The Top Benefits of Hiring an Accountant for Your Small Business
If you’re a small business owner, you often have to make do with a limited budget. You may also do everything by yourself, including handling the books. It could benefit your business tremendously if you have an accounting background or extensive financial knowledge.
However, small business owners who don’t have much experience in bookkeeping or accounting run the risk of hurting their business.
Often, it’s best to hire an accountant to do your accounts since they can:
- Offer strategic financial advice
- Find astute ways to save money
- Help boost your revenues
- Remove or automate routine tasks
Below is a list of what they can do for you in the various stages of your business:
Launch Start-up process
1. Helps determine the suitable business structure
You’re ready to put your plans and start a business. The first thing to do, however, is to set up the foundations, including deciding the best business structure like:
- Sole proprietorship
2. Assist with the business plan through financial analysis
A business plan is a useful tool for convincing both investors and lenders about the feasibility of your idea. The only way to do that is to assure them your business will make money. An accountant can help:
- Test your ideas
- Identify your initial and operating costs
- Project a credible revenue forecast
- Identify the right investors or lenders for your business.
The business plan should present you’re a clear strategy for success. No doubt, you can make it work with enough funding. However, the challenge is to show your plan and strategy in terms that an investor or lender will understand. An accountant can help you:
- Highlight the parts which will get the attention of your audience.
- Set up goals, whether personal or financial.
- Suggest tools that can measure your progress. Once you present clear key performance indicators (KPI) for the business, your audience will find it easier to say yes.
3. Provides advice with regards to suitable accounting software
Today’s software can automate a lot of routine administrative and manual tasks. An accountant can provide advice on what kind of software can take care of:
- Time records and scheduling
- Point of Sale (POS)
- Making payments
Also, cloud accounting software is making it easier to integrate the various financial activities, helping you run the business smoothly and at lower costs.
For example, software like Sage50cloud can help your business keep tabs of your various business processes ranging from bookkeeping to budgeting. Aside from Sage50cloud, Northants Accounting list of accounting tools can help you select which software will fit your business.
You don’t have to buy the most expensive online tools. Sometimes, cheaper or free versions can prove just as useful if not better. Also, many of the paid software offer free but limited versions or free trials. You can take advantage of their offer and evaluate the software before buying.
4. Accountants can also help you with other things like:
- Select suitable banks to open an account with
- Comply with accounting procedures, government regulations and requirements
- Give expert advice on expense tracking
As your business starts to gather momentum, you’ll need an accountant to manage your growing accounts, including:
It’s the lifeblood of a business. If you run out of money at the wrong time, you’ll risk losing the business. Even if you have a successful business, you can’t keep it running for long if revenues aren’t coming in as fast as your expenses.
Accountants can help manage your cash and set up strategies for dealing with times of low revenues. By setting up a cash reserve and payment plan, you’ll have less stress in dealing with creditors and suppliers.
While you can handle the routine bookkeeping and administrative stuff, they can handle specific situations like:
2. Choosing between an employee or an independent contractor
A regular staff member will often entail costs like:
While hiring an independent contractor can reduce some of these expenses, there are certain advantages in having a regular employee.
To find out which is the better choice, an accountant can come up with real numbers to back up your decision.
3. Managing Debt
Often, you’ll find the need to borrow money to keep your business going. However, any money you acquire comes with interest and payment terms. You’ll need an account to determine:
- Lowest interest rate
- Best repayment schemes
They can also tell you if your excess cash is better used to pay back debts or reinvest in the business.
4. Accountants can also offer their assistance in:
- Examining your financial statements and its impact on the business
- Giving recommendations when closing your annual book, preparing your financial reports, and fulfilling tax requirements
As your business grows, an accountant can offer valuable advice and resources by:
1. Working out a budget that will support the company’s goals
If you don’t have the time and energy to make a detailed budget, you may come up with numbers based on assumptions and estimates. Fortunately, an accountant can help you produce a budget that can answer the following:
- How much is the cost of doing business?
- Is there any money left for paying debts or re-investment?
- Will make a profit?
These are just some of the queries that well-prepared budget can answer.
2. Manage your taxes
As your revenue increases, so does your taxes. You’ll need an accountant who can help:
- Lower your tax exposure of the business
- Deal with any old tax debts
- Fix any poor record-keeping
- Avoid unnecessary tax audits
- Present accurate books in case you get audited
3. They can also:
- Offer help or insight as to which areas your business can grow like inventory management or financing.
- Assist in projecting financial forecasts
Many small business owners try to assume all the roles in their business from sales to deliveries. However, it’s best to have an accountant handle your books and finances. While they will cost you in the short-run, the long-term benefits and savings you’ll get are well worth it. Aside from their know-how and skill, select an accountant you can trust. Remember, you’re also sharing your confidential information about your business. So choose someone reliable.https://www.completeconnection.ca/the-top-benefits-of-hiring-an-accountant-for-your-small-business/Business