When it comes to hiring a professional accountant for one’s business, the decision is generally undertaken when the business in question is undergoing a variety of financial challenges and is in dire need of expert help. In most cases, businesses tend to go it alone in the hopes that they will eventually sustain themselves. On the contrary, this has become one of the biggest causes for many businesses to go bankrupt in recent years. According to the Office for National Statistics, 20% of companies within the UK fail to fully establish themselves in the first year while only 42.4% are currently trading five years after inception.
For many who launch their own businesses, it does make sense to take on the responsibility of doing one’s own taxes themselves as a way to save costs. However, as the business grows, the need to hand over these responsibilities to a specialist grows as well. In fact, a professional accountant does more than just help with a company’s tax returns. They can help with longer term tax planning, business planning, networking, and even personal tax planning. In addition, they can assist with bookkeeping, financial review, keeping your business’s financial statements such as your balance sheet, income statement and statement of cash in order as well as provide advice on certain financial problems.
The significance it aside, one of the biggest concerns a business has about hiring a professional accountant is the expense of doing so. Many businesses don’t have the necessary volume of financial transactions to justify hiring a professional accountant. In such circumstances, they end up hiring one that quotes the lowest price for their services.
While such a decision may make sense in the short term, in the long run, it could bring about disastrous results. Hiring a cheap accountant means you get what you pay for, i.e., an unqualified, inexperience accountant who may not necessarily provide you with the quality of service that you desire. In addition, in order to get more clients, they may end up outsourcing their work and not even hire qualified staff, which can have a significant impact on the quality of financial advice that they provide.
If a business were to go out on a limb and hire a professional accountant, not on the basis of price but on the basis of quality of service, then it can expect the following benefits:
- A professional accountant or accounting firm that charges a higher fee may be more qualified to handle a business’s financial management needs. This means that they may have trained at a well-established and reputable firm of Chartered Accountants and hence, have a vast level of experience.
- They may also be in a much better position to hire highly qualified and skilled staff which, in turn, can lead to better resources being allocated for a business’s financial needs.
- Many expensive accounting firms offer personalised service when it comes to handling a business’s financial matters. This shows their commitment and desire to be thorough and acquire the information they need to get to the root of the problem. This gives a chance to businesses to place their trust on the accounting firm and let them take the lead.
At the end of the day, paying a reduced level of fee will only allow you to benefit from a service that attains the bare minimum. By treating the extra expense paid to hire a professional accountant or accounting firm as an investment, a business is bound to benefit tremendously in the long run and be able to avoid the many pitfalls of financial management.