I think that must be the question a lot of start-ups, and even some more established companies ask themselves.
And I’m sure most of those organisations come to the same conclusion – because they have to. After all, who else would be able to file the returns with HMRC, and who else knows how to do the bookkeeping (and who else wants to do that…).
But I wonder how many of those leaders choose to engage an accountant because they want to?
Perhaps the reason that so many feel forced to engage the services of an accountant is because accountants don’t make it clear what they can offer a start-up – or even any business.
A qualified accountant has studied for at least three years to gain their accreditation, quite often longer. They will have understood many parts of an organisation; sales, purchasing, payroll, logistics as well as the technical side of accounting.
Their training allows them to map the flow of a process, how a system works or understand the parts of the company that are weak. It’s not a coincidence that so many qualified accountants become CEO’s – around 30% of FTSE 100 CEO’s came from a Finance background.
Absolutely your accountant should be able to file your tax return, and calculate your tax liabilities, but what else could you ask your accountant for?
An accountant should be able to analyse your business and advise you on what has been going well, and what is struggling. They should be able to build targets and growth plans, and advise you on strategies to achieve those.
They can help you find sources of finance, build a business plan, and help you understand your business, through analysing your data;
How many customers do you need each month to simply make it worth opening the doors?
What’s your most profitable product lines? (Product profitability/mix analysis)
How much stock can you hold, and how quickly could you sell ALL of that stock? (Inventory management)
How long could you continue if your customer base disappeared? (Liquidity)
All sorts of ratios and variances that can help your business thrive and grow.
And all you need to do is ask your accountant, can they answer? adds accounting can!
Kenneth Gladman
That is pretty interesting that most CEO’s come from a finance background. It makes it very intriguing and attractive to have a qualified accountant on your businesses side. Their knowledge on financial matters can be very valuable.