2020 and 2021 brought unprecedented challenges that forced businesses to do things differently than they’d been done before. What will the rest of 2022 bring? Who knows?—but as long as your business’s foundation is solid, you’re ready for anything. Making sure your business accounting situation is well managed is part of creating that solid foundation. There will be plenty of surprises ahead in 2022. The fewer accounting-related surprises your business has to navigate, the better.
1. Brace for continued inflation and supply chain issues that will make costs unpredictable.
Some of the top challenges that plagued American businesses in 2021 are going to continue to be challenges throughout 2022. The supply chain breakdown that began with the pandemic isn’t expected to be fully resolved in 2022. Inflation is also expected to continue to rise through this year.
Business owners should expect shipping delays to continue and for prices to remain high for many goods and services—but as the pandemic has proven, it’s impossible to predict exactly what the future holds. There’s no telling when inflation will start to slow down or how much prices might drop when it does. Speak to your CPA about how to account for high (yet unpredictable) costs as you map out your business accounting plan for the rest of 2022.
2. Assess how well your current business accounting systems are meeting your business’s needs, and rework them if necessary.
This is an evergreen business accounting tip for good reason. In the course of a typical busy work week, business leaders have to keep a lot of plates spinning. There’s just not a lot of time to analyze things like how efficiently the organization’s receipt management or invoicing systems are working, or where its accounting weaknesses are.
Meeting with your CPA can be the impetus to assess how well those systems have really been working for you over the last year. It may be useful to solicit feedback from anyone on your team who has a hand in any business accounting tasks. Have they noticed any recurring problems or inefficiencies in the way your business manages its accounting? Do they have suggestions for improvements?
3. Review your tax strategy and reflect on tax challenges from last year to make taxes easier in 2022.
Every tax season is a little bit different because both your business and the tax code are constantly evolving, but there may be lessons to learn by reflecting on any tax challenges that came up for your business in recent years. Did you have any problems with inaccurate or incomplete records when you sat down with your business tax advisors? Did you take a much bigger tax hit than you were anticipating, or pay IRS penalties? What can you do this year to make filing business taxes a little easier?
Your CPA and tax advisors can also help you start to strategize around any upcoming tax changes that might affect your business over the next several years. It’s useful to start thinking now about how pending tax legislation or future changes to your business structure could alter your business’s tax obligations over the next several years.
4. Lighten your accounting load to give yourself more time to focus on the work of running your business.
Small business leaders naturally have to manage a lot of the day-to-day accounting work when an organization is starting out. Administering payroll, managing accounts receivable and accounts payment, recording expenses and reviewing financial statements are just some of the tasks that a small business owner might take on in the early days, in addition to all the work of growing their business.
As the organization grows and scales up, business leaders need to shift their focus to more big-picture thinking and let go of some of the tasks they owned when the business was getting established. If you’re still spending more of your time on business accounting tasks than you’d like to be, it’s time to evaluate your options for outsourcing. From payroll companies to full-service business accounting firms, there are a host of ways your business can bring in outside accounting help to free up more time for you and your team.
5. Lean on your advisors for accounting tips that are specific to your business’s financial goals.
General business accounting tips may help your organization streamline some processes and identify areas for improvement, but there’s no substitution for the personalized guidance your CPA and other financial advisors can provide.
Your short-term and long-term financial business goals have to be part of the conversation when you’re talking to your business accountant. For example, do you plan to expand your workforce this year? Are you thinking about renovating your facilities or investing in new technology in the next few years? Is there a new market you plan to move into? Where do you see the business being in five, 10 or 15 years? An experienced CPA can help you start strategizing around the financial elements of your future plans, charting a course to take your business where you want it to go.
Sachetta, LLC’s advisors provide a range of business consulting services, including business accounting. We’re here to help business leaders make sure all the necessary financial pieces are in place so they can focus on running and growing their businesses. Contact us today.
Georgios Liakakis, CPA, MSA is a Certified Public Accountant and holds a Master’s Degree in Accounting from the University of Massachusetts Lowell. He joined our team in 2016 and focuses on both business and individual taxation.