Every new business should consider many things, including a business logo, website, and products. With so many things to juggle while starting a business, at times entrepreneurs forget or delay a few other key aspects of their business.
Business owners often forget or even neglect accounting and bookkeeping. They tend to manage it themselves, to save on cost. Unless they have a strong background in accounting, setting up the books for your business can be confusing and complicated.
If you are starting a business and on a limited budget, you might not want to hire an accountant. However, if you lack experience on managing the finances of a business, mismanaged books can really hurt your business.
As you launch your business, an accountant can help you:
Determine your business structure for your situation
Assist financial analysis in your business plan
Advise you on the type of accounting software you may need
Assist you on opening a business bank account
Guide you in complying with government regulations and requirements
Help you track expenses during your daily business activities
Explain the importance of keeping personal and business expenses separate
As you run the business, you will need to maintain your accounting system as well to keep your business going and maintain the health of your business. Your accountant can assist you by:
Assist with your cash flow to ensure you do not run out of money
Explaining your financial statements so you can understand the ins and outs of your business, to help you grow and become more profitable
Close-out your books and create financial reports at the end of the year.
Oversee company payroll and payment processes.
Provide advice on estimated tax payments you should make during the year.
Determine when, and to whom, you should send W2 and 1099 forms.
Compile and submit your taxes, financial reports, and all necessary paperwork to the IRS.
And when you are ready to grow your business, your accountant can be an integral resource that provides advice and helps you manage the process. Your accountant can:
Help you determine areas for growth by providing insight on cash flow patterns, inventory management, pricing, and business financing.
Provide advice on property and equipment leasing and purchase.
Help you prevent getting audited by the IRS.
Prepare you for and guide you through an audit, if necessary.
Create financial forecasts so you can make better decisions in your business.
Work with you to create a business budget that will support your business goals.
Is an Accountant Worth It for a Small Business?
You may think that hiring an accountant from the beginning is too expensive, but as you start and grow your business, you can see just how beneficial they are. From organizing your business at the get-go to growing it for the future, an accountant helps you not only stay compliant but stay profitable as well.
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