Behind every successful company is an entrepreneur who’s a master of his trade. But , behind them, is usually an experienced accountant. Accounting allows a business to keep a tight grip on its finances while also reducing the costs of taxes for business and other overheads. Anyone with the ability in running a business might not possess the knowledge or desire for managing their accounts, and they definitely won’t be able to do it in a timely manner.
If your business has expanded beyond the size of a specific amount it’s a good idea to engage a professional for accounting to allow you to concentrate on the business. But a professional accountant can do much more than simply free your time. Businesses that work with qualified accountants typically gain access to a range of other services as well that can help you cut costs, lower the risk of failure, adhere to regulations as well as make plans for the future. As an owner of a business, the majority of your major decisions will be based on financial factors therefore it is only common sense to talk about them with your accountant before making them.
What exactly is an accountant’s job?
Here are a few most important ways that accountants can be the linchpin in your company:
1. Making sure you pay the correct amount of tax
You do not want to be paying more tax than you have to however, underpaying could get you in problems with HMRC. This is why you must choose to exercise prudent when it comes to the tax return for your business. An accountant is able to calculate your allowances and expenses with more certainty and therefore will be able to identify substantial savings while making sure you avoid costly errors.
2. Tax savings
An accountant is always up-to-date on tax laws, and can be aware of the various ways to legally lower the tax burden. They can help you identify legitimate tax-efficient strategies like using incentives offered by the government allowances, allowances, or expenses compensating losses, or altering the method you receive revenue out of your enterprise.
3. Improved cash flow
The management of cash flow is an essential aspect of business, but it is often ignored by new businesses. Businesses can get into problems quickly if it does not have cash on hand to spend, regardless of the amount of profit it can earn on paper. An experienced cheap accountant will make sure the cash flows are robust enough to protect you from dangers, and increase confidence with your stakeholders and investors.
Sometimes, you as a director could require additional money from your business. This can be done through director’s loans. However it is important to handle them with care. professional accounting is especially crucial.
4. The process of setting up your business
A lot of business ventures fail due to the numbers and forecasts aren’t rigorously evaluated. When you write an outline of your plan for business, a professional accountant will assist in putting solid foundations. They can provide an expert third-party opinion free of emotional bias. They should also be able provide helpful suggestions in crucial areas, such as your business’s model. A business plan approved with your accounting professional is in place and is likely to be attractive to investors, too.
A professional accountant can also help you on the most appropriate legally-sound structure to run your company such as sole trader or limited company, or some other type of structure. Each has its own economic implications, and some may better suit your needs than others.
5. Reducing your workload
If your company really starts taking off, you’ll have to dedicate all of your energy to run daily operations, not being occupied with finances. In the same way, as your business’ finances get more complicated it is likely that you will require an expert to handle the management of these.
6. Financial and bookkeeping reporting
Bookkeeping is an essential element of managing your business’s finances. Financial reports to HMRC is an obligation under the law. An experienced accountant will be able to provide both of these services as part of a full service package.
7. Regulation
In general, larger companies are more subject to regulations from the government. The compliance with these regulations could take a significant amount of time, making mistakes that are simple and damaging. An accountant can take the responsibility off your shoulders.
8. Growth financing
At some point , all companies will require additional capital for growth. The ability to secure financing from banks or any other source is a crucial bridge to cross. Both Investors and lenders want to have confidence that they’ll receive a return on their investment. Your accountant is essential in presenting a convincing financial argument to the appropriate people.
9. Management of growth
Unexpected growth you’ve never planned for could be as troublesome as slow growth, which can lead to various issues related with cash flows, taxes employees, office space or even employees such as. A growth surge that is not managed could even cause you to fall back. An experienced accountant will help you respond quickly and efficiently to unplanned growth, and transform it into what it ought to be: a benefit.
10. Audits
Companies that exceed a certain size are required to undergo a statutory audit, in which case an accountant is essential. However, for smaller companies, an internal audit that is voluntary can be a fantastic method to ensure that your goals for business on track. The kind of audit you get from this type of audit assures the business that things are going over without a hitch as well as an excellent method of preparing you for a mandatory audit.
11. Business buying or selling
Acquisitions, mergers or acquisitions (M&A) could be the fastest way to grow your company or gain entry into an entirely new market. If you’re contemplating buying a competitor’s or a similar business An accountant is the first point of contact. They’ll analyze the feasibility and look over the company’s financials to make sure everything is in order.
12. Business advice
Most people do not realize that accountants also function as business advisors. They have a wealth of expertise gained through dealing with customers from different kinds of industries An experienced accountant has seen many of the challenges and issues you could face. Therefore accountants can provide an impartial sounding board for your ideas, alert you about potential dangers and point you in the direction of opportunities.
Be aware that every business is different and accountants with different backgrounds are going to have their particular expertise and unique strengths. When you are looking for an accountant, you should discuss your requirements and goals of your business in order to make sure you select the right one for your needs.