3 Tips for Choosing the Right CPA For Your Fabrication Business
2019-03-26 | by Gene Reynolds
Choosing the right CPA for your fabrication business is as important as choosing the right materials to complete the assembly of a product.
You need to ensure that the CPA firm has relevant industry knowledge, understands the complete manufacturing process, and can accurately apply accounting practices to your business.
How to Choose the Right CPA Firm In Fabrication
To narrow the scope of choosing the best CPA firm, you should take the time to do your homework and test each candidate’s knowledge of fabrication or manufacturing accounting issues to evaluate their knowledge, expertise, and advice.
Tip #1: Check the Track Record of the CPA Firm
Information is readily accessible to evaluate whether a CPA firm has history working with clients in the manufacturing industry. If you encounter a CPA firm that does not seem to have any experience with fabricators, then you likely do not want to be the guinea pig for the firm to jump into a new industry.
Reach out to the CPA firms that you are considering to have a conversation about their firm and your business. Gauge their expertise and their ability to understand the accounting challenges specific to your industry.
- Does the CPA firm understand the value of time as the central driver of accounting for fabricators?
- Considering the length of lead times in manufacturing, can the CPA firm present formulas they would use to calculate revenue and costs over time?
Tip #2: Present a Hypothetical Scenario to Each CPA Firm
As you begin to narrow down your options, consider walking through a common fabrication accounting scenario. This exchange will help you gauge whether the CPA firm is capable of understanding the issue, analyzing the situation, accurately recording the activity, and strategizing a solution for future recording.
- Walk through a scenario where you manufacture a product that needs to be written off as a loss because the customer no longer needs the product by the time you finish the project.
- How would the CPA firm account for overhead costs, variable and fixed expenses, the cost of material, and other considerations to accurately record this loss?
Tip #3: Have Multiple CPA Firms Perform a Mock Audit
Once you narrow down the CPA firms to a few candidates, consider having each firm perform a mock audit of your past financials.
This step will allow you to see how well they know the fabrication industry in a simulated setting. You will also be able to see if the CPA can find other issues that should be addressed and if they can identify growth opportunities through more strategic accounting practices.
- Evaluate whether the CPA firm can track costs over a prolonged period and use advanced time-based calculations to verify the accuracy of your financials.
- Can the CPA firm perform non-traditional accounting and still achieve accurate and reliable records?
Reynolds and Associates is Capable of Supporting Your Fabrication Accounting Needs
Reynolds and Associates works with small-to-medium sized businesses to support their accounting needs and implement a strategic approach to accounting for their industry, including companies in the fabrication industry.
We would appreciate the opportunity to discuss the specific needs of your fabrication company and how we can provide support for the accounting issues that concern you.
To schedule a free consultation, reach out to our team either by email at email@example.com or by completing our Contact Form.
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