Are you running your business without an accountant? If yes, then your business is going through problems that are hindering its growth that only an accountant can solve. Here is why your small business needs an accountant:
- Handling Audits
During an audit, an accountant can help in guiding you through the whole process. Owning an accounting system that conforms to accounting standards and having an accountant who is well-versed with your books will prepare you for a visit from the IRS. Complying with tax rules that keep changing can be problematic, particularly at the state level. An accountant who ensures your business complies with rules and regulations can save you costly penalties and fines together with labor costs.
- Staying Informed
Tax rules, local regulations, and federal and state laws that are connected to your daily operations keep changing. Knowing the tax and financial impacts of all these adjustments are part of accounting. An excellent accountant can save you from searching and reading updated information. If you consult with an accountant, you will save time that you can use to operate your business.
- Managing Growth
In the business world, immense growth that comes about quickly can end a business. Planning will give you a clear image of the impacts of any adjustments you may make, such as expanding to new locations or adding to your product line. This kind of planning, using data offered by accountants, is the only way of managing growth successfully and preventing disaster. Even if you are a business person who takes significant risks and makes quick decisions, having an accountant can be a great asset.
- Payroll Processing
Payroll is one field small business owners can benefit from an accountant’s experience. Accountants frequently see the same errors when it comes to correctly processing the payroll, like assuming overtime pay is unnecessary. A great accountant will know what to check and will offer you advice on your particular situation. Some of the expertise you can need from an accountant include knowing the application of an exemption and ensuring proper classification of each employee.
- Managing Cash Flow
Cash flow is essential to any business. Every business has someone who is in control of the cash flow, and a misstep in timing has led to the downfall of many businesses. An accountant has the knowledge of analyzing the appropriate reports with regards to cash flow and determining what needs to be worked on. Some of the things that affect cash flow include amount of tax liability, adjustment in paying habit of a customer, and change in vendor payment terms. An accountant will aid you in minimizing potential problems and make plans for maximum profitability.
- Year-end Reporting
The end of the year is not just the holiday season but also the time to close your books. Small mistakes in business books can lead to a significant impact on your bottom line. Hiring an accountant can help you avoid this mistakes and give you input on steps to take to improve financial performance. Such steps may include things to do to reduce tax liability. This period also calls for checking the annual financial reports and your business health, and this can be done well by an accountant.
- Meeting Deadlines
Depending on your industry and the structure of your business, every month has its deadlines to meet when it comes to IRS. Every reporting deadline has penalties and fines for late filing. An accountant will help you to file in advance and beat all the local, state, and federal deadlines. A great accountant can also guide you on finding the best resources to automate hectic tasks such as an accounting document management software.
For businesses that want to grow and have a future, an accountant is essential in the daily operations of the business. Failure to have an accountant can result in high costs with regards to penalties and fines, poor management of cash flow, growth that is not managed, and more.