It goes without saying that every business needs a great accountant. Not having an accountant would be like having a birthday party with no birthday cake – you could live without it, technically, but given the choice, you’d much rather have one.
But what exactly does an accountant do? In this article, we highlight just some of the most common things you can ask an accountant to do for your business.
Looking after the financial health of your business
When it comes to matters of money and your business finances, this is where an accountant can truly shine and where the main bulk of their time will usually be spent. This area of the role encompasses a whole array of tasks and responsibilities, some of which we outline below.
Managing cash flow
As a business owner, you don’t need us to tell you that money comes and goes; some months will be more lucrative than others. An accountant will help you navigate these ups and downs to keep your cash flow stable by monitoring spending and income patterns to help you plan ahead.
Ensuring wise spending
An accountant will also help you stick to a spending strategy that ensures you’re never left short. They’ll point you in the right direction of the wisest places to invest spare cash and warn you when it’s time to tighten the purse strings.
As part of ensuring you spend more strategically, an accountant can also help you identify areas where you could be saving money. This might be in fixed costs such as utilities but also through allowable expenses and tax relief, which we cover in more detail further down.
Help with managing late payments
Overdue invoices and late payments are an ongoing battle for business owners and can develop into a serious cash management problem if left unchecked. An accountant can help you put systems in place to help you deal with this, such as using bookkeeping software with automated payment reminders.
Accurate and rigorous budgeting
With a full, 360-view of your finances, an accountant can help put a budgeting structure in place that supports the desired growth of your business. Managing budgets is a time-consuming task, so having an expert on hand to answer questions is an invaluable resource for busy business owners.
Helpful reports and forecasts
Accountants are proficient at producing financial reports such as profit and loss statements and cash flow forecasts, just to name a couple. They’ll also be able to complete and submit your annual returns more efficiently and accurately, saving you time and reducing the risk of human error.
Ensuring ongoing tax efficiency and compliance
Improving and maintaining your tax efficiency and compliance is another key role that an accountant will step into to support your business. They will do this in a number of ways, including:
- Making sure your returns are submitted accurately and on time to avoid HMRC penalties.
- Setting up automated reminders so that you have plenty of notice to gather information.
- Explaining what your allowable expenses are and helping you to claim what you can.
- Identifying where you could be taking advantage of tax relief and refunds.
- Helping you avoid a dreaded audit.
- Sharpening your bookkeeping habits.
- Getting you set up with accounting and/or bookkeeping software.
- Resolving errors and discrepancies.
- Reconciling your accounts.
Supporting and revising your business plan
Perhaps one of the most overlooked but valuable ways in which an accountant can support you is by applying their expertise and knowledge to your business plan. They can help you set goals, identify performance indicators, produce forecasts, and construct a narrative around your business that will be appealing to lenders and investors looking at your plan. It’s also a good way to help you stay on track!
Support with loan applications and funding
Not only can an accountant point you in the right direction of the best loan and funding opportunities open to you, but they can also help stand you in better stead when it comes to application and presentation.
They know what lenders and investors are looking for when it comes to forecasts and figures so can make sure your pitch covers all bases. They’ll will also help get your business in great shape before approaching loan and funding bodies.
Simplifying and streamlining your accounting processes
Hiring an accountant for your business will help make your financial records more accurate and save you money, but it will also significantly boost your efficiency.
Handing your accounts over to a qualified professional will save you hours and hours’ worth of time each month by streamlining and simplifying processes, so you can concentrate on more pressing matters, like growing your empire.
Not sure where to start? Read our guide to choosing the right accountant for your business.
