If you’re looking for ways in which to expand your enterprise and bring in more cash flow, you may want to consider investing in small business accounting services. Operating a startup is no simple feat, especially when you’re in charge of managing your own finances. From tracking and handling your business’s financial health to tackling more complex accounting processes, small business accounting services offer a wide range of benefits.
In this article, we’ll be outlining the multiple duties that external accounting services can perform that will grow your business.
Why Choose Small Business Accounting Services?
Managing all the processes of your business comes with a range of challenges even though it may seem like a rewarding venture. The administration of your business’s finances and accounts is extremely time-consuming and may prevent you from allocating more time to the running of your company.
Small business accounting services are especially valuable for owners of startups as they offer a cost-effective alternative to hiring permanent accountants to maintain the financial health of companies. Outsourced accountants perform a variety of tasks in the workplace that not only manage your business’s finances, but also work towards earning you more money in the long run.
If you want to know why small business accounting services could be a worthy investment for your company, here are a few key benefits:
Gaining Insight From A Professional: Accountants are trained on all there is to know about the world of finances, so you can trust that your small business will not only be in good hands, but that you’ll gain professional advice on how to manage and grow your money effectively.
Less Room For Potential Errors: Because accounting is a numbers game, you’ll be working with a collection of data that can be complicated if you’re doing it on your own. With the help of an accountant, you’ll never have to worry about crunching numbers or making errors in the management of your finances.
Tax Compliance: Ensuring compliance with tax laws is a crucial part of running any business as it can lead to potential fees if mismanaged. The work of an outsourced accountant is guaranteed to comply with tax legislation as well as industry standards.
Increases Your Flexibility: Without the guidance of a professional accountant, you may be missing out on a variety of accounting services that can help to expand your business. Accountants can assist with tasks such as reinvesting in your branding, readjusting your product or amending your service offerings.
More Time To Focus On The Business: Running your own small business requires a great deal of time, money and resources, which is why small business accounting services are so valuable. By outsourcing an accountant, you’ll be able to focus on more pressing responsibilities instead of handling time-consuming accounting tasks.
What Small Business Accounting Services Offer
Accounting services are a fundamental step in upscaling any small business. Accountants help to streamline your business’s financial tasks, which means that you’ll have more opportunities to expand your business as well as increase your profitability. Here are seven convenient services that outsourced accountants offer that can help scale up your business:
Bank Reconciliation: Accuracy is crucial when handling the finances of any business, which is why bank reconciliation is so valuable to small business owners. At SureBooks our small business accounting services offer this feature so that all your transactions are recorded, up to date and exact.
This process involves comparing your personal bank statements to those of your business as a means of tracking all transactions. Additionally, client payments, business expense reports and customer invoices are also matched up to your available funds. Outsourced accounting services are especially useful for performing these types of tasks as they ensure the accuracy of your financial data.
Tax Accounting: When it comes to running your own business, every penny counts. This is why any penalties incurred or money lost can heavily affect the success of the business. One way to avoid hefty fees is ensuring compliance with tax laws. An especially popular service that accountants offer is tax accounting. Staying on top of your tax payments and returns not only saves you money, but also keeps your business in legal compliance with the government’s tax policies.
Financial Reporting: Financial reporting refers to the tracking and management of any income documents related to the business. These documents include cash flow reports, balance sheets, income statements and financial statements. Startup owners’ ability to measure their business’ progress and make decisions depends on the accuracy and organisation of their financial reports. These reports are vital as they inform what economic decisions are made by the owner as well as evaluate cash flow predictions.
Internal Auditing: Protecting your assets and maintaining the internal controls of your business, internal auditing is a must. Internal auditing is a form of risk management that involves the analysis and examination of the business’s financial documents and records. For large enterprises, these duties are typically fulfilled by an in-house auditor.
With a small business accountant, you’ll be able to reap all the benefits of an in-house auditor without the hassle of hefty costs, lack of expertise and inflexibility. Additionally, this service is especially useful for small businesses as the management of potential risks can help to scale up enterprises.
Payroll Accounting: This accounting task is usually offered by outsourced accounting services as it can be a time-consuming task for business owners. When it comes to recording, calculating and managing the payroll of your employees, payroll accounting is vital. Payroll accounting can be a tedious process as it involves not only the calculation of employees’ compensation, but also the administration of ensuring that all employees are paid on time with tax compliance. If you’re struggling to pay your employees on schedule and record their payrolls, you may want to consider outsourcing a small business accountant.
Bookkeeping: One of the most important and sought after of accounting services is bookkeeping. Bookkeeping ensures that all financial transactions within the business are recorded and organized on a day-to-day basis. Every bit of money coming in and out of the business needs to be tracked, especially for startups trying to grow their business. A key reason as to why bookkeeping is central for accountants to perform is that it helps to measure business performance through the creation of financial reports. With outsourced accounting services, you can trust that all your financial dealings will be accounted for.
Accounts Receivable And Accounts Payable: Accounts receivable and payable refers to money that is both owed to the company as well as money the company owes to vendors. Money that the business owes tends to have specific payment deadlines so that suppliers of the business are paid on time. Managing your accounts payable is a necessary task for scaling up the business as it can improve relationships with suppliers as well as increase the business’s outbound cash flow.
Accounts receivable pertain to money that external parties owe to the business that have yet to be paid, typically by customers. Maintaining a healthy cash flow is made easier with accounts receivable and accounts payable as it helps to manage the balance between what is coming in and out of the business prior to payment.
Common Accounting Mistakes Small Businesses Make
Professional bookkeeping is the key to maintaining and growing a small business, which is why any errors made can have detrimental effects on the business. Managing finances is an unavoidable process that all businesses are required to do, which is why small business accounting services are advisable for maintaining the financial health of small enterprises. If you’re taking on the role of bookkeeper and business owner, mistakes are bound to happen. Here are a few of the most common mistakes small business owners make in accounting:
Improper Categorization: Organisational skills are beneficial for any accountant as their sole responsibility is to record, analyse and manage all financial data relating to the company. Often, small business owners that take up accounting roles tend to mix up expenses and categorise them incorrectly or duplicate this data.
Unlike most business owners, accountants are proficient in bookkeeping skills and are more than capable of keeping your financial records in check. Organising and categorising your finances efficiently is necessary for understanding the financial progress of your business, especially when you cannot afford to make mistakes.
Not Managing Petty Cash: The use of petty cash is common among small businesses and is important for covering minor costs incurred by the company. To avoid theft or fraud, businesses that use petty cash need to establish policies around the management of their petty cash. Without proper monitoring, money that is leaving the business undocumented can lead to tax issues as well as bookkeeping problems.
Petty cash needs to be recorded, managed and must follow policies stipulated by the business. This mistake is often made by business owners and can result in a lack of accountability in the company.
Incorrect Classification Of Employees: Misclassifying employees in the business may seem like an insignificant error, but failure to properly determine who is on or off staff can lead to legal penalties and fines. This is because misclassifying an employee as a contractor is considered an illegal practice. When business owners categorise employees as contractors, they are no longer obligated to comply with labour laws or pay for taxes incurred by payrolls. While some owners choose to do this as an underhanded way of saving on costs, many employers are not fully aware of existing tax laws or the consequences that come with breaking them.
Tackling All Accounting Tasks Solo: Accounting is a complex and time-consuming practice, which is why proper education and training is mandatory for any aspiring professionals. Employers with little to no accounting experience often take on the task of handling their own books, which can inevitably lead to their business’s demise. Mistakes are easy to make when bookkeeping, which is why having an additional person, especially one that is proficient in accounting, is necessary for spotting small errors.
Business owners don’t have time to manage their finances daily as they are occupied with running their own company. While it may seem like an expense at first, hiring a small business accountant is an investment that will save you money and time in the long run.
SureBooks: An Upscale Ally
In this article we investigated not only why you should consider small business accounting services, but also the host of benefits that come with SureBooks small business accountants. Whether you are proficient in financial matters or need all the help you can get, SureBooks professional team is there to help.
So don’t hesitate to contact us today and find out how we can help you grow your business.
