Why your accountant can’t fix your finances

Transcript

* Transcript created by AI – may contain errors or omissions from original podcast audio 

Something I hear business owners say a lot is I don’t need to worry about my finances or my accounting because I’ve got an accountant. Now, today’s episode of the podcast is a really important one because I’m going to be sharing why your accountant can’t fix your finances.

Diving into the episode, something that I’ve noticed is that a lot of business owners think they don’t need to get across their finances themselves because they have. an accountant or a bookkeeper. Today, I’m going to run through some of the reasons that it’s not good enough to leave your numbers to your accountant and why you have to be in the detail yourself.

Now, the first reason is because your accountant doesn’t know your business like you do. They get to see a snapshot of your business, maybe every couple of months. I know some people only see their accountant once a year. They have limited information about the day to day of your business. They’re not invested, nor do they understand your growth strategies, and they probably aren’t that equipped to be supporting you in decisions around investments and areas to cut expenses. They’re just looking at it, as the numbers on the page without really having that insight to your client base, your brand, and your vision for the business.

The next reason is because no matter who you employ, they can’t change your habits. So even if your accountant looks and says, okay, here’s the game plan your business isn’t profitable, you need to cut back on this. They can’t actually make you do it. They can’t change your spending habits. They can’t make you invest in certain things. They can’t really get you to take the action inside your business. If you’re not putting money aside for tax, if you’re not showing up in your marketing, and actively growing your business, your accountant can’t change your habits and therefore they can’t change the outcomes that you’re achieving in your business. Ultimately, it comes down to you.

The next reason is another biggie and something that people don’t understand. And it’s the fact that you should never blindly trust anyone in your business. I’m sure you’ve seen in the media, the stories about well known people, intelligent, educated people who have hired people to come and help support them in the space of their finances.

Here’s the thing. People make mistakes, including accountants. And if your accountant makes a mistake, if they do something wrong with your tax, you are responsible for it.

There is this element of human error that is inevitable and absolutely some people are more prone to it than others, but it’s always, always important for you to be across the detail, get across check, sense check the work that your accountant is doing.

I know myself, I’ve absolutely found multiple things over the years from very smart accountants that I’ve worked with. Where I’ve gone, hang on, that doesn’t quite look right. I’m sure you’ve done that, right? Hang on. I think that’s in the wrong account. I’ve picked up quite a number of things over the years that could have cost me both in the bottom line, but also in terms of implications, if I wasn’t paying people properly.

The next thing, and it’s, it’s a bit sad that I have to share this. Some accountants are dodgy. We have ethical standards that we are required to comply by or we could lose our qualifications, our, our reputation. However, that doesn’t stop some people are just flat out dodgy.

Back in the day when I was at uni, I used to work in banking. I was actually a bank teller. And what would happen when we worked at the bank is that they would send around a, like a memo every week of people who got caught stealing or doing fraudulent activity for the bank. I could not believe the volume of people who in a seemingly reputable industry and job were doing the dodgy. And this is the thing, it can happen in any profession. Your accountant might manipulate your numbers. There’s so many things that they could do behind their scenes, and if you aren’t in the detail of your numbers, you could be someone that falls victim to it. Never blindly trust anyone in your business.

And this is a bit of a side note, but I’m going to throw it in here as well. Even your partner, unfortunately, sometimes, again, that happens that people go, Oh, my husband takes care of the finances and they don’t even know what’s going on behind the scenes. And I’m sure you know someone in your wider circle who has had the experience where unfortunately their partner has done something dishonest that’s financially cost them. So make sure that you are being empowered in this space. It’s your business.

The next reason why you can’t just leave all that numbers stuff to your finance expert is because accountants aren’t unicorns.

So while some accountants are specialists across a couple of different areas, it’s extremely unlikely that your accountant is good at everything. As a qualified accountant myself, some of the things that particularly when I was working as an accountant, some of the things I’m really good at is budgeting and analysis. I really enjoyed the creative side of accounting, of understanding what was going on and why. But I truthfully like areas that I wasn’t great at and that I didn’t enjoy so much were things like tax. I wasn’t a big fan of, of heavy processing type work, legislation, systems. What you’ll find is that most accountants have an area or a couple of areas that they’re good at. It’s extremely unlikely that someone’s going to be qualified, like good at all the different things. It’s very unlikely you’ll have an all in one expert as your accountant.

I see too many business owners, who thiks that their accountant is their mortgage broker, their transaction processor, accounts payable, accounts receivable, their asset manager, their advisor, their financial planner, their business coach, their tax expert, and the list goes on.

Your accountant isn’t the answer. A unicorn.

Let me share an example of how this might play out in your world. A former client of mine runs a marketing agency and she shared with me that often potential clients will be having a sales conversation with her and say, yes, I want to do it. And then they go, hang on, I can’t invest in marketing until I check with my accountant. It’s as if their accountant is telling them how to spend their money. Absolutely, there’s value in checking the vibe. Like, do I have enough capacity to invest in this? Absolutely. Or, or asking the opinion of even your business coach.

It’s funny how so many people are so disempowered with their finances that they check with someone else about how to spend their money. Your accountant isn’t a unicorn.

The next reason why you’ve gotta be in the detail of your business and don’t just leave it to the finance experts is because they are not as invested in your business as you are.

Now, I’m not saying that your accountant doesn’t care, but no one will care about it like you do. I’m gonna share an example. If you’ve got kids, you might be able to relate to this one. I remember I used to chat to my brother before he had kids and I would say, Oh my gosh, guess what? Guess what my son did? He said mama today. And he’d be like, yeah, wow. The kid’s a genius. Right? He’s a single bloke. He’s like, whatever. And now that he’s got kids, he will be like, Oh my gosh, guess what my daughter did? And he’ll be like, I’ll send you the video. I’ll send you the video because it’s his baby. He super cares about something, right? And this is the thing. No one else is going to be as invested in your business baby, as you are.

It’s your business. You are the CEO. It’s your profit. It’s your reputation. It’s your future. You are accountable for what goes on in your business.

Even legally, you can’t outsource responsibility for your taxes. If you aren’t meeting your tax obligations, you can’t go, well, my accountant said that and just dust your hands of it. It’s your accountability, your responsibility.

Hopefully what I’ve shared today has shown you But you can’t just say, I don’t need to worry about my finances. I’ve got an accountant. This is why I bang on about learning your numbers, about being able to challenge or ask questions of your accountant or anyone in your finance team.

This is why I created my course, the Profit Academy Foundations, because I see too many business owners who are clueless when it comes to their hard earned money and giving away their power to someone else. I know a lot of people resist this work, but again and again, I’ve heard from my graduates that it’s not as hard as they thought it would be.

So before we wrap up a quick recap of why your accountant can’t fix your finances. Firstly, They don’t know your business like you do. The next reason they can’t change your habits. Thirdly, you should never blindly trust anyone in your business. It’s always good to cross check things. Number four, your accountant isn’t a unicorn. They’re not going to be experts at anything and everything finance related. And lastly, they’re not as invested in your business as you are. It’s your business. And it’s your responsibility.

Thanks for tuning in.

* Transcript created by AI – may contain errors or omissions from original podcast audio