As a small business owner, you’re always searching for ways to cut costs. Instead of hiring an accountant, you may decide to manage your company’s books. There’s nothing wrong with that if you have a background in accounting and business finance. However, if you lack the skill, then better let a professional do the work. Mismanaging the books could cause financial and legal problems for your business.
When do I need an accountant?
Even if you have excellent accounting or bookkeeping skills, your company may still need the services of a professional.
- Is it worth your time?
- Can you do a job as good as an accounting professional?
If you’re still starting the business, you may have time to handle the books. However, as the company expands, you’ll soon find out that your time is a precious resource. Instead of spending your time doing bookkeeping chores, consider using that time to making sales. There is also the matter of taxes. You need to update yourself with the current tax regulations to avoid potential penalties.
In every business cycle, there’s always a need for an accountant. Here are several instances where you’ll need a professional to handle your books.
When starting a business, an accountant can provide service in helping you:
- Choose the business structure suitable for you, like sole proprietorship or corporation
- Analyse and write down the financial part of your business plan
- Open bank accounts for your business
- Ensure that all company financial transaction and procedures conform with current government regulations
- Track down all expenses and keeping the business ones separate from your personal
Accountants can also help you choose the accounting software that your business may need. For a list of accounting software currently being used today, consider visiting NorthantsAccounting.co.uk.
Even if your business is running, you’ll still need an accountant’s help, especially in situations where you need to:
- Explain your company’s financial statement to creditors ort investors
- Manage the payroll and payment procedures
- Estimate your tax dues and how to reduce them, legally
- Close the company’s book and provide financial reports at the end of the business year
- Compile and submit taxes returns and other financial statements to government regulatory agencies
As your business grows, accountants are indispensable if you need to:
- Identifying areas for growth using cash flow patterns or financing
- Choose between property and equipment acquisition or lease
- Comply with all legal requirements to prevent possible audits from regulatory agencies
- Prepare your company for tax examination if necessary
- Create a financial forecast that will guide your business decisions
- Come up with a budget that will support your company goals and vision
- Find out the fair market value of your company
Aside from this list, there are still various ways accountants can help small business owners. You can hire them to handle all your financial activities or enlist their services in a limited capacity. For example, to reduce company expense, consider hiring an accountant during the start-up stages and handling of annual reporting. However, for your company’s daily operations, a bookkeeper can handle your books.
Accountants are vital components in both small and big businesses. As a small business owner, you are critical in avoiding unnecessary expenses. However, it also pays to recognise when you need an accountant to handle your business finances. Keeping costs down is essential, but you should also consider the financial stability of your company.