When you own a small business in Croydon or elsewhere, money matters never end. You have your accounts payable, accounts receivable, sales figures, annual statements, payroll, projections, cash flow, and taxes. The hours can really add up, especially on the taxes.
Sometimes, when a business is just starting out, those tasks fall squarely on the owner’s shoulders of financial necessity. It can be tempting to maintain that arrangement once the money starts to flow, not only to avoid paying someone else to do it but also to avoid allowing someone else to do it. Few entrepreneurs love giving up control. But if there’s one place to assign a task to a dedicated expert, probably that is a Croydon accountant.
Accounting Errors Can Cost You
When you’re trying to handle every aspect of the business yourself, details can get overlooked, especially as your business grows and your finances get more complex. Chances are, unless you own an accounting business, your business’s financial picture will stretch the limits of your expertise fairly quickly. Accounting errors, especially tax-related accounting errors, can get expensive.
You could probably argue taxes alone justify the cost of handing over your finances. That cost may end up being less than the cost of doing the work yourself. Remember, you’re paying yourself for all those hours you spend recording, sorting, calculating, inputting, researching the latest changes in tax law, etc. Even if the accountant’s hourly rate is higher than yours, it takes the accountant significantly less time to complete the work accurately.
The Benefits of Sound Accounting
Accounting isn’t just about taxes. It’s also record-keeping, analyzing, financial planning and forecasting, and complying with state and federal regulations.
To reap all the possible benefits of good accounting practices, you need to set up a strong accounting system, keep it thoroughly up to date with all relevant data and effectively use that data to understand the financial state of your company as the business grows. For some of these, you don’t necessarily need an accountant.
A good bookkeeper can handle a lot of it, including the daily tasks of updating records and customer payments, inputting invoices and employee hours, and tracking transactions in the accounting system charging less than accountants.
Accountants Don’t Have To Be On Staff
If you’re not ready to add the salary and benefits to your payroll, you can always outsource the accounting work. When you outsource your accounting work to an on-demand professional, you pay for the expert time you need, which might just be a few hours a week.
As your company grows, so will the complexity of the financial recording, analysis, compliance, and reporting required to keep it on track and in good standing, at which point accounting tasks will take a lot longer than a few hours a week.At that point, it likely makes more financial sense to get an accountant on your staff. It could prove highly beneficial across the board. Until a full-time Croydon accountant makes sense, think about at least hiring an accountant for the big stuff. It ends up costing so much more in both time and money when you get it wrong.