No one dreams of opening a restaurant or shop so that they can spend hours staring at accounts payable and receivable columns. Many entrepreneurs and small business owners can benefit from having an extra hand balancing the books, but they may be unsure about outsourcing to an accounting firm. Experts recommend hiring a professional accountant once a business has around 25-30 employees or revenue above $1 million, but many organizations can benefit from bookkeeping help much sooner than that. Understanding some of the other services a firm provides can make the decision easier.
Setting and sticking to a budget is a challenge for any team, so having an outside look at the income and outflow of cash can be extremely helpful. An accounting firm can offer advice on when companies should hire new employees, what percentage of the budget should be allocated toward improvement or expansion, and how much money will be needed to maintain normal operations.
Monthly and quarterly taxes can be complicated. From preparing an end-of-the-year tax return to facilitating an audit, this is sure to be one of the most useful services offered by a firm. Also, the accountant may also help set up tax software systems as well as auditing software. By automating these processes, the need for a full-time bookkeeper is eliminated making the cost of consulting with a firm less expensive than keeping an employee on staff.
The advice offered by an accounting firm is especially useful for newer business owners who have never had to manage large-scale financial operations. An accountant can be a valuable resource for advice on financial strategies, how to maximize tax breaks, investment of business resources, and risk management. Accountants can also provide insight into the depreciation of equipment and other assets, which is important in a final valuation.
While a tech-savvy entrepreneur might know every programming code under the sun, he or she may have absolutely no knowledge of the tax code or other business regulations. Having an accountant available can help ensure that the business operates legally and does not incur any fines. If any of these regulations change, the business will be notified and advised on how to incorporate necessary adjustments.
5. Forensic Accounting
If a business owner suspects that one of his or her employees has been committing fraud, an accounting firm can investigate to see if there is a paper trail. This is called forensic accounting. In addition to the benefit found in having experts examine the books, this also helps to avoid any appearance of bias or impropriety.
No matter how large or small, every company can benefit from the knowledge, advice, and services offered by an accounting firm. To establish a customized service plan, a company’s owners or general management should set up a consultation with a financial advisor that has a solid reputation and a proven history of success.