Business accounting used to be pretty simple. Your accountant was responsible for balancing the books, filing tax returns, creating financial reports, and keeping an eye on expenses. An accountant was your numbers person, but not necessarily involved in the other parts of your business.
That’s all changed, particularly for small to medium businesses. Now, a good accountant should be doing far more than just the numbers. With an in-depth understanding of your business, an accountant can help you set goals, improve cash flow, and move your business forward. Your accountant should be able to help with budgeting and forecasting, goal setting and planning, and act as a business mentor.
With high-level expertise and insight into your specific needs, a great accountant should help you move in the right direction – not just keep things balanced.
Here’s what a great accountant could do for your business:
Making plans, setting goals
You can’t move your business forward if you don’t know where you’re headed. That’s why business planning and goal setting are so important – particularly when you first start your business.
A great accountant will be able to help you write business plans and set goals with cash flow and profitability in mind, so you have a structure in place as you move forward.
A business plan is a high-level view of your business, defining your overall vision and giving you a framework for decision-making. Even if you believe that your business is small or straightforward enough not to need a plan, you’ll benefit from getting it down on paper. An experienced accountant can help guide you through the stages of creating your plan, from defining your vision to setting realistic goals. When you’re enmeshed in the day-to-day of running your business, it can be difficult to be objective – your accountant offers an invaluable outside view.
Goal setting is about bringing your business plan to life. By setting short, medium, and long-term goals for your business, and defining the steps you need to reach those goals, you give yourself a clear path forward. An accountant can help you balance ambition with realism, so you’re pushing yourself to grow – but not facing unachievable goals. This is particularly true for goals around profit-making and cash flow.
Keeping money moving in your business
When you start your first business, budgeting and cash flow can be difficult to get your head around, particularly if you’re not a numbers person. By helping you create a budget and manage your cash flow, an experienced accountant can get you through the notoriously difficult first few years in business.
Budgeting helps you prioritise spending and maximise profits, while cash-flow forecasting ensures you have ready cash to hand when you need it – for example, when that first year’s tax bill comes in. Without someone to help you manage the money side of the business, it’s far too easy to overspend, undercharge, and end up making very little money from your business. Worse, if you mismanage spending and cash flow grinds to a halt, your business could fail. A yearly budget and cash-flow forecast, set and reviewed by an expert, are essential for small business owners.
Guidance and accountability
In business, as with everything in life, you don’t know what you don’t know. When you’re just starting, figuring out exactly what you need to do can be overwhelming. Taxes, PAYE, budgeting, invoicing, communicating with clients, advertising and marketing – it’s an endless list. You know what you’re doing when it comes to your product or service but managing everything else may not be in your skillset.
Having your accountant act as a business coach or mentor helps you fill in those gaps. You’ll get help with the practical elements, like taxes and payroll, and have a sounding board for ideas and decisions as your business grows. Having regular meetings to discuss progress and review your business plan also keeps you accountable – you’re more likely to stay on track if you have to report back to someone else.
Way beyond numbers
The right accountant goes way beyond the numbers to help you formulate a business plan, set goals, create a budget, manage cash flow and even act as a mentor as you learn to run your own business.
Looking for an accountant to help you push your business forward? We can help. Talk to the team at Thrive now.