“Size Matters” When Hiring a CPA Firm, Specializing in Serving the Needs of Real Estate Businesses
Originally published on January 11, 2015
Updated on November 1st, 2023
How does one go about hiring the right CPA for their real estate business? Ask any number of professionals and friends for a referral to a good CPA and you’ll likely get a variety of recommendations. But, will these CPAs be knowledgeable in your industry? Will they add value to your real estate business?
Two key variables that shape the appeal of a CPA firm are size and specialization. The two go hand-in-hand; with size comes efficiency and reliability, and specialization provides a deeper knowledge of the industry.
LARGER CPA FIRMS CAN BETTER SERVE REAL ESTATE BUSINESSES.
Larger CPA firms, versus a sole practitioner, are more likely to have a real estate segment with a team of CPAs who “specialize” in serving the needs of the real estate industry. These CPAs focus their careers on finding ways to improve profitability for real estate companies through specialized services, including: tax saving strategies, debt restructuring, cost segregation services, HUD requirements, development activities, sales tax, budgeting and cash projections, section 1031 exchanges, and other tax deferral strategies. Developing these sophisticated services for real estate companies is generally the culmination of a decade’s worth of research, experience, and advanced technological resources. An accounting firm with a vast real estate clientele and an experienced CPA team will develop the services that ultimately advance the industry.
These CPAs may also possess personal experience within the real estate industry, making recommendations on property management, rental rates, and financing, to name a few. A relationship with these CPAs extends far beyond the traditional CPA-client model. They work closely with real estate companies to develop long term financial strategies to maximize bottom line profitability.
BECAUSE TWO IS BETTER THAN ONE.
Instead of working only with one or two real estate companies a year, a firm with a real estate niche will have a large and diverse clientele within the industry. These firms work with smaller companies poised for growth, as well as larger and more sophisticated companies seeking highly specialized services.
Having a team of CPAs at your disposal is also better than one; especially if the one doesn’t “specialize” in real estate. A team of CPAs will draw from their experiences working with a larger clientele to exchange ideas and identify non-traditional tax saving strategies to ultimately add value to their clients.
Another advantage of using an accounting firm is the reduced cost that comes from trusting in efficient and knowledgeable CPAs who can improve your financial reporting, identify tax saving strategies and offer smart financial advice without having to add to your payroll.
LARGER FIRMS OFFER A BROADER RANGE OF SERVICES.
A larger CPA firm not only provides services specific to the real estate industry, they also offer nontraditional services that add value to any CPA-client relationship. Larger firms are constantly keeping up with innovative advancements and new technology, better equipping them to offer information technology services, wealth management, and outsourced accounting services. They can even provide CFO services to help maintain financial health and fluidity within a company. These firms will provide consulting services aimed at streamlining processes and improving realization to ultimately help companies make more money.
A LARGER FIRM IS MORE LIKELY TO HAVE AN EXPERIENCED NETWORK.
A larger firm has an established reputation – drawing in new and returning businesses. These firms can draw upon their extensive and experienced network to help their clients make valuable connections. Sometimes in business it’s not what you know, but who you know that will propel your company to the next level.
With all things considered, it’s highly recommended that real estate companies seize the benefits and advantages provided by a larger CPA firm. With the dependable expertise, vast service offerings and specialization offered by a larger firm, clients are assured to make the most money possible and pay the least amount in taxes.
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