Many businesses have gone bankrupt and liquidation in the past due to their poor accounting practices. Nonetheless, an accountant in Toronto plays an important role for organizations. Besides, money management is important for any business to utilize money, spend it, and grow with time. A professional accountant plays a key role in managing financial records and maintaining them for an organization. Further, this isn’t the only reason for a business to hire an accountant. There are many reasons for businesses of all sizes to hire an accountant and manage their financials. We are going to have a look at those reasons in this post, too. It will help you understand why hiring accountants is important for businesses to manage their financials and grow over time.
Why an Accountant?
Here are some of the reasons for businesses to hire accountants in Toronto and manage their financials:
Preparation of Financial Statements as per the Standards:
Accountants can prepare financial statements for businesses in compliance with the international standards. There are a number of accounting standards with acceptance worldwide. Those standards apply globally for the preparation and presentation of financial statements. Moreover, professional accountants ensure they prepare financial statements for organizations they serve while sticking to the applicable standards. It also makes businesses sure their financial statements portray the accurate financial position of the company.
Controlling of Funds:
Controlling of funds is also a vital task that accountants play for businesses. Development of the system for internal control is the responsibility of an accountant. It prevents the embezzlement of money for a business alongside misuse of the money. In other words, it serves as a guideline on how transactions need handling. As a result, it locks out any possibility for use of the money inappropriately. Fundamentally, internal controls aid businesses in achieving specific goals, objectives, and tasks. Cash control systems are vital for businesses to develop, and an accountant in Toronto can help an organization develop them.
Aid in Tax Planning and Filing Taxes:
Another important reason for businesses to hire an accountant is for taxation purposes. Tax planning also allows the business to develop a tax plan for expected revenue in the following years. In addition, outsourcing tax services in Toronto from a top firm, like GTA Accounting, helps businesses minimize their tax burdens and claim all eligible refunds. Tax planning aids businesses in managing the money that maximizes tax benefits for them. Tax planning benefits include spending less time in taxation processes and using the available time on income- generating activities.
Filing tax returns on time also helps businesses avoid tax penalties which may result due to late tax payments. In other words, filing tax returns on time helps businesses save their money. Plus, businesses that file taxes on time don’t also tie their money with refunds they are eligible for.
Budgeting & Forecasting:
Accountants can properly do budgeting alongside forecasting of business revenues. Accountants have a vast knowledge of operational costs as well as the flow of business revenues. Forecasting alongside budgeting allows businesses to formulate projection of revenues into the near future. These formulations also help a business predict its future growth and do planning to wisely utilize money if anticipated disruptions occur in cash flows. Budgeting alongside forecasting is usually done based on Generally Accepted Accounting Principles or GAAPs. Besides, every accountant needs to follow GAAPs in the accounting profession.
Top accounting firms also offer business advisory services to help businesses make the right decisions. Accounting firms with highly qualified accountants, such as CPAs, typically offer business advisory services. CPAs in such firms offer advisory services to businesses on different matters that are usually related to profits. For instance, they may advise an entrepreneur or a startup whether to step into a certain niche or not based on their experience related to the industry. Or, they may give tax advice to a business to help them minimize tax burdens. Nonetheless, advisory services that top accounting firms can offer businesses are more than the ones we have mentioned.
The key roles that accountants play for businesses play a vital part in organizations concerning money management and business growth. Further, highly qualified accountants and accountants with vast knowledge & experience can benefit businesses even more. Nonetheless, the most important role of accountants in organizations remain properly keeping and maintaining the financial records of the company.
Many businesses have gone bankrupt and liquidation in the past due to their poor accounting practices. However, businesses that hire accountants properly manage their financials and wisely utilize money, which help them grow their business over time. An accountant in Toronto plays several roles for businesses. Plus, the following are some of the main duties of accountants in organizations:
- Preparation of Financial Statements as per the Standards
- Controlling of Funds
- Aid in Tax Planning and Filing Taxes
- Budgeting & Forecasting
- Business Advisory