Public accountants work in or operate accounting firms that are hired by external clients to perform various accounting or consulting functions. Private accountants work for businesses or within organizations that have enough need for accounting services that it’s worth allocating their resources to hire someone internally.
The vast majority of small businesses in Phoenix do not have private accountants on their payrolls. It doesn’t make sense for a small business to pay someone $60,000 a year to do basic bookkeeping, payroll and business taxes when a public accountant can do all that and more for far less.
There are a variety of scenarios in which even large companies that have teams of private accountants still have to contract with public accountants at CPA firms. A standout example is external audits, which are impossible for companies to perform on themselves.
It’s vitally important that third parties, like lenders, investors or stakeholders, have honest and transparent data on a company’s health, growth and performance. While there’s no guarantee that companies will be dishonest on internal audits, the entire system works better with a mandatory level of trustworthiness and accuracy. Having external public accounting firms perform these audits ensures there are no real or perceived conflicts of interest.
Companies bring in consultants for analysis and advice on processes, accounting practices, cash flow management or a host of other potential business needs.
External consultants bring a fresh, unbiased perspective to the table, helping to identify issues or areas of improvement that internal team members might overlook due to their close proximity to the company’s operations. This objectivity ensures that the analysis and recommendations provided are impartial, potentially leading to more effective and innovative solutions.
External consultants also possess specialized expertise and experience from working with a diverse set of clients across various industries. This exposure allows them to bring unique insights and best practices that the internal accounting team might not be aware of or have access to. They can quickly address complex issues, implement new systems or navigate regulatory challenges, providing valuable knowledge to the internal team in the process.
Businesses can run into situations where they need extra help to accomplish a specific project or systemic company-wide changes. These types of projects are inherently temporary, so hiring a whole new team of permanent employees to complete them doesn’t make sense. External consultants from public accounting firms are typically the preferred resource.
There are many great accountants working at businesses, but not all of them have the desire to pursue advanced degrees or tackle the exhausting, detail-oriented work of a CPA. There’s also liability and stress concerns to take into consideration. CPAs are held to extraordinarily high standards, and a lot can be riding on their compilations, audits or tax preparation work. Mistakes can result in serious and costly consequences, meaning there’s no room for error.
Simply put, not every accounting professional wants that responsibility or has the attention to detail and commitment to perform at that level. The CPA certification is vitally important for U.S. businesses because it offers a fast and convenient way for companies to identify a professional and hire them with a built-in assurance of their qualifications.
When a business hires a CPA, they know they’re getting the services of an accountant who has:
To even sit for the CPA exams, an accountant needs years of experience in the accounting field, including thousands of verifiable hours working under the supervision of a CPA. Arizona CPAs must also complete 80 hours of continuing professional education every two years to maintain their certification.
It depends on the accounting services your company requires. Payroll, bookkeeping and QuickBooks support may not require the services of a CPA, but compilations, audits and compliance consulting will likely need to be performed by a certified public accountant.
H&H Accounting Services offers the best of both worlds. We have a team of skilled and dedicated accountants to help with everything from tax preparation to bookkeeping and a CPA to assist local Phoenix businesses with more advanced accounting tasks.
Call us at (480) 561-5805 to learn how H&H Accounting Services can meet your accounting needs.
