Friday, December 8, 2023
Latest:
Money

19 reasons why accounting is essential to business survival

Dominic Lill ,  ,  ,  ,  , 

Have you been operating your small business without the help of an accounting professional? While you may be able to keep track of company finances and balance the budgets, accountants can do a lot more for your business. Accountants are trained financial professionals who can help businesses manage their accounts, make purchasing decisions, and set goals towards building in the future.

That’s not all accountants can help out with. Check out this long list below:

Best to work with a pro

Many new business owners make the mistake of assuming they can handle all financial aspects of a business on their own. The truth is, however, if you don’t have enough experience in accounting, you could be missing out on some very big opportunities to save money or increase profits. Someone who has taken accounting courses and earned a degree is educated and trained to look out for red flags or opportunities to help you grow.

Accountants are great for startups

When establishing a business, it is a good idea to start by consulting an accountant. There are several tasks you’ll need to complete and systems you’ll need to have set up to ensure your business goes off without a hitch. For smaller businesses, however, it may not be practical or affordable to hire a full-time CFO. In this case, a fractional CFO may be the right solution, providing a cost-effective alternative to having a full-time CFO on staff.

  1. Choosing the best business structure to register as (sole proprietorship, limited liability corporation, or a partnership).
  2. Creating a business plan and financial analysis.
  3. Assist you with the selection of accounting software and setting it up.
  4. Provide advice on funding opportunities to raise capital for your business.
  5. Ensure that you’re in compliance with state and federal regulations.
  6. Provide advice on how to track expenses.
  7. Help you in filing your estimated business taxes.  JDA Tax & Accountancy Services are a good option.

Accountants are great for day-to-day operations

After you’ve cut through all the red tape and actually launched your business, you’ll still need to keep a reliable accountant nearby. They can help you with the day-to-day operations as they pertain to the finances of your company. Here’s a look at some of the ways they can assist once your business is established.

  1. Assist you with hiring either employees or independent contractors.
  2. Help you review your financial statements and ensure that they match your records.
  3. Monitor and/or administer payroll on a regular basis.
  4. Ensure that you’re in compliance with your tax forms such as W2’s and 1099’s.
  5. Create end-of-the-year reports.
  6. Complete your taxes at the end of each year and gather necessary information.
  7. Aid you in deciphering financial lingo and terms on important documents.

Accountants are great for expansions

Whenever you’re ready to take your business to the next level, you need to review your finances to determine which moves are the best to make. An accountant becomes an integral part of this as they give you advice and guide you as you expand. Here are some ways an accountant can help with growth:

  1. Help you by looking for cash flow sources.
  2. Review patterns, manage inventory, and look for financing opportunities.
  3. Assist you with selecting the best property and office equipment.
  4. Create a financial forecast so that you can make more informed decisions.
  5. Help you set up a new budget that will include expenses from the expansion.

These are just a few of the ways in which an accountant can help a small business owner. While you don’t have to hire an accountant to work 24/7, having a financial professional you can reach out to for advice or outsource on an as-needed basis is ideal. When it comes to company finances, you don’t want to take the risk of doing it all on your own. An accountant can help you realize things about your company and its potential that you wouldn’t have otherwise ever imagined. So if you don’t currently have an accountant, the reasons above should certainly motivate you to search for one today.