Often, talking about yourself is the most difficult thing to do, even though it seems like it should come easily. The same can be said for when you’re asked to explain your business – especially in a professional capacity.
We’re all supposed to master our elevator pitch, but if you need to go into more detail, you might wonder where to start. Particularly if you’re looking for a new accountant, and need to understand how (and if!) they can help you.
It’s really up to your accountant to ask questions that get them to the information that they need, but it will help both parties if you think about:
- What your business does – what your product or service is
- If your business is an online operation, or if you have a physical ‘shopfront’
- Who is involved – who are the people behind the business?
- Outgoings versus income – your current turnover, costs, overheads, liabilities, debts, etc.
- Your goals, plans and ambitions for the future of the business – both long-term and short-term.
The most important thing to remember is that pretty much everything matters when you’re running the show, though! Anything additional context about your business will help an accountant understand it’s past, present and pipeline. The more information they have access to, the more useful they can be.
Explaining what the business does
The best thing to do is to go back to basics, and start at the very beginning. Don’t take all your pre-existing knowledge and background for granted. Instead, give your accountant ‘the idiot’s guide’ to what your business is and what it offers.
You might be operating in a particular way, and explaining why this is the case can help your accountant suggest improvements, or at least understand where you’re coming from. There might even be tax advantages to what you’re doing! Even small changes which improve your monthly cash-flow can help a business progress.
Whether you’re a designer, a contractor, an architect, or selling products online or in a physical shop – explain the nature of what you do. They’ll also be in a better position to research your industry and stay on top of what’s happening within the sector.
Being privy to this means they can put their skills into action to aid the business’s development, your decision-making, and of course, tax efficiency, as well as avoiding common cash flow issues.
How the business operates
If your business is already registered, do you operate as a limited company, or as a sole trader? Are you a partner in a partnership? The legal structure of your company has a big impact on how and when you pay tax.
As well as sharing what you do, it’s essential to explain how you do it. Even just saying whether you’re an online business, offline – or maybe even both – can be critical for an accountant. It can inform everything from tax relief and spending efficiency to VAT accounting and beyond.
Are you a freelance copywriter who works from the comfort of your own home office? Or a small bricks-and-mortar shop on the local high street? This information can have a dramatic effect on the support which is available to you, or what expenses you might be able to claim against tax.
If your operational structure is something you plan to change further down the line, it’s definitely better to make your accountant aware of this as soon as possible.
Who is involved in the business?
Sticking with the theme of business structure, it’s also crucial to detail who is involved in the business. Not just so your accountant can get to know your business and its workforce better, but also (you guessed it) so they can make sure you’re as efficient as possible.
For instance, if turnover is very high, it might be useful to change your business structure to a limited company, even if you’re the only person in the business. This is so that you can be more tax efficient.
How your business is structured does impact your rights and responsibilities though, so it’s important to ensure this is set up in your best interests.
What your current financial situation looks like
It goes without saying that an accountant is going to want (and need) to know the ins and outs of your financial situation. These are the fundamental tools they need access to in order to safeguard and grow your business.
As we said earlier, every piece of information is important, particularly anything relating to cash flow and forecasts. Prepare yourself with full details around things like current turnover, accounts, tax history, overheads, liabilities, and debts.
What are your plans for the future of the business?
In order to help you move in the right direction, let your accountant know what it is that you hope to achieve. They’ll be able to tailor the advice they give, so you can make better short and long-term decisions.
A big part of this is sharing your business plan with your new accountant. This document is a great resource for them, and an accountant can help you re-evaluate it, and make improvements as your business evolves. It will certainly help if you need to pitch potential investors or apply for funding.
Just remember, when you work with an experienced accountant, the onus won’t all be on you. They’ll be well-versed in giving business owners the prompts they need in order to gather the information from you. But it never hurts to be well prepared!
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