What Do Different Financial Professionals Do for My Business?
Not all accountants and finance people are created equal. Depending on their education and chosen specialization, different financial professionals will do different things to support businesses as a part of their career. Today, I thought it would be helpful to break down some of the common titles and financial professionals and give a quick overview of what they do to support businesses.
Financial Statement Auditor
A financial statement auditor is hired by the company to perform an audit of the company's financial statements. Auditors are typically hired because a regulator (the SEC), investor, or a lender requires the company to have it on it so they have some third party assurance over the company's financial position. While the auditor does not work to directly support the company's operations, they are essential in keeping businesses compliant with various requirements.
Bookkeeper
Bookkeepers are primarily responsible for recording transactions for the business and maintaining the ledgers that support the company's financial position. While it might sound like a simple task, the role of bookkeeping looks different in every business depending on what the business needs. Some bookkeepers will only do things on the cash basis and not record any payables or receivables associated with accrual basis accounting. Other bookkeepers might do the fundamentals of accrual basis accounting and include those payables and receivables, but not many GAAP adjustments for things like leases and revenue. Because of the wide range of responsibilities, a bookkeeper can have, be sure that you hire the right one for your business needs!
Financial Analyst
A financial analyst helps companies make informed decisions about financial planning. By using various tools to analyze financial data and present information, a financial analyst can conduct research, make recommendations, and develop financial models to help inform business decisions.
Tax Accountant
Like the title implies, a tax accountant is one that specializes in some of the many ways that taxes can affect your business, which may include preparation, accounting, and planning for those income and other types of taxes. Most businesses will outsource this responsibility to a CPA firm that can handle pretty much everything tax related once they are provided the right documents.
Valuation Specialist
When it comes time to sell your business, it's important to know what it might be worth to a buyer. Valuation specialists are financial professionals that specialize in assigning value to businesses. To value a business, these specialists typically choose an approach based on assets or discounted cash flows to create a report that can be used to help buy or sell the business. While some business valuation specialists are accountants and CPAs, this is not always the case because the valuation process is more of a financial analysis exercise that doesn't require debits and credit knowledge.
As always is the case, the job descriptions and responsibilities for titles like these at any company will vary because the variety and depth of responsibilities will depend on the size, complexity, and budget of the business operations. The important thing to remember is that it is crucial to find the right professional for your business needs!