- Published: Saturday, 18 February 2017 10:43
It can be a bit confusing for an average person to know what exactly accountants do. There are known financial tasks that the professionals do for a business but these many not be apparent for persons without a degree. Most individuals consider accounting to be a boring profession.
However, the fact is that accounting is a more vibrant career than what many people think. For any successful business, accountants play a key role. Like it is the case with good managers and top level managements, they ensure the smooth running of any organization. To be precise, it is the role of the accounting department to keep the finances of a company in order.
This involves maintaining the financial records, managing salaries and conducting audits to prevent embezzlement of funds. Careful accounting ensures that bills are paid in time, cash received is recorded and the profits of a company are shared with stockholders. In simple terms, accounting involves keeping financial records. Most people engage in accounting without knowledge. The most common form of accounting involves balancing a checkbook.
Any incoming money id added to the bank account while outgoing monies such as bill payments are deducted. After balancing your checkbook, you do not only keep what is earned and spent but you also become aware of the money remaining in your account. This helps you to decide on your future investment decisions. However, accounting for a company involves more than recording cash flows. It measures whether a company is making a profit, the cost of running the company and the value of the company at any given time.
This information can be used by the management of the company to know whether the company is making the right financial choices. Financial records such as the company balance sheet can help outside entities such as the government, potential investors, financial institutions and others to see how the company is doing. On top of reporting on the basic performance of a company, many accountants also offer specialized services. They work exclusively on taxes by offering their services as certified public accountants (CPAs).
They can also work within government agencies to investigate issues such as fraud, embezzlement and financial mismanagement. The professionals can help individuals or companies trace mismanaged or lost funds. As long as people are dealing in currency, there will always be a need for accountants. They record, report and track financial transactions and therefore, literally ensure bills are paid. This makes it possible for businesses of all sizes to make smart financial decisions.Write comment (0 Comments)
During your selection process, when you find a good accountant they’re often worth sticking with. You get to know them and they understand your business so each year you can both build on existing knowledge and relationship rather than having to start again.
But if you need to first find such an accountant, whether you’ve never had to instruct one before or it’s time for a change to who you usually use for whatever reason, then it’s important to make sure you make an informed decision about who this is rather than just the easiest option. We’ve therefore come up with 8 basic ‘checks’ to go through in your selection process to help decide who will be the best accountant for you:
An obvious one I know, but it’s the total cost you need to consider after all the little extras and unknowns. So check out if there are any additional costs or expenses due, and if they charge VAT which will be an extra 20% cost for you unless you’re VAT registered to recover this back.
You may also need to check the timing of their invoices whether all at once at the end or in phases, and how quickly they will need paying. You could even look at some form of ‘bonus’ or the final payment being dependent upon their performance, although be careful this does not come across as too picky.
Make sure you know how they are regulated, and then check it out with the regulatory body. Even if a firm of accountants are regulated by such and such a body, then still check whether the individual accountant dealing with your matter within the firm is suitably qualified as well.
Ask for some references and then check them out. Make sure these are real-life ones in a similar position to yourself, and not just general testimony-ones within marketing blurb.
Clarify how they are insured as a firm so that if there were any mistakes that caused you a loss then this insurance could cover this.
Always check the small print before you sign. Ideally get someone qualified like a solicitor to check, particularly for larger and longer term instructions, and make sure you actually understand the gist of what they’re trying to say.
The range of sizees of an accountancy firm can be vast, right from an individual accountant sole-trader to a large international firm. There are pros and cons to each type in terms of the level of service, attention given to clients, and back-up resources received, so make sure it’s clear what these are.
Check out how many branches they have and where they are. They may be regional but have numerous branches in local towns, or only a few on a national scale and a regional one happens to be in your town.
Also, check how long these have actually been integrated into the firm as often there are take overs with other firms to bolt-on numbers and appear bigger than they actually are.
Makes sure you understand what other services the firm do. Even though these may not be needed by you now, you may do in the future in which case it's worth knowing that these are available if needs be.
However, don’t assume the same firm will automatically provide say bespoke tax advice if they have just been doing your book keeping, still shop around and ask the firm for a definite quote.Write comment (0 Comments)
In our expereince of clients finding the right local accountant in Walsall, and even after the process of finding and selecting the right firm there was the question of how they were correctly instructed and then information supplied to them. One of those tasks we all assume is straight forward, and to some degree should be, although in reality it does require thought into how this is done so that the expectations between yourself and the business on both sides are clear.
Infact the lessons from these can be applied to any business really not just a firm of accountants, and can be boiled down to 3 simple points – all beginning with the latter I to keep nice and simple, and all showing a different aspect of that ever-so-important ‘paperwork’ to get the instruction and service right from the start.
That very first confirmation in writing with the local business to instruct them to carry out whatever you want them to do. The golden rule is for it to be in writing, and as clear as possible. And remember that it’s the quality of the information that’s important rather than the style or even format of information – so an email referring to the correct points is more effective than a lengthy headed-paper letter that misses things.
Make sure you go through the Terms & Conditions both the unique ones you have agreed for your instruction (and clearly detailed) but also those standard T&Cs often in a lengthy small-print somewhere but worth wading through. All it takes is just one change that’s needed for your requirements and you can simply ask to have this noted as an agreed amendment in your written instruction.
It’s also worth taking a step back from all the micro detail and make sure it has logical steps in there – so being clear who supplies what info, for someone to then supply a result or ‘draft’ in whatever times frame and format, for other steps to agree changes and a final version.
Make sure you know who needs what information to get on with the instruction. Typically this will start with the client providing information to the business so they can begin their work, for them to then provide results.
So with an accountant there will be various documentation such as invoices and receipts, bank statements and summaries, and files of related documents – but also things you may take for granted like access to online accounts and whether these are released, and whether the information needs to be hard-copies sent in the post or hand delivered or whether you can simply attach in an email or even give online account details to access as and when.
The dreaded part where you have to pay and which seems straight forward, but make sure you understand right from the start how this will be issued. For example, whether there will be VAT added, which will be another 20% automatically on the charge if you’re not VAT registered. Plus, check that there are no others on the way as well, maybe interim ones or added ‘expenses’ or disbursements’.
Even the timing of these need to be understood, whether just one invoice at the end of the work and how long you have to pay it, and whether they will be phased through the job. Therefore don’t rush, get the 3 ‘I’s sorted right at the start of the instruction.
After you have the basic terms agreed for your accounting or infact any business need, then don't stop there. Make sure the detailed is irnoned out so it doen't come back to bite later on.
Get the instruction clean, the information supplied, and the invoice issued.Write comment (0 Comments)