An accountant is a trained and qualified person in bookkeeping. He prepares, audits and analyzes your accounts. He prepares annual reports on your finance and provides statements of planning. He also guides you in investments and advises you on tax laws.
Some small business thinks that the accountant job is just to fill the form which is not the case. An accountant is much more than that. An accountant can benefit you in several ways. He can help you to grow your business very efficiently.
We will discuss some of the benefits of hiring an accountant for your business.
An accountant is a person who is involved in keeping a record of financial accounts. He is responsible for keeping those records up to date so that they could be used for further processing.
He is the guy who is qualified in bookkeeping, auditing and analyzing financial statements he not only makes financial statements but is also associated with maintenance of these accounts. If you have a well-qualified and experienced accountant than it will be considered an edge for your business.
Definition of an Accountant
There are different definitions of an accountant
The person whose duty is to make financial statements and upgrade them from time to time is known as an accountant.
Another definition suggests
“A qualified individual whose maintains the books of accounts of any company is known as the accountant.”
"A person associated with keeping records, maintaining accounts and performing audit and financial statement analysis of a company is known as an accountant."
History of Accountant
In 1887 the first association for accountants was formed named as American Association Of Public Accountants. After that, it becomes a profession, and different shareholder lead business professional started hiring accountants for having more information about financial statements.
For being an accountant whose work is just to record data and maintain books of accounts you just need a simple degree in business but different companies have different standards some require an MBA.
Some are also good with a BBA degree. But to do an audit, you need to get some certifications like CA (Chartered Accountancy) ACCA (Association of chartered certified accountants) ICMA (Institute of Cost and Management Accountants), etc.
CA( Chartered Accountant )
Research says that CA were first accountants to form a professional body established in 1854 in Scotland. They are qualified in all stages of business like audit and, taxation, business and finance.
For being a Chartered Accountant, you need to pass individual modules and three years article ship from any reputed organization is compulsory.
ACCA (Association of chartered certified accountants)
It was founded in 1904. People with an ACCA certificate are eligible for working in different areas of finance. ACCA consists of 14 papers 1st two papers are online examination after passing 14 paper they are also required to do article ship for a certain period.
CIMA( Chartered Institute of Management Accountants)
It is a professional association for accountants. It is based in the UK it has 227000 members and of became the member of IFAC(International Federation Of Accountants) on 7th October 1977.
Rules For Accountants
Accountants are required to abide by specific rules to keep books of accounts there are some standards which accountants have to follow while preparing books of accounts.
Job Description for accountants
Different companies have different job duties for accountants, and mainly they include
- Passing entries related to assets, liability and capital accounts.
- Analyzing account information
- Updating accounts
- Maintaining transaction details
- Making Bank Payments
- Preparing Bank Reconciliations
- Dealing with interbank fund transfer Payments(IBFT)
- Preparing Financial Statements.
- Maintaining asset registers
- Reviewing and Auditing of Financial Statements.
- Analysis of all kinds of financial statements and presenting the accurate and fair view of an organization’s financial position.
- Payroll processing.
- Estimating and projecting budget lines for new projects.
- Deduction of taxes on transactions as per the laws of the state.
- Presenting reports to management about the financial situation of the company.
- Maintaining excellent details and recovering the receivables.
- Prepare, review and recommend the accounting policy manuals according to the requirements.
- Ensuring all the transactions to be in strict compliance with International Financial Reporting
- Standards (IFRS).
Saves your Time:
Hiring an accountant for your firm will help you in saving a lot of time. You can utilize that time in tackling some other issues.
If a business is filling their forms by themselves, then questions arise that are they filling them correctly?
Are they giving it proper time to fill?
Are they delivering it on time?
If not then you are not working under the time deadline, and you might get penalized for this. For example, submitting the forms and company accounts to HMRC.
If somehow you can complete it in time that possibility is quite high that there are mistakes in filling that form and it will be sent back to, to fill it again. It will consume a lot of time.
Saves your Money:
Let’s assume that you can fill your form in time and with no errors and you are confident enough to fill it by yourself. But are you filling the form efficiently? By efficiently we mean that is it saves you any money? Probably no.
An accountant is a trained person who can save you money by filling up the form efficiently. He will try to minimize your tax by using every legal constraint.
Ever wonder why rich people are paying fewer taxes than the people working at offices. Regardless of the moral wrongs and rights, they are smart enough to hire an accountant to manage their taxes.
They use the ever-changing tax laws to minimize their tax as low as possible. Saving little taxes throughout the year will make it a handsome amount in the long run.
Time and money are the commodities that are very crucial for any business. And saving them has justified the worth of the accountant, but that is not it. An accountant can help in many other ways.
Helps your business to grow:
If you have started a new business and considered it a waste of money to hire an accountant, then think again. Minimizing your work and tax and accountant can be a game changer for your business.
These are some critical decisions that new business have to take which can make or break them in the future.
The accountant knows the business as good as you know and he might know the financial sides better than you. So, hiring a person who is not emotionally attached to your business but provides its input to make it grow is priceless.
It’s worth to hire an accountant for the sake of growth of your business. He knows what is legally correct and beneficial for the business and how he can utilize these legal ways to enhance the business.
But be wise while choosing an accountant. Choose a specialist accountant who knows his work and it's better if he specializes in contractor market.