It is indeed a crucial milestone for any business to hire an accountant. Some entrepreneurs keep their own books and don’t think that the services of an accountant are necessary, but they can help to walk your business through the cash flow in a more advantageous manner. Understanding when to make this decision can be extremely beneficial in managing resources, especially in addressing issues related to taxation as well compliance. Below is a brief explanation of telling signs that would make it appropriate to consider bringing an accountant on board in your firm.
1. When Your Business is Just Starting Out
There are several financial and legal issues that a person starting a business has to contend with. An accountant can prove useful from the onset by assisting with the following:
What type of business structure to go with, i.e. sole proprietorship, partnership, LLC or corporation.
The first step in their start up is whether to use use a computerized accounting system or to set processes in place manually without utilizing any software.
Estimating and making predictions of the budget at the beginning in order to avoid being caught off guard by expenses.
Also, accountants can help new resellers understand the types of write offs and credits their businesses can claim, which can be beneficial in funding operations in the early stages of their business.
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Most individuals, especially Businessmen, retreat into their shells and at times over-stress whenever the period of taxation draws closer, especially on hands-on employees who do bookkeeping work for the company all year round. A certified accountant comes with a wealth of experience with tax codes hence will be able to:
Assist in the timely and precise preparation of returns.
Ensure that no applicable deductions and credits for the business are left of claimed.
Provide advice about tax with respect to the present situation and future structure of the business.
For small businesses and self-employed individuals, the scope of amelioration in terms of taxes that the work of an accountant helps translates and the amount of blunders that such a situation negates is averagely quite high.
3. When Business Growth is Experienced
With the growth of a business, the financial activities become more involved, hence the need for an accountant to assist with:
Well managing cash flows due to the increasing levels of income and expenditure.
Planning funds whether for growth, employment or new stock.
Installation of new information systems or software that will accommodate increased data and improved management reports.
Changing circumstances could also mean new considerations such as operating in many states or doing business in foreign countries, thus making it impossible to run the business without an accountant to manage these intricacies.
4. If a Business is Audited
An audit is often perceived as intimidating and for good reason. It may be from the IRS or any other body. There’s , however, hope in having an accountant by your side when such a time comes. They will:
Draft the required records and assure their placement as per the provisions of the law.
Take the role of the intermediary and talk to the auditors on your behalf.
Suggest alternative ways of running the finances to cut back on further audits.
The engagement of an auditor at this juncture will ensure that any such opportunities will not overly inconvenience the day to day operations of your business.
5. When Seeking for Financial Assistance in the Course of Your Business
When eventually, a business is at the stage of seeking funding for the very first or second time, either to raise money from a bank or raise investors money, then it becomes crucial that all the financial records in the business are honest. Effective accounting helps:
Fight for the financial accuracy of the reporting documents trends and budgets and also in management for balance sheets, income statements internal controls and cash flows.
Come up with a pitch book in a structured way with figures and projections showing the viability and potential profitability of the business to investors or lenders.
Come up with a cogent business’s growth strategy that includes financial aspirations about any deployment of funds.
Financial documents are expected to be reassuring and precise, which an accountant would facilitate enhancing the chances of the financial assistance you.
6. Managing Your Payroll and Employee Benefits
As your business grows and it starts to hire more people the aspects of payroll, benefits and tax compliance has to be dealt with. A manageable help can be – An accountant can help:
Establish and run payroll services, which will ensure timely and proper payment of all employees.
Help using the right payrol paymen tax rates, deductions and contributions.
Render services in tax planning for employers providing certain attractive benefits to employees, with regard to retirement plans, health savings accounts et al.
Accountant keeps payroll in check to ensure that it meets the requirements of the labor laws and taxation laws so that one will not incur any fines as well as facilitating peaceful running of status.
7. At That Point You Consider to Stop Doing Business
Forming a business or merging with another can be a complex undertaking that has many financial, tax and legal ramifications. Accountants facilitate:
Valuation of your business properly to enhance sale or merger value.
Advising on which portions of the sale can be structured in a way that will reduce the tax consequences.
Revising & correcting every Financial Due diligence along with necessary contract clauses.
Therefore, the presence of an accountant is essential within this period as there are several impediments that may compromise one’s financial objectives.
Conclusion:
When is the Most Appropriate Time to Engage the Services of an Accountant?
A good accountant is, more often than not, one of the best assets that a business can acquire at virtually any point in its growth, be it when the business is being started, day to day operations are being run, growth is being envisioned or a sale is being envisaged. A competent accountant helps with the technicalities, saves on energy and time thus enabling growing the business in other ways.
If you happen to be a business owner and you are experiencing any of the issues noted above it is perhaps time for you to hire an accountant. Tax-Pert Accountants is ready to offer you the most suitable response y specific to your business. Reach out to us to get a free consultation and allow us to assist you in establishing a solid business financial base.