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Sage Survey Shows Majority of Canadian Small Businesses Aren't Using Accountants to Their Full PotentialMost Engage Their Accountants for Accounting and Bookkeeping Services, Tax Support and Payroll Only (April 25, 2012)
RICHMOND, BC -- (Marketwire) -- 04/25/12 -- Sage North America announced today the results of its Accountant Usage Study, a survey focused on determining how small businesses use accountant services. The study found that rather than engaging an outside accountant as a full business partner, a majority of small businesses only look to them for specific services and support, such as accounting, bookkeeping, and taxes. Sage, a leading provider of business management software and services to more than 6 million small and midsized businesses worldwide, conducted the study among 229 Canadian small businesses.
The survey found that 39 per cent of small businesses do not utilize an outside accountant, with the most common reason being a preference to do the accounting on their own (73%). However, the 61 per cent of small business owners who look to outside accountants for their expertise mostly rely on them for accounting services (77%), bookkeeping services (53%), tax support (personal and corporate tax, 46% and 36% respectively), and payroll (34%).
"While the survey indicates that 90 per cent of small business owners realize that their outside accountant is critical to their success, most are not using these experts to their full potential," said Jennifer Warawa, vice president, partner programs and channel sales, Sage North America. "Accountants offer so much more than general accounting and tax services; they can provide critical guidance that can help take a business to the next level. All businesses, big or small, need a plan and a good accountant will partner with a business to examine all the data to help build a roadmap to success."
Some other services that accountants provide and are less used by small business owners including business tax compliance and auditing -- with only 31 per cent of small business owners reporting, in both instances, that they receive these services -- and financial planning/consulting (25%).
The study, which was also conducted among U.S. small business owners, showed some significant differences in accountant usage between organizations in each country. In fact, the survey revealed that U.S. small businesses make far more use of external accounting services for business tax compliance (55% versus 31%) and financial planning/consulting (41% versus 25%) than Canadian small businesses. Canadian small businesses value an outside accountant's bookkeeping services substantially more than their U.S. counterparts (26% versus 5%).
Other findings from the survey include:
- 42% have been audited with 84% stating that an outside accountant was 'very helpful.'
- Most small businesses began using an outside accountant within the first year of operations: 30% 'right at start-up'; 35% 'within 6 months from start-up'; and 15% '6 to 12 months from start-up.'
- 52% of small business owners found their outside accountant through a referral.
"Sage works with millions of small businesses around the world and with tens of thousands of accountants. We have seen the value that a strong partnership between the two can bring and encourage business owners to explore expanding their accountant relationship," said Warawa.
To determine if an outside accountant is a good fit for their business, small business owners should consider:
- Accountants can bring financial information to life. An accountant can help small businesses dive into data and use the findings to propel greater business growth and profitability in the future.
- Accountants can provide a new perspective. Someone who is removed from the business can provide a different perspective that may otherwise be missed.
- Accountants have reach. Don't underestimate how valuable it is to receive guidance from someone who has insight and knowledge across hundreds of businesses and industries.
- Accountants understand tax. Rules and regulations change on an almost continuous basis; aligning with an accountant can help small businesses ensure that their business remains compliant which is a critical step in maximizing tax savings.
Sage is a leading global supplier of business management software and services for small and midsized businesses. The Sage Group plc, formed in 1981, was floated on the London Stock Exchange in 1989 and now employs more than 12,300 people and supports more than 6 million customers worldwide. For more information about Sage in North America, please visit the company website at: SageNorthAmerica.com. Follow on Facebook, facebook.com/SageNorthAmerica, and Twitter, twitter.com/SageNAmerica.
© 2012 Sage Software Canada, Inc. All rights reserved. Sage, the Sage logos, and the Sage product and service names mentioned herein are registered trademarks or trademarks of Sage Software, Inc. or its affiliated entities. All other trademarks are the property of their respective owners.
Sage North America
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