Are you aware of the reason why most companies fail to keep up with the big establishments even though they have a great start? It is because they have poor financial Accounting management systems.
After a business reaches a particular revenue threshold, the finance department must be bestowed upon someone who has experience. This is where the accountants come in handy. They are responsible for financial accounting and much more. It has been discussed in depth below.
Identify Potential Deductions
An accountant acts as constant support who can identify the potential deductions that can be carried out throughout the year. If you are writing an assignment on accounting, you can highlight this point. The accountants will advise you on how to make strategic decisions. They consider items like depreciation, home office spaces, excess expenditures, etc. They even design a framework which prevents unnecessary expenditures.
Make Minimum Financial Errors
99.7% of businesses throughout the worldare small enterprises. But, do you know that the key to transforming these businesses lies in the hands of the accountants (to a minor extent)? This is because they are specialized in bookkeeping and analyzing financial statements. They can prevent calculation errors in asset value calculation. A skilled bookkeeper will ensure economic growth and stability.
Prevent Dreaded Audits
Many business owners have the wrong impression that accountants are only useful when there is an issue in auditing. What they don’t get is that the experienced accountants help in preventing these issues in the first place. An audit can be avoided if you get proper counseling from an accountant. They make sure that there is no error on tax forms or excessive write-offs. They keep your business fiscally sound.
Offer Real-time Advice
Experienced accountants are capable of estimating the potential consequences and implications of hiring more employees or making lavish purchases. They can monitor the cash flow and assist you in budgeting. Thus, you get a clear picture of your hurdles or deficiency in the capital, in real time. A collaborative approach will allow you to make a decision based on the business trends and the projections based on the latest data.
Ensure Statutory Compliance
Matters of law and regulations can be very intricate and tough to handle. On this front, the accountants are well aware of the state regulations, and they can take the burden off your head. A proper accounting system ensures statutory compliance when it comes to the business. You will no longer have to handle liabilities such as sales tax, VAT, income tax, pension funds and others. The accountants will keep track of it and prepare a report every month.
Save Valuable Time
Time is crucial for any business. The accountants make sure that you are not wasting your time and energy on the estimation of budget, preparing reports, and looking after legal matters. Managing finances single-handedly is not an easy assignment. You might succumb to the pressure and commit errors. Having a tactical business advisor certainly outweighs the cost you have to bear. Moreover, you can focus on running the business in the meantime.
Contribute to Future Planning
70% of the small business accountants see that their roles get modified from advisory roles to more strategic responsibilities. This is because they assess the seasonality of your business. This, in turn, helps business owners figure out the best time to buy inventory, or allocate budget for huge investments on technology, supply chain and logistics. Even if you are caught up in important tasks, your accountant makes sure that adequate steps are being taken to promote the business.
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Offer Risk Analysis
They also help a business with their risk management and internal controls. Accounting managers design, plan, implement, execute and monitor risk managing activities and programs. They ensure Quality Control Process, Business Continuity Plan and advice board members about the potential risks in the company.
As you can see, an accountant plays a pivotal role in a business apart from financial accounting. Some of the necessary skills that they should possess are:
- Computer Proficiency
They should know how to handle spreadsheets and database managementsystems. They should also be able to operate accounting software such as Tally, QuickBooks, etc.
- Analytical Prowess
He or she should be able to collect and assess large sets of financial data patterns or potential issues. Application of data analytics to accounting is one of the latest trends that each accountant needs to master.
- Communication Skills
Every accountant should have good listening and oratory skills. They should be able to gather the required facts and figures from the stakeholders, managers, clients, etc.Moreover, they should have the ability to express their ideas and present reports clearly.
- Computational Skills
Last but not least, the accountants have to be proficient in mathematics and statistics. They must be able to estimate complex problems and predict patterns and possibilities.
So, if you are looking forward to expanding your business or start a new company, it is important that you get hold of an accountant. If you find the accountant has all the skills mentioned above, you can bestow your faith in him or her. Meanwhile, you can take care of all the entrepreneurship decisions.