The Importance Of In-House Accounting Professionals
The Most Important Small Business Hire?
Leigh Gillatt • Recruitment Articles
Many business owners thrive on a DIY mentality: Do everything you can yourself and don't pay for anything new until you absolutely have to.
However, it's really difficult to justify this mentality when discussing the importance of employing in-house accounting professionals.
Financial integrity is paramount to any size of business. Yet, the temptation in small to medium sized businesses is great to think that, if you're the owner or office manager, you don't need to employ accounting professionals. You can handle all the accounting functions yourself. After all, isn't that what Sage is for?
The truth is, there are much more effective ways to handle this crucial aspect of your business. In fact many business owners who employ accounting professionals usually discover they weren't doing nearly as well on their own as they thought they were.
In other words, it might also be time for you to employ an accounting professional too!
How can accounting professionals help my small business?
When you employ skilled accounting professionals, you create some insurance against ineffective or even faulty financial management. For each stage of development your small business is in, the right accountant can be a lifesaver.
When a business is in the startup phase, an accountant can:
- Advise on what type of legal business structure to go for such as Sole Trader, partnership, limited liability partnership or limited company.
- Help give guidance and provide detail to the financial section of your new company's business plan.
- Help you make decisions about how to maximise profit if your personal finances are tied to the company's success.
- Help advise you on the right type of accounting software for suitable use by your business.
When a business is already established, an accountant:
- Manages day-to-day accounting transaction recording such as Purchase and Sales Ledger, and ensures it is compliant with the law.
- Oversees or may well process Payroll depending on your business' requirements.
- Manages tax preparation, including all forms for employees and contractors, payroll PAYE & NIC considerations etc.
- If your company is VAT registered, they will perform and submit specific period VAT returns to HMRC.
- Takes responsibility for tasks such as Cash Flow reporting, Budget control, and Bank & Nominal reconciliations - forecasting your cash flow is especially important. Over or underestimating incoming costs or expenditure can be fatal to the future of your business.
- Analyses financials in order to find cost savings with suppliers, employees (number of or working times), and operational costs - Savings may be minimal or significant, but the focus on improvement could make a big difference to your net profit.
- Can plan for changes in business expenses to ensure that additional costs do not cause financial hardship.
- Because of the respect they receive in the local business community, accountants can also provide important networking contacts and can even help you prepare your finances to present to new investors.
- Will constantly make sure they are up to date on the latest tax legislation so they can ensure you don’t pay any more of your hard earned money than is absolutely necessary.
During a growth period, an accountant:
- Advises on how to handle financial growth by providing financial reports and insights on the opportunities identified by the business owners.
- Helps with planning expansion, opening new locations or even selling the business.
- Perform specialist cost saving and streamlining processes resulting in savings identified more often than not covering their salaries two or more times over.
And should the day ever come that your business is in financial difficulty, your accountant can:
- Identify problem areas causing some of the financial issues.
- Write new plans to bring finances under control.
- Work with the company's creditors to set up payment plans where debt has escalated, and reduce other expenses such interest charges.
Does my small business need full-time accounting professionals?
In some cases, employing accounting professionals for short periods of time or for particular projects such as tax preparation may make more sense for businesses with a small number of employees. A recruitment agency focused on placing temporary accounting and admin professionals such as Diverse Employment can help you during especially busy periods.
Many small companies find that dedicated accountants — either full time or temporary — can find cost savings throughout the business and advise on budget planning, taxes and relevant laws and regulations.
Ultimately, most small business owners realise the wage cost for one employee is well worth the expense. An accredited (such as AAT or CIMA, PQ or Qualified) expert can manage a company's finances far more profitably than even the most passionate amateur.
The right accountant could be the best new hire your small business makes, call Diverse Employment on 01724 846906 now and see how we can help you recruit high calibre accounting professionals to fill your accounting job vacancies.