This is Why CPAs Can Hurt Your Financial Performance

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If you’ve ever felt like your CPA is missing the mark, you’re not alone. While many CPAs excel at keeping your business compliant, they often focus too much on the small details and overlook the bigger financial picture. The real value in driving business performance comes from understanding the key levers that impact growth, profitability, and strategy—not just handling taxes. If your CPA isn’t helping you focus on those, you could be missing out on major opportunities.

1. Compliance vs. Strategy: The Big Disconnect

One of the biggest issues I see is that many CPAs get too caught up in the weeds of compliance. They’re so focused on the transactional side of your business that they fail to look at the bigger picture. I’ve seen businesses tracking tiny expenses like break room ice across multiple divisions. Why? Because it’s part of their compliance process. But here’s the problem: while you’re tracking pennies, you might be missing out on millions in margins.

When I step into companies, the first thing I do is shift the focus from these little transactions to the real drivers of value—like pricing, cost efficiencies, and customer acquisition.

2. Financial Statements That Don’t Reflect Reality

Another major issue is that many CPAs structure financial statements for tax convenience, not to show the true economics of the business. I’ve seen businesses with direct labor expenses buried in general operating expenses instead of where they belong—cost of goods sold. What’s the result? You end up with skewed gross margins, making it nearly impossible to price correctly or understand your breakeven point.

It’s critical to restructure financial statements so they tell the true story of your business. That’s the only way you can make informed, strategic decisions that drive performance.

3. Poor Tax Advice That Costs You in the Long Run

Lastly, many CPAs focus so much on tax savings that they give bad advice, particularly when it comes to business structure. For example, I’ve seen CPAs advise companies to hold property in an S corporation, which can lead to higher taxes and increased liability. There are plenty of other pitfalls like this, where poor tax advice ends up limiting your business growth and costing you more down the line.

Why Strategy and Finance Matter More Than Compliance

I understand the CPA perspective—I’ve been there myself. But my focus is on finance and strategy, which is where you drive real business value. Compliance and tax savings have their place, but if your financial reporting doesn’t reflect the true economics of your business, you’re missing out on the bigger opportunities.

If you're ready to take your business to the next level, let’s connect. You can book a one-on-one strategy call at coltivar.com. Until next time, keep your focus on what drives real growth.