You may be asking yourself, “What is a trusted advisor and how does an accountant factor into this?” A trusted advisor can be anybody: a business friend, your bookkeeper, or even a family member. In a nutshell, it is someone who you connect with and can provide sound advice.
Your trusted advisor knows your goals and will help you achieve them. They desire to see you succeed according to your own definition of success. You can go to your trusted advisor for anything, such as to review potential big purchases or to bounce ideas off. You can also expect your trusted advisor to bring up pertinent issues and to help you proactively manage your business.
Many small business owners find themselves with only family as their trusted advisors. While I’m certain your family has the best intentions in helping you, they may not be experienced in the specific challenges facing your business.
Furthermore, not every accountant is interested in being your trusted advisor. Their practice may be focused on solely maintaining the books, taxes, or other compliance work. To better your chance of success, you need more than the compliance work. Managing the books is just the tip of the iceberg of the total value an accountant can provide.
Carefully choose the accountant you partner with and ensure that they will be a trusted advisor. Also, beware of an expectations gap between what they will do for you and what you think they are going to do for you. Review the engagement letter or service contract and ask for references.
The number one complaint by small businesses about their accountants is that they are more reactive than proactive. A trusted advisor focuses on helping your business grow proactively, instead of merely managing the compliance tasks.
Stay posted. My next blog entry will list examples of how a trusted advisor goes above and beyond basic bookkeeping to add value to your business.