It goes beyond saying that every company needs an accountant. They deal with the financial aspect of the business and are generally unavoidable. They understand the laws regarding financial matters, and their job is to make sure that you – a business owner or manager – organize your business in a way that is at the same time in accordance with those laws and as profitable as possible. However, there are two general types of accountants on the market, and it is important to be aware of the differences between them.
The first kind is a “regular” accountant. Their responsibilities include providing a complete record of all financial dealings of a company or organization, keeping track of money inflow and outflow, and making sure the business can prove every single one of its money transactions. They need to be aware of federal and local laws and regulations and keep updated on any changes that may occur. They can work for private persons as well as for legal entities, and they specialize in different fields, from fund management to retirement options.
The second type is a chartered accountant. They do all the work that accountants do, and in addition, they are expected to advise their employers about additional ways to make their businesses more profitable. Their work is focused on taxation, auditing, and financial reports, among other things. They have to complete a post-graduate program, and in order to be chartered, they are required to work for three years under an experienced mentor. Also, they can work in various positions and roles, they are not just bookkeepers. Their education and versatility mean that they are in higher demand than accountants, so their prices are usually higher. Here are some reasons why hiring a chartered accountant pays off in the long run.
1. They do auditing work
Auditing work is basically about checking your company's financial statements, accounts and books in order to make sure that it is doing its business well and in accordance with the law. It is usually done because the stakeholders require some kind of assurance that their money is being used in a best, most profitable way. A chartered accountant can make sure that all the auditing reports are as good as possible while keeping you safe from frauds and theft within the company.
2. They handle your taxes
Obviously, one of the primary responsibilities of an accountant is handling the taxes. Because taxes are involved in every aspect of the business, every company needs a person who understands the laws and regulations well. Chartered accountants prepare tax statements and ensure that your business runs smoothly. Furthermore, they can create strategies to help you deal with tax deferral, problems with taxes during mergers and acquisition, and so on. In most countries, such as the USA or Australia, taxes and the laws surrounding them are quite complicated, so hiring good chartered accountants in Sydney, for example, can save you quite a bit of a headache.
3. They supervise the payroll
One of the primary responsibilities of an accountant is supervising and keeping a record of employee's compensation. Of course, this includes wages, commissions, and bonuses, but that is not all. Their work includes withholding of payroll taxes and withholding for health insurance premiums, savings plans, and so on. Chartered accountants make sure that everything goes without a glitch and in accordance with the law.
4. Their advice may be crucial
In matters such as mergers, acquisitions, and purchases, a chartered accountant can be extremely valuable. Accountants are a disinterested party in all of those processes. They have one job and one job only – to make an impartial judgment on how the purchase will affect the company. Their job is to predict possible future accounting issues, as well as risks and opportunities. Therefore, having a chartered accountant involved in the decision-making process may prove to be essential for the future well-being of your business.
5. They can work as management accountants
Management accountants work for one company only, and they are a part of its management team. Their job is to make sure that the company is financially secure. They have various responsibilities which include taking part in strategic planning. They also have to work with auditors and investors, which makes them a valuable asset to any company.
6. They do budget analysis
The budget analysis includes designing budget models for a company or some departments in a company, as well as presenting annual budgets to managers. However, the most important part of the job is the analysis of the financial information – expenditures, revenues, etc. – in order to ensure that all the business is done within the budget of the company. Since it is a goal of every business to earn more than to spend, it is easy to see how important this job actually is.
7. They can boost profitability
A good chartered accountant can really boost the profitability of your company. They can find tax relief schemes, grants, and similar, but there are many more ways in which they can benefit your company. Thanks to their skills, they can negotiate with suppliers, remove unprofitable products or services, maximize pricing and reduce debts. Hiring a chartered accountant can go a long way in the matters of profitability, which is arguably the most important aspect of a business.
Even though chartered accountants are a bit pricier than bookkeepers, their skill set makes them a worthwhile investment. There is plenty they can do for you and your business, so hiring them undoubtedly pays off in the long run.