Throughout the COVID-19 pandemic, CPAs have played a pivotal role in prioritizing and executing financial transactions so small businesses could stay afloat and avoid getting caught off guard by their finances. They provided guidance on liquidity options like the Paycheck Protection Program and assistance for small businesses struggling with bookkeeping, managed accounts payable and receivable, and eliminated nonessential expenses.
While CPAs have provided crucial financial counsel to clients navigating economic uncertainty, it does not mean they themselves are out of the woods. The harsh reality is that most small businesses — even accounting firms — fail within five years because they don’t have the capital or cash flow to keep the doors open.
When cash is tight, accounting firms can be forced to make some difficult decisions between important business priorities. That can mean having to choose between paying rent and paying employees, paying vendors or keeping the lights on.
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