant can estimate future expenditures based on factors that may affect the amount of funds available in a certain period. 

With an accurate budget, you can compare your business expenses against projected amounts, allowing you to fine-tune your expenditure as needed. 

Keep in mind that no budget is set in stone, and you should revise it with an accountant regularly. That way, it will reflect your current financial circumstances and help align them closer to your overall business goals.

Overhaul your finances

With insight into how hiring an accountant can help, and knowledge of what are private accounting services, you’re well on your way to making an informed decision regarding this crucial aspect of your business. 

If you’re looking to hire readily available financial advisors on a part-time, or full-time basis, Griffin Global has you covered. As one of the most technologically advanced staffing agencies in Florida, we’ve connected many small organizations with carefully-vetted private accountants, ready to assist you whenever you need - with minimal wait times. 

Ready to overhaul your finances? Fill out our contact form or call (855) 747-4334 and get financial help ASAP!