Amazing Ways Accountants Help Your Business Profitability
I went to see someone who was refered to us that needs our service. In the course of our discussion, he said ‘I don’t normally want to talk to chartered accountants, I prefer this accounting graduate of Universities and Polytechnics and Ordinary National Diploma graduates’
I asked him, ‘What result are you expecting from whoever is your accountant?’ He said, he cannot say specifically but know he should be able to take care of his account.
This shows our men do not know how an accountant can help his business profitably.
This leads me to another experience I had with a lady accountant who came for a job interview in our office. I asked her what her schedule of duty in her current place of work. She said, she collects cash from the salesmen who go out to sell, count it and give it to the managing director.
Business owners and managers need to know and understand what accountants are supposed to do. It is wrong to see them as “counter of money”. Accountants are trained to add value to businesses, especially to the profitability, that’s why this is our focus today
Accountants install and implement an accounting system
The accounting system is the basis of any accounting function in any organization.
It is the processes and procedures employed by an organization to capture and process the financial transaction data in order to achieve the objective of accuracy, relevance, and timeliness in the financial reports.
Included in this is a recommendation of appropriate accounting software, installation and setting up of the accounting software.WAYS ACCOUNTANTS HELP YOUR BUSINESS Install & implement an accounting system Maintain the books of account and preparation of financial statement Prepare financial report on monthly, quarterly and annual basis. Click To Tweet
Accountants maintain the books of account and preparation of financial statement
This is concerned with record keeping of all financial transactions and also includes filing of supporting documents.
This involves raising sales invoices/bills, receiving purchases invoice, writing vouchers, updating stock records, make payments of invoices/bills that are due, deposit money in the bank and so on.
All these must be put in the journals and general ledger which are the books of account.
Accountants prepare financial report on monthly, quarterly and annual basis
It is the responsibility of the accountants to carry out the following
- preparation of monthly financial statements and payroll,
- and in some instance, preparations of quarterly reports and
- preparation of annual financial statements with the attendant preparation for statutory audit.
The essence of monthly financial statements is to enable the organization to measure her performance and financial position so that if there is any problem it can be addressed at an earlier possible time.
Accountants help to determine “break-even point” for your business
A break-even point is a key factor in determining profitability for your business. Through this, accountants are able to help businesses determine what units of their product they need to sell that will make them recover their fixed costs.
This gave assurance that your business is sure of survival.
Break-even point is also important because it enables you to know what each unit of your product is contributing to your business profit.
Accountants help you know “Facts Behind the Figures”.
There is a lot of information behind your business numbers.
Accountants can easily decode your financial statements and exhume a lot of information hidden underneath.
This set of information will help you in decision making and guide against both loss of profit and money.
Accountants manage and monitor your business cash flow.
Cash flow is the lifeblood of any business, without cash flow, no business can survive.
It is for this reason that accountants paid close attention to cash flow management and monitoring through the preparation of cash budget and forecast and monitoring through roll-up cash budget.
Accountants Offer Cost Reduction Assistance
Accountants can help businesses become more efficient by assisting them with cost reduction. They can analyze budgets and spending habits, much like financial advisors.
They can also make suggestions on whether or not certain costs can either be reduced or eliminated.
For example, a clothing store may be spending an excessive amount of money on advertising a certain product. The bookkeeper can look through the financial statements and compare the amount of money being made from the product and the amount of money being used to market it.
They may find that this form of marketing is taking an economic toll on the company. In this case, they may suggest that the money should be used differently or that the advertising plan should be significantly adjusted
Accountants offer advice on tax-saving strategies and tax planning
Taxation is part of the training of accountants. In fact, most tax practitioners are first of all accountants before being tax practitioners.
It is in the light of this they can offer tax-saving strategies and tax planning on personal income tax, company income tax, value-added tax, withholding tax and others.
The whole point of this piece of content is to make business owners and managers know what they are losing by not employing accountants or patronize the outsource services of accounting firms.
Another reason is for the business owners and managers to know what their accountants should deliver to them and for them also to demand the same.
It is not our concern that you should go and employ an accountant immediately.
Rather, it would be helpful if you can patronize outsource accountants who can carry out your accounting functions for your business as if they were on the ground.
These are unlike an employee, which you have to pay salary and all types of allowances. And when they resign your business might suffer a lack of accounting function until you get another. But outsource accountants will always be there for you at all times.