Many people see accountants as boring and dull creatures. You can’t blame the name-calling. Every single day, they see accountants as paid dinosaurs who deal with numbers, calculators, file folders, tax returns, their favorite coffee mug, obsolete cellphone, and an out-of-style pair of eyeglasses.
But despite being tagged as colorless, monochromatic, uninteresting, ho-hum, and loveless pets, the truth is, your accountant is the gutsiest and the most fearless friend you can ever have outside of their 2-square meter fortress.
Here are five unignorable reasons to love your accountants and why they are crucial to the success of your business.
1. Accountants make you understand the language of your business
Accountants help business translate raw numbers into something that babies will understand.
Since accountants follow the same generally-accepted accounting principles, the language of your business’ accounting books and records should be easy to understand to anyone in or outside the company.
Accountants are your business language interpreters.
2. Accountants show you where the money is coming from and where it is going
Businesses depend on accounting to follow the flow of money. Whenever your business makes a sale, this is recorded by your accountant. If the sale is on a credit, the accountant takes note when the actual payment of your client has been made. If your client takes a lot of time to pay, the accountant also shows that. Other accounting staff monitors the payroll, investments, loans, and company purchases.
If you have just started your business, take note of these two basic but very useful reports in business accounting: the income statement and the cash flow report.
The Income Statement lets you show your revenue and expenses, while the cash-flow report follows the actual money coming into your business.
If your business runs on uncollected sales, it is very important to know both reports because a business that has substantial sales on credit can still have a shortage of cash.
3. Accountants show you the true picture of your business’ profitability and performance
As a business owner, you can use accounting to analyze how well your company is performing.
If your customers are consistently paying you late, or the business has several disputable accounts, your accountant can spot the problems.
Accountants also have the ability to compare the numbers of your business to the financials of your competitors.
Your accountant can also monitor and compare different details of your business. For example, even if your sales is up but your operational costs are growing bigger, your accountant can tap your shoulder and tell you, “Master, your money is going down the drain.”
Remember, people inside and outside of your business will always depend on the financial information that your accountant provides. If you intend to borrow money from the bank so you can infuse capital to your business, they surely would want to see if you can pay them back on time. And your accountant’s financial report is where they will first take a closer look at.
4. They help you make wise financial decisions
If you are a business owner or a manager of a company, your accountant’s financial reports are your allies in making informed financial decisions.
Your accountant’s financial reports make you answer questions such as your business’ ability to pay debts, which debts should be prioritized, how efficient the business is, which branches or products are not efficient, the expected cash flow in the coming year, the ability to expand, among others.
Whatever answers come up from those questions can definitely help you as an entrepreneur make the right decisions for your business.
5. They keep you out of legal and regulatory trouble
Your accountant can help your business avoid non-romantic dates with the Bureau of Internal Revenue (BIR), Department of Trade and Industry (DTI), the Securities and Exchange Commission (SEC), or your local government agencies.
Filing the annual tax return can be extremely tiring and complicated. Through the help of an accountant, the business can be steered to the right direction and away from the trouble with the Bureau of Internal Revenue. You can depend on your accountant to keep your records accurate and tax filings on time.
If your accounting is inaccurate, filing at the BIR can lead your business into some legal trouble and can cost you thousands, if not millions. And you don’t want that to happen to you and your business.
For the record, I am an accountant. But I don’t wear eyeglasses and I am not loveless.
To get help in your business accounting and for filing of your income tax returns before April 2018, get in touch with G&C Financials by sending an email to email@example.com or call 0977 807 3224 today.
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