Accountants Help Your Business Keep Better Track of Its Finances
The key behind the growth of any business is proper financial management. This means keeping good track of what your business is spending money on, how much it is making, and what its margins are. Keeping close track of these finances sounds easier than it actually is.
Indeed, many business owners choose to go it alone when managing their books. Unfortunately, this often results in costly mistakes and inefficiencies in how the business is operated. Accountants can step in to help your business keep better track of its finances and to end up increasing profits.
Assisting with the start-up process
If your business is starting up, accountants can provide critical guidance and advice on how to set up your core business functions. They can help with any of the following start-up functions:
- Providing advice on the best business structure: if you're considering a sole proprietorship, Limited Liability Company or any other form of partnership, accountants can enable you to weigh the benefits and disadvantages of each option from a financial perspective.
- Accountants can enable you to set up a framework for keeping track of business expenses. They can advise you on the best software to use, and accounting practices that will ensure your business remains compliant with financial reporting and tax guidelines.
- Providing guidance on how to track business expenses and to identify areas where potential growth can be observed.
Advice regarding daily business operations
Beyond the start-up phase of a business, accountants can also help you manage the daily financial aspects of the business. Most businesses are fueled by how well they can keep track of what they spend and what they obtain in return. By working with an accountant in day-to-day operations, you can experience the following benefits:
- Preparing financial statements that provide insights into how the business is operating.
- Ensuring that your employees are properly compensated and categorized by the company. For example, independent contractors should not be the same as full time employees.
- Assisting in the preparation of year-end financial statements and tax reporting records: This is perhaps the most important role that accountants play in businesses of any size. The year-end financial statements normally provide an in-depth perspective on how the business is operating and are normally required by Australian law for taxation purposes.
- When you're ready to grow your business and expand your operations, accountants can help you identify growth areas of the business or operations that are not yielding worthwhile returns.