When it comes to bookkeeping and accounting, aerospace and defense contractors face a unique set of challenges. In order to be successful in the industry, it’s crucial to have a thorough understanding of the requirements and best practices for managing your finances and strategizing for future growth. While some aspects of A&D accounting are just the same as in any field, others require specialized knowledge and a familiarity with the industry and DCAA compliance requirements, and choosing a CPA with such a background can be hugely advantageous for your business. Here are just six ways that a CPA can help:
1. A CPA can help you maximize your growth potential
The world of A&D has changed substantially over the last several years and is expected to continue to develop and evolve in the years to come. Around the world, defense budgets are increasing and causing a rebalancing of spend, and according to experts at EY “The commercial aerospace market has attractive opportunities with a positive long-term outlook.” In order to make the most of these opportunities, though, it’s crucial that your team include someone well-versed in the financial implications of capitalizing on these industry developments, someone who can alert you to potential risks while helping you maximize profits. An experienced CPA with training in the world of A&D can provide valuable advice on how to take advantage of growth opportunities in the field and strategize for the future.
2. A CPA can help you minimize growth potential-related risks
While there are numerous opportunities for A&D contractors in both commercial and defense realms, these opportunities also carry significant risks. In a report from EY discussing the top 10 risks in A&D, contractors’ strategic initiatives, financial position, global operations, and the specifications for compliance in their different markets are all risk factors associated with this potential for growth. The report continues, “The players with the best understanding of these risks will be in a better place to win the race of sustainable profitable growth.” Hiring a CPA with considerable experience in A&D means having someone on your team who has such an understanding of these risks, thus giving your business an advantage when it comes to future profitable growth.
3. A CPA can advise your firm on the best strategy and business model
Working within the right business model is unquestionably linked with a company’s financial performance, and with current shifts in the world of A&D, being open to change and knowing which strategy to take are critically important for the success of your business. In Deloitte’s brief “The Next Era of Aerospace and Defense,” the organization argues that “rethinking the constraints that form the basis for strategy and business model decisions today will be the hallmark of those companies that are truly poised to outperform the A&D industry over the next decade.” Changing consumer demands and limited resources mean that companies need to work to maximize their leverage on fixed cost, and a CPA with the right background knowledge and experience is invaluable in this process. Contracting a CPA with experience counseling A&D players on business strategy is one of the smartest moves you can make in the changing world of A&D.
4. A CPA can help you increase efficiency
There are a lot of considerations inherent in managing in the production process for A&D contractors, but a qualified and experienced CPA can help you pinpoint areas in which your business could be more efficient and can advise on how to implement strategies to make your business as efficient as possible. A CPA can provide daily, weekly and monthly operating metrics to help you stay on top of your production targets and ensure you are meeting your goals.
5. A CPA can help you ensure you are acting in accordance with DCAA standards
Ensuring DCAA compliance can be a complicated endeavor, but having a certified and experienced CPA on your side can give you peace of mind knowing your financials are as they should be and that you will meet compliance standards. At Sousa & Weber, our team includes a former DCAA auditor, so you can be sure we know the ins and outs of DCAA compliance. Your CPA can advise you on the necessary adjustments needed to bring your business up to scratch and help implement systems to keep it that way.
6. A CPA allows you to focus on big picture
There are a lot of moving parts in the world of A&D, and worrying about the accounting books can feel like just one more piece to manage. By contracting a CPA with experience in the world of A&D, you free up your team to focus on the big picture. You can rest assured that your finances will be looked after responsibly while staying on top of the financial goings-on of your business with frequent updates from your CPA.
There’s no doubt that hiring a CPA with experience in the field of aerospace and defense contracting has numerous benefits, but it’s important to engage someone who understands the unique challenges facing A&D businesses in order to best serve them. Here at Sousa & Weber, our team has 150 years of combined experience, so you can be sure that all your accounting matters are in good hands. If you are interested in learning more about how one of our CPAs can help your A&D business reach its goals, get in touch with us today! We look forward to helping you navigate the world of A&D financials and compliance.