One common misconception in the business world is that “Do-It-Yourself” (DIY) is always the cheaper option. However, that is not always the case, especially for accounting. There is a reason why accountancy in itself is a profession. Accounting is a process that requires careful planning, organization, and analysis. It is not only crunching numbers, but dealing with laws, rules, and theory as well.
Going DIY for your accounts may seem like the most budget-friendly thing to do, but when you factor in the costs and penalties of the BIR finding errors and requiring audits, you’ll find yourself wishing you had a professional do it all along.
Hiring an accountant to make your financial statements and file taxes does not only save you time and the brainpower needed to analyze dozens of accounts, but it also saves you money! Though it may seem counter intuitive, the cost to pay a CPA is worth every centavo. They do the filing, running full-service, conducting an analysis, and doing other things up to the standards of the BIR.
Read on below to see how accountants are the hidden heroes of every business and how availing of their services can save your butt during tax season and all year long.
1. Offer financial advice and forecasting
If your business is a startup that’s opening soon, an accountant can help you create the financial portion of your business plan. They will give your needed advice in order to effectively open, operate, and run your business that is cost-effective and in compliance with business laws. An accountant may also provide you with financial forecasts to determine whether your plan is feasible and profitable. (Note, you can also do this if you are an older business thinking of launching new goods or services to assess profitability). Accountants may also advise you on whether to buy or lease property and equipment, deal with bank loans, price products and services, and make other important business decisions.
2. Keep track of financial statements to prevent lapses and losses
The accounting process is the backbone of every business. You cannot earn a profit from what you can’t account for. Hiring an accountant early on allows you to keep a proper and detailed record of all your transactions and accounts. Doing so yourself may result in lapses and discrepancies, most especially in cash flows. This can cause you to overlook the losses of your business and errors in the management of operations and funds.
3. Advise you on keeping a healthy cash flow
One vital thing a CPA can do for you is to help you improve your cash flow. This can be in the form of advising you on how to generate more revenue through investments in new products, services, or equipment. Accountants may also offer to help you with your payroll system and make assessments on employee benefits in order to generate financial reports to guide your decisions.
4. Get proper tax cuts that lower your final obligation
Accounting is a profession that requires a practitioner to know all business laws, tax laws, and other city regulations. As such, accountants know what donations, expenses, and purchases can be written off for tax-cuts, such as donations to charity and even team-building vacations. Your accountant will not only help you file your tax the right and rule-complying way, but they will also help ensure that you do not pay more tax than what is required from you. They will ensure that you maximize your benefits and minimize your taxes. Moreover, having your tax filing professionally done lessens the chance of errors in your statements and makes life easier for you when an audit is requested. Should you be called for BIR tax audit or mapping, your accountant will represent you.
Final Wrap Up
Going through the accounting process yourself may seem like an easy task at first, but it is a carefully planned out and meticulous process that requires the application of accounting laws and theory. Though it may seem like a big investment to get an accountant, it is worth it! From saved time to few to no accounting errors and, best of all, the avoidance of penalties and maximization of benefits while minimizing taxes, an accountant truly is the hidden hero behind every business, saving accounts, and kicking deadlines.
Most of all, when you no longer have to worry about crunching numbers, you can focus other more important areas that need your attention. Relying on the pros leave you with more time to produce new products, attend to clients, and even relax with your family. If you need help, don’t hesitate to give us call. We offer free 30-minute consultations.