Starting on day one, an accountant can help your business grow. From company formation to loan application, they will help you every step of the way.
If you are just starting out, chances are you are looking to save every penny, so you may think it’s better to do your accounting by yourself and hire an accountant at a later stage.
But, consider how long it will take you to do your taxes, payroll, invoicing, and other tasks. Is that good use of your time?
Let’s say your time is worth $100 an hour and it takes you 10 hours to do your taxes. Doing taxes by yourself will cost you $1000.
And, if you don’t have much experience with crunching numbers, the mistakes you are likely to make can cost you even more. If you are still not convinced, here are a few concrete reasons why it’s important to have an accountant from day one.
What Can an Early-Stage Accountant Do for You?
To support you through the early-stages of your business, your accountant can help you with:
- System implementations
- Financial planning
- Incorporation filings
- Expense tracking
- Business licenses
- Policies and procedures
Up and running:
- Fixed assets tracking
- Contracts administration
- Financial reports
- GAAP financial statements
- W2 and 1099s
- Revenue accounting
- Tax preparation
- Month-end accounting
- Accounts payable/accounts receivable
Growing your business:
- Audit support and preparation
- Budget creation
- Cash flow analysis
- Financial forecasting
Your Accountant Will Help You Write a Business Plan
Not only can your accountant use their previous experience to help you write your business plan, but they can also add financial projections and other reports to it. They will help you create a plan that’s professional as well as realistic. And, most importantly, they will help you put together a plan that is more likely to succeed.
Your Accountant Will Help You Decide on a Legal Structure
There are different types of legal forms—not every business operates under the same one. Some are sole traders or proprietors, and some might be called corporations, limited liability partnerships, or limited companies.
You can choose a legal structure without the help of an accountant. But, you will need to research the differences between the most common business structures, as well as the pros and cons of each one. Again, is this worth your time? Considering that you’ll only need to do this once, it’s best to leave this to your accountant.
A seasoned accountant is good at so much more than tallying up numbers. To find the best legal form for your business, your accountant will talk to you about the nature of your work and your goals.
Let’s say you want to be a “solopreneur,” work on a self-employed basis, and invoice under your own name. Then, your accountant may suggest registering as a sole proprietor or a sole trader. In this case, some of your living expenses will be tax deductible. However, if your business loses a lawsuit or fails to pay a supplier, you could be held personally liable.
So, if this is not something you are willing to risk, your accountant can help you set up a limited liability company. To help you choose the best structure for you, your accountant will plainly explain the available options.
Your Accountant Will Help You With Your Finances
If you do your accounting on your own, it can quickly become complex. If you are having a hard time keeping track of who owes you money, an accountant like SCK accountancy can help you set up an efficient invoicing system.
They will also measure the ratio of salaries to total revenue and other key business metrics. So you can see how they change over time, your accountant will manage your payroll and produce graphs.
They’ll share your accounts with you quickly and easily. Nowadays, this is made possible by cloud-based accounting software.
To help you understand your current financial situation, your accountant will produce relevant charts and tables. This will help you keep track of cash flow and monitor the pulse of your business.
Your Accountant Will Help Reduce Your Tax Liability
If this is your first start up, you probably don’t know what’s the most tax-efficient way of running a company. A good accountant will help you make the most out of tax deductions. They know what strategic steps you can take throughout the year to be able to save money when tax season comes.
Aside from helping you maximize tax benefits, your accountant will always stay on top of the paperwork and help you avoid hefty fines and penalties. You won’t have to worry about tax deadlines and keeping up with the latest legislation.
If you don’t have an accountant to make sure everything is in order, your chances of getting audited will increase significantly. Audits are stressful, time-consuming and expensive. To prevent them, it’s best to find an accountant who offers audit insurance.
The right accountant will make life much easier for you. By letting your accountant take care of all the financial details, you will be able to better concentrate on your specialty—running your business.