20 Reasons Small Businesses Need Accountants
If you are starting a small business with a small budget, you may have probably tried finding out where you can cut down costs and do more on your own in order to make do with the little funds you have.
Accounting is likely one of the areas most small-scale business owners consider handling themselves rather than hiring. This is okay if you have a good understanding of finance and posses some formal educational background in accounting. But what if you have none of these and all you want to do is run your business. Do you still need to hire an accountant? Yes, here are reasons why your business, no matter how small, requires an accountant.
- Determine the best form of business to be registered (eg. sole proprietorship, partnership, company)
- Help with your financial projections of your business plan, and other aspects of the plan
- Advise on the need for an accounting software and the type you need
- Advise on bank accounts options and which is best for your business
- Streamline accounting procedures with government regulations and other reporting standards
- Explain why your business and personal finances should be kept separate from each other
- Ensure your consultants are not classified as employees
- Prepare periodic financial statements for you and explain the statements to you so you understand your business well
- Handle company payroll and payment processes
- Advise you on tax liability and payments for the year
- Compile and submit your taxes, financial reports and other filings to the Tax Authority
- Help you determine areas for growth by providing insight on cash flow patterns, inventory management, pricing and business financing
- Help you with working capital management
- Provide advice on property and equipment acquisition or leasing
- Liase with external auditors
- Undertake financial forecasts so you can make prudent business decisions
- Work with you to create a budget that supports your business goals
- Develop and implement budgetary controls
- Provide advice and resources to assist you with raising capital for expansion
- Help you prepare your business for sale when you want to
These are essential functions to the stability and growth of your business and in some cases their survival. Obviously these are not tasks for the business owner who is not trained or skilled in the discipline. You may very likely get it wrong. My advice is, it’s always better to get a professional or someone who can help than to live to regret it when your business goes down.