Making sound financial decisions are crucial to the success of any size company. A financial professional will help you understand and chart strategies to help you manage a profitable company, but for many, there may be confusion regarding the respective services of a Certified Public Accountant (CPA) or a virtual Chief Financial Officer (VCFO).
What your business needs will determine what level of financial professional you need. To clear the air, the virtual CFOs at Gonzalez & Arrambide want to discuss the differences between all of these roles so that you can get the most benefit for your business.
The Differences Between a CPA and a VCFO
A moderate sized company with revenue ranging from $2 million to $20 million may have senior executives rely on the advice of their CPA for matters involving certain business finances. In these instances, the CPA will offer a financial opinion based on experience with taxes and tax law, rather than offering insight related to long-term financial advice for the business.
The responsibilities of a VCFO go beyond tax advice and basic accounting. In a nutshell, a VCFO helps with business planning, forecasting, negotiating, and business budgeting, all of the same kind of responsibilities a company Chief Financial Officer (CFO) would do. A VCFO, on the other hand, saves a company money because they aren’t paying for a full-time employee with benefits.
It’s important to note that you don’t need to be a CPA to be a VCFO, and CPA’s aren’t always well-versed on managing complex corporate finances that a VCFO can.
Let’s elaborate a little bit on these roles now.
More Into the Role of the CPA
In the simplest of terms, the CPA is in the business of tax return preparation; that is their primary responsibility. A CPA may collaborate with a VCFO to provide tax advice that will ultimately help guide the company’s financial decisions based on short term and long-term objectives.
The CPA’s knowledge revolves around taxes and tax laws that lend to the strategies that may be developed by an outsourced CFO. Often, a company may mistakenly look to a CPA for business advice that may be best handled by an individual with a background as a VCFO. A CPA will help a company thrive by performing a range of duties including:
- Organizing and updating accounting records
- Staying abreast of tax laws
- Tax preparation and analyzing reports on transactions
- Conducting regular, detailed audits
- Manage financial documents, expenditures, and investments
Consider a VCFO to Help You Strategize While Saving Money
When evaluating the financial goals and objectives of a company, an outsourced CFO will bring strategies and insight that a CPA may not be equipped to handle. A qualified and experienced VCFO will focus on future cash flow and offer expert advice on operational planning to ensure a company is sustainable. In addition, a company may choose to hire a VCFO in order to:
- Chart a financial strategy
- Forecast growth
- Outline sustainability by addressing expenses and highlighting assets
- Improve profitability
- Control expenses and cash flow
- Establish strong financial relationships
- Assess financial risk
- Finance project management
- Liaison shareholder relationships
Ultimately, a business may decide to hire a CPA, a VCFO, or both based on a range of factors exclusive to your company’s needs. Whether you’re a growing business or an established company, hiring the right team can make all the difference in your financial outlook.
The Virtual CFOs at Gonzalez & Arrambide Offer Trusted and Sound Service
Founded in 1996, Gonzalez & Arrambide, Inc. has become a respected and recognized accounting firm dedicated to helping individuals and businesses of all sizes with their business needs and strategy. Our commitment to services ensures we give you what you need to succeed and grow your revenue streams.
At Gonzalez & Arrambide, we offer our clients Virtual Chief Financial Officer (VCFO) services and have helped them improve financial management without spending the substantial resources needed to hire someone in a full-time role.
Serving the entire Rio Grande Valley Greater Metro and located in Weslaco, our VCFOs are more than qualified to meet your business needs.
Starting and running a successful business can be a challenging adventure, especially when it comes to deciding on the method in which you choose to handle your business’s finances. There’s always the option of in-house financial management or even online software. However, for most businesses, hiring a bookkeeper or a Certified Public Accountant (CPA) is the most effective manner to ensure that your books are accurate, your tax preparation is in order, and your financial systems exceptional.
But even then, it can be difficult for a business owner to fully understand the differences between a bookkeeper and a CPA.
While the two share common goals, bookkeepers and CPAs do play different roles in the financial cycle. Generally speaking, a bookkeeper will work with you much more frequently to maintain proper coding of incoming funds and expenditures while providing you daily financial updates and reports. On the other hand, you may not touch base with a CPA as often, but they can provide you more insight into your finances as a whole and can offer proactive tax advice. CPAs can analyze your financial situation in its entirety and perform audits to provide holistic business advice.
Your trusted team of financial advisors, which can include a CPA and bookkeeper, should work in unison to focus on what is best for your business and financial needs.
And this is exactly how Gonzalez & Arrambide, Inc. works. Our office provides a comprehensive list of services that can meet all of your needs – from quality bookkeeping and small business accounting services to full-fledged CPA expertise – Gonzalez & Arrambide, Inc. can get the job done.
Now let’s get a bit more in depth to understand the differences between a bookkeeper and a CPA.
What is a bookkeeper?
Bookkeepers perform the daily accounting functions of a given business. Their responsibilities usually include maintaining accurate books, tracking accounts, and developing procedures to track monies. A bookkeeper’s education can vary between being self-taught with several years of professional experience to having an associate’s degree. An accountant will usually supervise a bookkeeper’s work.
What is bookkeeping?
Bookkeepers of course deal with bookkeeping. Bookkeeping is the record keeping of daily transactions to help a business track its income and expenditures in a manner that will help it to maintain a strong business model.
The processes of bookkeeping can include, but are not limited to:
- Maintaining and balancing general ledgers
- Recording financial transactions
- Posting debits and credits
- Producing invoices
- Completing payroll
Your bookkeepers primary role will entail managing the general ledger. The general ledger can be created with specialized accounting software, a computer spreadsheet, or even a lined sheet of paper, and will be used to track the amounts from sale and expense receipts. The level of knowledge your bookkeeper will require is dependent on the size of your business and the number of transactions that take place on a daily, weekly, and monthly basis.
What is a CPA?
Certified Public Accountants (CPAs) are generally required to have a bachelor’s degree in accounting and must pass rigorous testing standards set by the state they wish to practice in. In the state of Texas, after passing the Uniform Certified Public Accountant exam, the individual seeking to become certified must then gain one year of professional accounting work experience under the guidance of a CPA.
The process of becoming a CPA is noticeably quite stringent in comparison to that of a bookkeeper.
Once certified, an accountant can offer a variety of services including auditing, financial consulting, and tax preparation. It’s important to recognize that because CPAs are considered professional experts, their services are usually rendered at a hourly rate.
What is accounting?
While bookkeeping is largely based around transactions, accounting is intended to analyze this compiled information to help produce financial models that will make an organization run more efficiently.
The processes of accounting can include:
- Preparing company financial statements
- Preparing and completing income tax returns
- Analyzing costs of operations
- Analyzing financial entries from the bookkeeping processes
- Assisting a business owner in understanding the impact of financial decisions
The processes of accounting are intrinsically tied in with the processes of bookkeeping, but they help an owner develop a better understanding of the bigger picture of their business, the actual profitability of their services, and the cash flow of the establishment.
Let Gonzalez & Arrambide, Inc. Serve Your Bookkeeping and CPA Needs
The fact of the matter is that when you are looking for a meaningful team of financial advisors, you’ll want your bookkeeping and accounting members to have a great collaborative relationship. Having properly organized financial records and a balanced system to track your finances are both going to be key factors for your business’s success – and they require bookkeeping and accounting practices to work in harmony.
Gonzalez and Arrambide, Inc. can meet all your financial needs – whether you’re a growing business or in need of a bookkeeping/accounting transformation – our team has what it takes to get the job done. Give us a call at (956) 447-9009 to find out how we can help your business grow.
Not every accountant is equal and you shouldn’t just trust any accounting firm with your bookkeeping needs. Work with professionals who have the experience and the credentials. Work with the QuickBooks ProAdvisors at Gonzalez & Arrambide, Inc. to get the service your business requires.
As QuickBooks ProAdvisors, our team of accounting professionals and CPAs can provide you great insights into your business by helping you to capture key data points, manage your QuickBooks procedures, and ensure your business’s financial workflow is effective. In order to be credentialed as a QuickBooks ProAdvisor, a potential candidate must work through a rigorous training process, developed by Intuit, and which tests in areas including but not limited to:
- Advanced functionality of the product
- Troubleshooting errors
- Detailed job costing
- Entering data for sales and invoices
- Analyzing financial data in QuickBooks
Once these courses have successfully been completed, and all tests have been mastered, then the QuickBooks ProAdvisor is officially certified. The level of in depth knowledge and expertise a ProAdvisor can offer you can be an amazing asset to your company should you require more exhaustive services.
Understandably, you may not be too sure if your company requires more specialized and personalized assistance. Well, if you have found yourself in any the following scenarios, then it might be time for you to call Gonzalez & Arrambide, Inc. to get the support you deserve:
- Are you or your staff members entered the same information multiple times?
- Have you had, or are you having, trouble getting any information out of your system?
- Do you need help importing or exporting large data files?
- Have you been trained before but still aren’t confident about how you’re entering transactions and running reports?
- Do you feel like you’re not spending enough time analyzing your data?
- Are you paying for a third party service provider but aren’t benefiting from their help?
- Are your expenses changing and your “Un-deposited Funds” balance growing daily?
- Do you need help choosing which add-ons you need from the Intuit App center?
If you find yourself experiencing any of these issues, then you’ll likely want to contact a ProAdvisor. With access to a variety of resources, ProAdvisors can help you devise a plan that will lead to a long-term relationship between your company and their services. Plus, with cloud computing becoming such a mainstream and vital tool, ProAdvisors are also learning how to effectively utilize it, which means you won’t necessarily have to meet with you advisor every week face to face. Even if you’re ProAdvisor is unavailable at the moment, there is a growing QuickBooks community that can likely help you to solve your question.
Though there are approximately 20,000 Certified QuickBooks ProAdvisors located all throughout the United States, each one receives the same training, guaranteeing that you’ll have someone that can meet your challenges and help you to accomplish your goals.
Gonzalez & Arrambide, Inc. are proficient with QuickBooks Desktop so that if you are just getting started with your accounting setup, we can help you make sure you’re getting the right product for your business.
Our ProAdvisor services also include but are not limited to:
- Helping you choose the right Intuit product and implement QuickBooks for the first time.
- Helping you to upgrade QuickBooks to the right version for your business to grow.
- Helping you to import data from another system in your QuickBooks system.
Partnering with the QuickBooks ProAdvisors of Gonzalez & Arrambide, Inc. is the perfect way to learn QuickBooks as well as help your business to flourish. At Gonzalez & Arrambide, Inc. your financial success is our goal, that’s why you won’t find better support anywhere else.
Call us at (956) 447-9009 to get the help you need.
The popular on-demand media streaming provider, Netflix, has upped their prices and split their company into two causing customers to unsubscribe and other businesses to learn from their mistakes.
The DVD rental service will now be provided by Qwikster at a higher price to those who choose to keep the service.
Changes are inevitable in businesses and like The Business Finance store provides to their clients, legal and business advice along with accounting and bookkeeping are essential when starting up a business and maintaining one.
For this invaluable service to your company, contact the Weslaco CPAs at Gonzalez & Arrambide, Inc. by calling 956-447-9009 today.
If you own a small business, you may be looking to expand. Financially, this may be difficult and dealing with the legalities may be complicated.
It is a good idea for business owners to establish a relationship early on with trusted advisers who can help them achieve their goals.
Whether you are looking to promote your business or make valuable connections, a Certified Public Accountant can help you achieve your business goals.
Contact the Texas Certified Public Accountants of Gonzalez and Arrambide at 956-447-9099 for more information.