The journey from an idea to a formal business and from there to being an established corporation is based on crucial decisions. These decisions decide the success or failure of your venture. And, one of the most important considerations is when to bring in small business accountants to handle a crucial aspect of your operations – financial management.
Unfortunately, many startup owners wait for their business to surge before considering the recruitment of small business accountants. As you may have guessed by now, the result is similar to that of waiting to run until you hear the roar of a lion. It’s too late in most cases. Many fresh entrepreneurs feel that they do not need an accountant and can handle everything by themselves. If you’re a startup owner reading this, and if you think on similar lines, then think again. You are not a mythical character from movies who performs multiple tasks with a flick of their wand.
Hence, it is imperative for you to realize early on the need for small business accountants. If you’re worried about the cost, then compare it with the headaches and losses resulting from end minute tax and accounting errors. Successful entrepreneurs know the significance of having an accountant to help them with their business finances. If you want to pave the way for success, you need accurate financial data and a healthy financial management system. A business accountant can help you with it. Here are some reasons why you need to hire an accountant for your startup:
When you start out, you are the whole and sole person employed by your business. You are responsible for running the show. This means that you are the executive, the secretary, the marketing executive, the customer service representative, and also the accountant. Now, imagine yourself handling all of these business functions for a year or more. Think about a scenario, where you are doing the math for the month end and at the same time working toward securing a business opportunity. If you trust us, it is maddening. Plus, the ‘I can do it all’ attitude is a major reason behind the early failure of startups. Successful entrepreneurs accept the fact that they cannot do all things at once and take the help of accountants. Accounting for income and expenses and updating financial records is crucial to the success of your startup. And, only a professional accountant can help you do that smoothly.
If you ask any small business owner what concerns them the most, you will get a list of things with taxes being on the top of that list. Calculating and estimating taxes can be tricky. Plus, they are not only limited to income tax. Payroll, sales, and other taxes may need to be estimated depending on the size and the nature of your business. Many startup owners fail to pay their taxes on time or make costly errors that lead to unfortunate expenses and losses. Plus, if your accounting and bookkeeping system is not up to the mark, then this makes calculating taxes all the more complicated. And, you certainly do not want the CRA knocking on your office door for any reason. It’s best to take help of experts for taxes. This way you do not have to deal with the hassles of taxation and your tax filings are also taken care of in time.
You must have raised the initial capital, but you may need to raise funds from time to time to fuel the growth of your business. If you think your passionate idea will suffice to please the investors, then you need to reevaluate. Even though you are good with pitching an idea, it is not enough to convince investors to fund your business. These professionals want to see figures, growth projections, and a lot of convincing financial data. A lack of accountant increases your chances of error-ridden financial reports. And with these, you are unable to make projections and fail to secure funds. Even if you are still years away from approaching investors, having an accountant will keep you on top of your money matters and helps you create reasonable financial projections. Having an accountant also ensures investors that your company is financially sound.
No business owner likes to see postponed growth plans. But, how do you estimate the right time to expand? And, how do you know that the finances you are investing in won’t put your business at risk? Many startup owners go with their business acumen for such decisions. Yes, strong business acumen is a vital aspect of successful ventures. But, relying on it alone may not be always suitable. And, if something goes wrong, then you risk all the effort you put in to turn your idea into a working model. Money is an important consideration while thinking of expansion. When you have someone to look over your finances for you, you minimize the risk of failure and unfortunate obstacles. A good accountant helps pinpoint when the business picks up and when is the right time to consider expanding it. Since you have a strong financial plan, you are able to make logical decisions and drive smooth growth.
Rarely will you find a startup owner who has a perfect work-life balance. Since most entrepreneurs take every business function on their plate, they end up with less time for their personal lives. This is especially true when their business starts grabbing opportunities. They start working for hours at end in their desire to achieve success faster. While they are working toward success, most of their time usually goes in tedious tasks like accounting. As a result, not only their personal lives get ruined, they also don’t achieve the results they aim for and end up with a burnout. Multitasking is not the right solution, especially when you are aiming for big things in life. Success can be achieved by sharing responsibilities. Accountants can take on the task you are less than thrilled about and allow you to focus on important matters. You also don’t have to compromise on your personal life. Hence, it is a win-win situation for you to consult an accountant.
As a startup owner, you have the option of hiring an individual accountant or outsourcing your accounts to professional small business accountants. Although hiring an individual may seem suitable in order to managing expenses, it may not be as beneficial as outsourcing your accounts to small business accountants. Read on to find out why:
In addition to the above-mentioned benefits, outsourcing your accounting to small business accountants provides you with these advantages:
Startups usually don’t want to spend a large amount of money on salaries. And if you pay a less amount, you won’t get experienced candidates. There are high chances that you will receive applications from new or young accounting graduates. While there is nothing wrong in giving newcomers a chance to show their talent, you need someone with a good amount of experience to handle the hoard of responsibilities in a startup. Even if you hire someone with a little experience, you can’t guarantee that they will never make errors. By outsourcing your accounts to a professional firm, you get a range of experts on board at a reasonable cost. You do not have to worry about a high pay, training costs, bad hires, and errors when you outsource your accounts.
Professional accounting firms not only manage your accounts and taxes but also provide you with feedback on your financial status. Since they are well-versed in every aspect of financial management, they help you track performance and also provide you with accurate financial projections. This allows you to make strategic decisions logically. In addition to this, you can also avail the mentoring services offered by these companies. The aim of professional accounting firms is to provide quality services to their clients to help them drive their business to success. Their mentoring and accounting services align with this goal. Hence, with small business accountants working for you, you do not have to worry about errors and focus on other significant tasks and take the path to success.
If you have difficulty handling your business accounts, then consult specialized small business accountants at Altitude Accounting today.
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