Finance is an essential part of any business. As a business owner, you need to understand money management, taxes, payroll, reports and business planning. You also need to manage the rest of your company and find time to sleep. You may need to hand your finances to an accountant if you lack experience and financial knowledge.
Many business owners struggle to delegate and release some responsibility to another person. However, it’s important to get your business finances right the first time around. An accountant can help you stay on top of financial deadlines and keep your books straight. You can’t do everything – we all need a little help from time to time.
Do you really need an accountant?
If you think you can handle your finances, you should ask yourself a few questions. Are you comfortable with technology? Do you know what an accountant does? Do you understand tax and how to file a return?
Smaller businesses can do their own accounting. You could use accountancy software to handle your finances and help you stay on top of things. If you aren’t tech-savvy, you will struggle to use the software, and it could start eating up your time.
An accountant doesn’t just input the numbers into a spreadsheet. They take a hard look at your finances and help you grow your business. They can help you with financial reports, payroll, tax efficiency and business planning.
An accountant can make sure you file your tax return on time and accurately. Finance can take up a lot of time if you don’t know what you’re doing. An accountant can speed up the process, and you can relax knowing everything is taken care of. If you think your accountant hasn’t done their job correctly, you could be eligible for a professional negligence claim.
What are the benefits of an accountant?
An accountant can improve your cash flow and keep your business running. They can help you identify when it’s time to tighten your belt and watch your cash flow. A good accountant will make sure you have good credit control and advise you on cash management strategies.
Further, they can reduce your workload and give you more time to manage the business instead of the books. You can even consult your accountant about business growth and assess whether you are ready to grow the business.
Moreover, your tax liability will increase when your income keeps increasing. The tax amount you estimated might not be enough if the business suddenly faces a significant surge. But having an account in the business can help you avoid underpayments at tax.
Especially as a startup or small business owner, it’s important to understand the upcoming expenditure to grow the company. The accountant can help you seek funding and make the best financial decisions.
When does a business need an account?
In some cases, it’s good to have an accountant on board as they have the area of expertise and knowledge that you may not have. Here are some areas where you need to hire an accountant to deal with certain business tasks:
- To discuss the company’s legal structure. An account can describe the legal business structure, whether it’s an LLC, LLP or sole proprietory company. So, you can select the best one for you.
- To deal with the government paperwork. A good accountant takes care of the business’s legal documents, prepares annual statements, keeps you updated about the latest tax rules, maintains records of the business personnel, handles the company’s payroll, etc.
- To analyze the company’s financial status.
- To help reduce the business expenses.
Choose the best accounting type for the business
You have different options to hire an accountant for the business. They all have advantages and disadvantages and therefore, you need to choose wisely depending on the business needs and tasks.
- Outsourced Accountant: It’s a third-party service that gives full accounting support to a small business and you need to pay them only when they work. Thus, it eliminates the hiring cost and ensures security.
- In-house Hiring Accountant: It’s an accounting service performed by the employees within a business and you need to pay them as a regular employee. They’re responsible for IT support, payroll processing, bookkeeping etc.
- Accounting Software: It’s a cost-effective option but works 24/7 and doesn’t need human interaction. You can always stay updated, access accounting anytime, generate accurate financial reports, reduce fraud etc.
So, do your research and get an accountant based on your business requirements.