How Can Accountants Help Small Business Owners?

By Ashutosh Jha → Last Updated on Monday, January 21, 2019
Small business owners are very conservative in terms of their income and expenses. When we say conservative, they keep track of their income vigilantly. On the other hand, they trim down their expenses up to the last dollar. There are also some circumstances in which the owners tend to forget the entity concept. They often mixed their personal expenses with the company.

Start-up businesses are also vulnerable to dissolution and insolvency because the owner shoulders all the aspects of the business. When we say aspects, this involves the operations, marketing, procurement, collections, sales, and sometimes, even in accounting.

How Can Accountants Help Small Business Owners?

Owners are hands-on when it comes to their business especially for SMEs and start-up ones. Due to this situation, the owners tend to have difficulty in managing their company. Hence, it may cause an unfavorable impact as to the income and expenses of the business.

If that's the case, how can an accountant help and contribute to the company? Here lies the role of an accountant to the overall aspects of the business:

1. Business Structure Advice

Accountants may help the owners in strategizing and analyzing the company’s structures. They are knowledgeable on how to treat business. It may fall under an individual, joint ventures, partnership, or corporation.

Determining the proper business structure is important because it has tax implications. Furthermore, accountants may also advise the businesses to prepare the required documents to be submitted to the regulatory bodies.

In addition, the accountants may also assist the company owners when it comes to costing, budgets and business plans.

2. Full Accounting Cycle and Cloud-based System

It is recommended to the owners to hire at least one private accountant and outsource another accountant who will support the former. In this way, the owners may be able to budget their cost for hiring staffs and help them with financial needs.

The accounting professionals may help you with the overall financial cycle from the bookkeeping phase, collecting receivables, paying bills, payroll system, financial report preparation. They will be responsible for responding to different suppliers, customers, employees, auditors, and tax preparers as far as the financial aspect is concerned.

Accounting professionals will also advise you to separate your personal expenses from the company's expenses. An entity concept must be established in accordance with the GAAP and standards.

When it comes to choosing the best cloud-based system, these professionals may also advise you with the most convenient accounting system that you can use for the business.

If you want to hire a financial expert, consider the TW Accounting Gold Coast Accountant. They offer services that range from accounting, auditing, tax, managerial advisory, SMSF, and more. You can ask for a quotation to check whether their offer price meets your budget.

3. Tax Preparation and Lodgment

Businesses are required to lodge tax returns and activity statements. They also need to prepare their superannuation as they contribute money to their employees' super funds. With regards to these matters, tax accountants are on high demand.

In addition, they can advise the owners with various tax implications and help them with the tax planning. Hiring an accountant with tax experience is highly recommended because they can manage your books at the same time, they will prepare the GST reconciliations, BAS, and IAS.

In this way, it will be cost effective for the company, especially for small businesses. Instead of hiring the services of a taxpayer, the accountant will act as the bookkeeper and the tax preparer.

4. Financing Structure Consultation

Usually, there are two general types of financing which include capital investment and mortgage. An accountant's role is to provide recommendations to the management on the effective use of equity and debt combinations to operate a business.

They will also advise the management whether the business has the capacity to pay long term and short-term obligations. Financial analysis is also being performed to evaluate the solvency, liquidity, cash flow, financial position, and performance of the business. Through the help of the financial analysis, they can able to determine how they will pay off their debts, invest additional capital, perform cost cutting functions, and recognize income.

5. Regulatory Compliance

As a business, you must be compliant to the tax, audit, and governmental requirements. The accountants may advise you to keep all the receipts, invoices, contracts, bank statements, and other relevant documents for audit and tax purposes. Aside from the accounting system itself, the main source documents are the best reliable evidence.

It is also the responsibility of the accountant to follow the GAAP and AASB promulgated standards for the preparation of the financial statements and disclosures. In case there are any discrepancies between the GAAP and standards, the accountant must know how to apply the interpretations made by the committee to treat a particular transaction.

Regulatory requirements must be dealt with high precautions to protect the integrity and credentials of the company.

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Ashutosh Jha

Ashutosh Jha is a professional blogger, Blog and IT Consultant. He writes about Blogging, SEO, Making Money, Internet Marketing and Web Design.
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