Business Accountant Melbourne
When to use a Business Accountant Melbourne?
The services provided by accountants extend far beyond doing tax returns and payrolls. In fact, there are a variety of ways in which accountants can assist your business in its growth, development, and overall success. Many business owners and operators may be unaware of these services, or how hiring an accountant could be the key to success for their business.
Concerns for growing small businesses
There are many situations throughout the business life-cycle where hiring an accountant can ease the burden on management and operations. They can assist with writing an effective business plan, applying for a loan, or managing a government audit, for example.
Though this is the case, you don’t necessarily need to maintain a retainer or full time relationship with an accountant. In many cases, a few hours of their time may be enough to get your books back on track.
A key concern for any diligent small business owner is saving money, so it stands to reason that you may not think you can afford to hire an accountant. It is best to instead look at things on the basis of time; how long would it take you to manage your taxes? Could that time be better spent in other areas of your operation?
Imagine, for example, that it takes you 10 hours to do the taxes for your business, and your time is valued at $100 an hour. The total cost of doing the taxes yourself would be $1000, and there’s always the risk of mistakes being made – especially if you are multitasking, as most business owners are.
Getting a qualified accountant to take care of complex or time-consuming tasks such as taxes can often cost less per-hour than your time is worth. As the business owner your time would be free to generate revenue, and you could do so with peace of mind knowing that an expert is taking care of your business.
So, are there any other moments during the life cycle of a typical small business where an accountant’s service might come in handy?
Writing a business plan
Accountants are able to use complex accounting software to add reports and financial projections to your business plan. Strategic assistance and information such as this can ensure your business plan is professional, realistic, and likely to succeed.
It is also beneficial to familiarise yourself with an accountant’s services at this early stage so you are aware of them later on. Financial advice and knowledge such as that offered by accountants is invaluable as a business moves to take its first steps towards success.
Determining your company’s legal structure
Legal structure is not uniform across businesses. There are several different types of legal structure, all of which are determined by certain factors and have various important implications. For example, some companies are called limited companies; others are corporations, sole traders, and proprietors. Legal structures such as these vary from country to country.
Each type should be considered carefully while you determine which one best suits you and your business. For example, if you choose to operate as a sole proprietor or sole trader you may be able to offset some of your living expenses against tax by invoicing in your own name. On the same note, this could render you personally liable for any business-related obligations. Failed to pay a supplier? Defaulted on a debt? Lost a lawsuit? If you are a sole trader/proprietor, your business’s creditors may be able to legally come after your personal assets to reclaim any debts.
In the limited liability company structure, this is different. As the name implies, your business’s liability would be limited to assets legally owned by the business, not your personal assets (though exceptions may occur in some situations).
A business accountant is able to explain these details to you, and can assist you in choosing the legal structure which best suits your business and personal interests.
Helping with the finances
Small business accounting can become complex, fast, if you decide to do it on your own. You may lose track of where money is going, who owes who what and how much – an accountant will be able to assist you in getting back on track.
Business accountants routinely perform measurements of key business metrics, such as the ratio of wages and other staff costs to total revenue. An accountant can further your understanding of these costs and comparisons by visualising them for you, and assisting you in understanding how these costs may change over time.
Some business accountants use cloud-based software, ensuring that they are able to share your accounting information with you quickly and efficiently. The charts, graphs, and tables which accountants expertly produce can save you time and money by allowing you to understand your business’s financial situation at a glance.
Having access to such resources ensures that you always have a finger on the pulse of your business, and areas of concern or potential don’t go unnoticed.