How investing in working with an accountant can save your business a fortune
Updated: Nov 19, 2021
Accounting is a vital part of every business regardless of its size – from small businesses to multinational corporations. Ignoring your accounts, even for a short period of time, can be damaging to your business. However, accounting is complex, and mistakes can be costly. Working with a professional accountant can save you a huge amount of time and money, which are often one and the same. Let’s look at how working with an accountant can benefit your business.
Accountants vs bookkeepers
The terms ‘accounting’ and bookkeeping’ are often used interchangeably, but they are not the same thing and it’s important to understand the difference.
Bookkeeping records and organises financial data, whilst accounting focuses on analysing and explaining that data to assess your business’ performance. A bookkeeper records all of your revenue and costs, but an accountant prepares that information as a tax return or financial statement and makes recommendations for savings or improvements. Simply put, bookkeeping is entirely objective, whilst accounting is more subjective. These roles certainly overlap, but you may need to outsource or consider investing in software.
Save time, tax and mistakes
One of the biggest draws of working with a professional accountant is that they will save you a significant amount of time and energy, even if you only use them once a year for your tax returns. These are hours that you could re-invest in your business, thus saving you money too.
Accountants are also able to use their expertise to help you reduce the amount of taxes you must pay. They can even help you to create a tax-efficient financial plan for your business going forward. Furthermore, your accounts and tax returns must be 100% accurate and mistakes are not cheap. A professional accountant ensures that you won’t be hit with a hefty fine for an innocent error and provides peace of mind, allowing you to focus on what is important to you and your business.
The importance of accountants as your business grows
Accountants are useful in different ways during the various stages of your business’ life. You may not think you need accounting services before you launch, but professional help can really set you up for future success. Here’s how an accountant can help you throughout your business' journey:
An accountant can advise on the most suitable business structure for you, help to build your business plan, set out goals and assist with securing any required investments. Working with an accountant this early in your business also helps you to avoid accumulating financial errors which can be difficult to resolve later on. Additionally, their services free up your time to concentrate on other areas of your business that may require attention.
An accountant will help you put your best foot forward during the start-up phase of business. It’s well worth having a professional on hand as you’re learning the ropes. An accountant can help you to set up a suitable accounting system that will serve you going forward. And amongst other things, an accountant can help you track and measure the numbers that are important to you and your business which plays an integral part in achieving your goals.
Whilst it’s advisable to work with an accountant as soon as possible, it’s absolutely crucial when your business reaches the point of expansion. Hiring more staff means that you’ll need a payroll system and advice on employee benefits. Increased costs also mean that you’re likely to need advice on how to improve your cash flow; this is essential for the financial health of your business.
Although it may seem a long way off, you may wish to sell your business or retire from it eventually. For the former option, you’ll need an accountant to help maximise your business’ value so that you get the best possible return. An accountant can also help to plan your future finances so that you can have a prosperous retirement.
There’s no question about it – your business needs an accountant. It’s important to stay on top of your finances and remember that accurate accounting saves significant time and money for both you and your business. The benefits of working with an accountant make the investment worth every single penny.
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