We’ve said it before and we’ll say it again, we know the thought of accounting isn’t sexy. We also know as a small business owner it’s never going to be top of your priorities. But choosing the right accounting partner can help take your small business to the next level in 2017.
Accounting as an investment rather than a cost
Historically accounting has been seen by small businesses as a cost rather than a service providing any significant benefit to them, and traditionally they would have been right. But times have changed. A role that used to crunch numbers or sort out tax returns has become much more than that. Getting the right accountant is actually an important investment decision for your business.
When starting out with Chilli, like any other small business we had limited finances. This meant difficult decisions had to be made about allocation of time and money. Most new businesses will put off the idea of finding an accountant until the year end accounts are due. But the reality is, the earlier you engage with an accounting partner, the better it is for your business.
To prove our point, here are 8 reasons why!
- Accountants can advise on the set up of business application tools to ensure that they interact with each other efficiently e.g. get on Receipt Bank. Scan your receipts to save on administration and paperwork. The transactions are then created in Xero which will save you hours in reconciling, or hundreds in bookkeeping costs. We’ve previously talked about another useful tool for claiming travel costs in our vehicle expenses blog.
- Choosing the right system tool can help you stay on top of your invoicing. This can benefit your cash flow and potentially the profitability of your business. One good example of a tool that does this is Chaser
- Accounting partners can help choose the most efficient tax set up. For example, is it beneficial for your business to register early for VAT? If so, which VAT scheme is most appropriate? Ultimately getting this decision right can help save you money.
- Tax returns and other compliance work are taken care of. Meaning that you’re less likely to file anything late and receive fines. It also helps prevent scrambling around for money to pay HMRC at the last minute as you hadn’t realised it was due! (Ok so we’re getting into the unsexy side of accounting again, but it is a necessary evil)
- Budgeting and cash flow management. Planning your finances and setting yourself financial goals are crucial to growing businesses. If you want to be able to invest in more stock or buy new equipment, it goes without saying that you must have a handle on your finances. The new and improved accountant of 2017 can help you with this.
- Up to date accounts help you make important decisions about your business. There are some awesome applications available these days which allow you to track and measure important Key Performance Indicators (KPI’s). For example, depending on your type of business you might want to measure where your leads are coming from, what are your best-selling products / highest margin products, what jobs are taking up the most of your time. This is the kind of insight that was only previously available to larger businesses that would employ an entire finance department for the privilege. Now small business owners can join the party also!
- Another aspect of a growing business is the need for more capital. If the traditional banking option isn’t available to you, more progressive banks and crowd-funding offer an alternative option of finance. Regardless of the source, they will expect to see up to date accounts as part of their decision in lending you money. A set of accounts from 9 months ago, will not be what they are looking for. Have a look at our previous blog on getting small businesses access to funding.
- Finally, and most importantly, getting all the above aspects under control helps you relax so you can spend your valuable free time enjoying the things that actually matter in life.
Getting the most out of your investment
If you are just expecting your accountant to reconcile your accounts and fix an old problem, you won’t be getting value for money. But by choosing the right accounting partner for your business, you could be making a great investment that is guaranteed to produce returns and help you grow.
If you’d like to know more, please leave a comment below or get in touch with us at Chilli.