Manufacturers are usually focused on improving production, not on which CPA firm is best suited to meet their accounting needs. Unfortunately, this inattention is contrary to their best interests. When a manufacturing company fails to give the right CPA firm the attention it deserves, it might end up with a company that doesn’t understand its industry-specific needs.
The manufacturers of today are competing against firms from all over the world, so it’s vital to stay up to date on the latest accounting technology. However, this is only possible if the CPA firm they select is familiar with their industry and uses this technology to meet the manufacturer’s specific needs.
What Manufacturers Should Look for in a CPA Firm
Manufacturing companies should choose a CPA firm that has experience in their particular industry. They need to understand the manufacturer’s processes from start to finish and use this knowledge to deliver timely financial information that addresses a manufacturer’s needs. This will ensure that the client receives all the tax credits they deserve and can maximize its financial potential.
A manufacturer won’t feel comfortable working with a CPA firm that doesn’t have a deep understanding of its company’s internal workings. Without a certain level of comfort, the relationship isn’t going to be very productive. This is because the manufacturer will be hesitant to share information that the CPA firm needs to maximize its tax credits and deductions.
Manufacturers who do commerce in international markets should hire a CPA who has experience with international tax laws, so that the CPA can leverage these laws to the client’s advantage and keep the client’s taxes separate from their bookkeeping services. It also helps if the CPA has established relationships with international tax attorneys. Taken together, these different types of international experiences can contribute greatly to a manufacturer’s expansion.
The Importance of the CPA Firm’s Reputation
It’s important for a manufacturer to look at a CPA’s past performance. For example, how have they performed with similar clients in the past? Additionally, is the CPA adaptable enough to make changes quickly if the manufacturer experiences explosive growth? Lastly, how much experience does the CPA have with mergers and acquisitions? The answers to these questions should factor largely into the manufacturer’s final decision.
The accounting needs of manufacturing companies are often incredibly complex. As a result, manufacturers should work with CPAs who can do crisis management, financial projections, R & D analyses, and succession planning. The best way to find out whether or not the CPA firm is capable of all this is to explore how they’ve performed for manufacturing companies in the past.
In other words, it’s essential to look at the CPA’s reputation. In addition to high competency levels within pertinent manufacturing areas, the best CPA firms stay on good terms with firms they’ve worked with in the past. Past performance is a good indicator of what the CPA can accomplish in the future, and manufacturers must do as much research on the firm as they can.
Hiring the right CPA firm will go a long way towards building the manufacturer a solid financial foundation. Not only is this kind of foundation essential to the company’s chances for long-term success, but it’s only by understanding that every manufacturer is different that a CPA can help build it. Finding the right CPA firm might require a significant time investment, but it’s one that will pay great dividends over the long haul.
About Esther Kim
Esther is a licensed Certified Public Accountant (CPA) and Certified Fraud Examiner (CFE). She obtained specialized designations in the accounting field as a Certified Financial Forensic (CFF), Chartered Global Management Accountant (CGMA), and Certified Information Technology Professional (CITP). She has worked in the capacity of an interim Chief Financial Officer, interim controller, and financial consultant for several small and medium sized companies for over 10 years. Esther specializes in high potential start-ups from the conceptual stages, such as formulating business plans and helping obtain seed funding, to scaling them in putting infrastructure and systems in place for rapid growth. She graduated with a Bachelor of Arts degree from the University of California, Los Angeles (UCLA) with a triple major in Economics, East Asian Studies and Sociology within four years and obtained a Master of Public Policy degree, and a Master of Arts in Humanities with distinction from California State University Northridge (CSUN).