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Industry

Small Business Owners

Build Your Business on Better Financial Information

A shop owner standing in the doorway of her business

Small business owners make decisions every day involving customers, employees, pricing, expenses, cash flow, taxes, and growth.

Your accounting system should do more than record transactions. It should provide useful information that helps you understand how your business is performing.

Akato & Associates combines Accounting, Tax, and Business Advisory services to help business owners establish a stronger financial foundation.

An adviser and a business owner going through statements at a desk

Small Business Accounting

Reliable accounting begins with accurate books.

We can assist with:

  • Bookkeeping
  • Bank and credit card reconciliations
  • General ledger accounting
  • Accounts receivable
  • Accounts payable
  • Payroll accounting
  • Financial statement preparation
  • Balance sheet review
  • Profit and loss reporting
  • Cash flow reporting
  • Accounting cleanup
  • Chart-of-accounts design

We also review financial information for unusual balances, classification issues, and other items that could affect tax reporting or management decisions.

An adviser and a business owner reviewing tax binders and forms at a desk

Business Tax Compliance

We prepare tax returns for a variety of business structures, including:

  • Sole proprietorships
  • Single-member LLCs
  • Partnerships
  • Multi-member LLCs
  • S corporations
  • C corporations

Tax compliance may include federal returns, state returns, Schedule K-1 reporting, estimated taxes, owner compensation, basis considerations, and applicable state pass-through entity requirements.

An adviser explaining business entity options on a wall screen to a client

Entity Selection & S Corporation Planning

The entity you formed with your state and the way your business is taxed are not always the same.

We help owners evaluate whether operating as a:

Sole Proprietorship | LLC | Partnership | S Corporation | C Corporation

remains appropriate as the business grows.

For businesses considering S corporation taxation, we evaluate profitability, owner compensation, payroll requirements, distributions, administrative costs, and state taxation before recommending an election.

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Reasonable Compensation

Shareholders who perform services for an S corporation generally must receive reasonable compensation.

We help business owners understand the relationship between:

W-2 Compensation → Payroll Taxes → Shareholder Distributions → Business Profit

rather than simply choosing an arbitrary salary.

A man and a woman reviewing charts and papers across a desk

Tax Planning

Tax planning may include:

  • Quarterly estimated payments
  • Owner compensation
  • Retirement contributions
  • Equipment purchases
  • Vehicle deductions
  • Section 179
  • Bonus depreciation
  • Pass-through entity tax elections
  • Timing of income and expenses
  • Shareholder or partner basis
  • State tax considerations
An adviser and a business owner in discussion at a desk covered with charts

Business Advisory

We use your accounting information to help answer practical questions:

Are sales growing?

Are margins improving?

Where is cash going?

Can the business afford another employee?

Should the owner increase compensation?

Which expenses are increasing fastest?

Is the business structure still appropriate?

What We Help You Manage

  • Bookkeeping
  • Payroll
  • Financial Statements
  • Business Taxes
  • Entity Structure
  • Cash Flow
  • Estimated Taxes
  • Business Decisions

Frequently Asked Questions

Should my LLC elect S corporation taxation?
Possibly. The potential benefit depends on profitability, reasonable compensation, payroll costs, state taxation, administrative requirements, and your overall circumstances.
What is reasonable compensation?
Reasonable compensation is the salary an S corporation shareholder-employee should receive for services performed. Factors can include responsibilities, experience, time devoted to the business, and comparable compensation.
How often should my books be reconciled?
For most active businesses, bank and credit card accounts should generally be reconciled monthly.
Can you handle both my business and individual tax returns?
Yes. Coordinating the two can be particularly helpful for owners of pass-through businesses because business income ultimately affects the owner's individual return.
Do you provide year-round tax planning?
Yes. We encourage business owners to plan before year-end rather than waiting until the tax return is prepared.
When should I change business entities?
Entity structure should be reviewed when profitability, ownership, compensation, growth plans, or tax circumstances change materially.

Services

How we work with small business owners clients

The service lines our clients in this sector call on most.

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Experience Matters in Your Industry.

Work with a CPA firm that understands the accounting, tax, and business considerations unique to your industry.

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