Accountants do a lot more than count beans

 
Few business owners appreciate the wide and deep knowledge that accountants have of their business and of business management in general. For one thing, their training as an accountant provided theoretical background about how businesses work. Then, in practice they get to deal with clients from a large number of diverse business types and industries and learn a lot about how businesses actually run and the real problems business owners face.

Many of us undergo an annual checkup with our doctor. As a result we expect to be given a report on how healthy we are. If a problem is diagnosed and some remedy suggested chances are we take the advice and act on it. After all, he's a professional and our health is really important to us.

How many of us use the professional talents of our accountant though? We go along for the annual "checkup" to get our accounts prepared and tax return compiled. Those figures to an accountant are like an angiogram to a doctor - they give a picture that can be "read" to show how your business is performing, where there may be problems and where it could be improved. Failing to discuss your financial results in detail with your accountant is like walking out of the doctor's surgery without getting the full diagnosis of your health problem.

What do accountants really do?


Here's a brief rundown of some of the ways in which your accountant is able to offer advice and practical suggestions to improve your business.
  • Tax planning: Beyond simply preparing tax returns accountants advise on the best tax structure to minimise your obligations on a year by year basis and on estate planning to ensure your heirs receive what you want them to without the involvement of legal complications and tax incidence.

  • Business advice: Increasingly, accountants are being drawn into business advisory work by their clients who are seeking to improve the performance of their business and need specific solutions. Accountants can advise on matters ranging from setting up internal controls to protect against fraud, to strategic planning to improve competitiveness, to coordinating the sale of a business, to developing the succession plan to transition the firm to the next generation of owner / managers. Some take up positions on the advisory boards of go-ahead businesses who want a source of objective and competent advice added to their planning.

  • Management accounts preparation: Businesses should prepare management accounts at least once a quarter to ensure they are on track with their business plan. Compiled regularly and systematically the information in management reports can be analysed to reveal warning signs of developing problems in operational and financial areas. Your accountant can provide advice on how to manage around them as well.

  • Personal finance advice: Your accountant understands that for a business person their personal finances are integrally linked to their business finances and will offer advice on both fronts. For example, while serving as your small business accountant they might assist you in developing a retirement plan or an estate plan. This planning will ultimately leave you and your dependants in a stronger financial position when you eventually exit your business.

  • Information technology applications: Many accountants today are also very savvy when it comes to SME computing technology and solutions. Not just in advising which accounting package would be right for you but in such diverse areas as ecommerce and data security.
Don't make the mistake of using your accountant only at tax time. A good accountant can provide a wide range of business improvement services that include both preventive and restorative actions. If you are using your accountant solely for their tax service, then you aren't making use of them in an area where they can offer real value - small business management advice.

Contact us

Email results@businessacademy.nz

 

Skype PhilANZ

 

Phone 04 920 0911

 

P.O. Box 30-545, Lower Hutt 5040

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