Many small business owners are unaware that more than 80% of startups fail within the first 18 months. Poor financial management is usually one of the leading causes.
Despite these grave consequences, many business owners manage their finances on their own. According to a recent study, 53% of small business owners do not use an accountant at all. Even more shocking, 27% of these respondents keep track of their finances with pen and paper.
While we shouldn’t conclude that these businesses are worse off because they don’t have an accountant, we can’t overlook the breadth of knowledge and experience that an accountant can provide.
The role of accountants is not only tax preparation but also in other financial roles in your firm. They can conduct a thorough analysis of your finances and develop a year-long forecast to keep your company healthy and prosperous.
Allowing an outsider into the inner workings of your business can be intimidating, especially if you’ve previously struggled with financial management. However, working with accountants assist you in achieving your objectives and positioning yourself for long-term success. With that in mind, here are few reasons why you should hire an accountant for your company.
- Compile all of your deductions.
A good number of business owners are literally thinking how they can increase their deductions during this busy tax season. However, it will be too late to make a difference by the end of the year.
Hiring an accountant can enable you by quickly capturing these deductions throughout the year and giving you advice on how to make better decisions for year-end deductions. Depreciation, out-of-pocket costs, and home office space are factors many business owners neglect to manage and account for. Don’t let money slip through your fingers!
- Avoid being audited.
Avoiding the dreaded audit is another strong reason to engage an accountant. Unfortunately, most individuals view an accountant as someone who can help them after they’ve already happened.
The main thing to recall is that an audit may be easily avoided if you regularly seek an accountant’s advice and assistance, specifically if you venture into risky businesses like mobile casinos.
There are various reasons why a company is audited, ranging from too many errors on tax forms to being too “charitable” to taking too many write-offs. Consider an accountant to be a long-term partner involved in and concerned about your company’s financial health.
- Conserve both time and energy
Most business owners believe that since they have a limited budget, they will not hire an accountant. However, when you consider how much time and effort you spend attempting to manage your money by yourself (not to mention the potential for errors when reporting and losses due to poor financial decisions), the advantages exceed the costs.
Food of Thought
As an entrepreneur, you should concentrate on running your company. Investing in a competent accountant and using him or her as a tactical business adviser on an ongoing basis can help you maintain that focus while keeping you on track to achieve your business objectives.