If you thought that hiring an accountant was an unnecessary expense, think again. An accountant has far more to offer a business than merely completing the year-end audit.
A qualified, experienced accountant will also have a wealth of business knowledge that you can draw on whenever it is needed. Here are just ten ways that your accountant can help you as your business grows.
1. Assist with Your Business Plan
An accountant will be able to help you draft your business plan and cast a critical eye over the business assumptions that you have made. They will be able to help prepare the financial forecasts and make sure that you have included all the relevant sections that are needed in the plan. Appointing an accountant at this early stage of the business will also help you in the future. If you have an accountant working with you from day one, you will have a long-term business advisor who understands your business.
2. Advice on Your Legal Business Structure
Your accountant will advise on which of the various business structures will be best for your business. The multiple legal formats, such as sole proprietorship, partnership, and corporation, all have different tax and personal liability implications. Your accountant will be able to explain the advantages and disadvantages of each format. Your accountant will also be on hand to help should you wish to change the legal structure of your business in the future. You may, for example, want to invite a business partner to join you in your venture.
3. Oversee Your Accounts
If you are not familiar with accounting, hiring a qualified accountant will ensure that your books are kept properly. They will be able to recommend accounting software for your business. An accountant will make sure that your accounts are set up to provide you with the management information that you will need. They will also either keep your books for you or oversee a bookkeeper employed to complete the task.
4. Ensure Tax Efficiency and Compliance
Having an accountant on board will ensure that you comply with tax regulations and pay your taxes on time. Your accountant will also help you structure your business and personal finances in the most tax-efficient way. Lots of new and small firms pay unnecessary tax penalties because they do not file taxes correctly, or they pay taxes late. Hiring an accountant will help ensure that you do not fall into these common tax traps.
5. Assist with Business Loan Applications
If you ever need to raise funds through a business loan, your accountant will help you with your applications. An accountant will prepare the relevant financial forecasts that a lender will want to see, and they will be able to advise on the type of loan to apply for and review the terms of loans for you.
6. Help You Through Any Rough Patches
If your business hits a rough patch, your accountant will help you manage your way through challenging trading conditions. An accountant can review costs and find ways that you can save money. They can help manage your accounts receivable and collections. If it becomes necessary, an accountant can also negotiate with creditors on your behalf and provide you with insolvency advice.
7. Source of General Business Advice
An experienced accountant will have worked with lots of other businesses like yours. They will be able to draw on their experience of working in different sectors, too. So, your accountant may be able to bring ideas to the table that you would not have otherwise considered. Accountants also have lots of business contacts. So, when you need a business lawyer, a bookkeeper, or you want to rent local business premises, your accountant may provide you with the contacts you need.
8. Help You Maximize Profits
Your accountant will be able to analyze your accounts for you and help you maximize your profits. They can look at your gross margins, your costs, and track the crucial financial key performance indicators. Often business owners are too close to their business to see the forest for the trees. An accountant can take a high-level view of your accounts and possibly see things that you have missed.
9. Act as Your Sounding Board
When you are running a business alone, all the decisions are down to you. Being the sole decision-maker is one of the attractions of being an entrepreneur. Still, it is always good to have someone you can use as a sounding board. Your accountant will have broad business knowledge, so they will be the ideal person with whom to bounce around business ideas.
10. Save You Time and Money
Overall, hiring an accountant at the development stage of your business will save you time and money. Your accountant will be your expert adviser as and when you need them, and getting your accounts and finances in order before you begin trading will ensure that you have a solid base from which you can grow. As your business expands, you will also be able to use more of your accountant's time when it is needed. So, you will be able to focus more time on managing your growing business.
The above points are only a few of the benefits that a qualified, experienced accountant will bring to your business. So, don't think that you only need an accountant for filing taxes and auditing your books. An accountant can also be an invaluable partner who can work with you to help you manage and grow your business.