For many business owners and directors, their accountants already provide a valuable service in helping them prepare and file accounts as legally required.
What they might not appreciate is that there are many other ways in which they can help a business achieve greater profitability and improve their liquidity and cashflow both this year and beyond.
ICAEW CEO Alan Vallance said: “Accountants have a critical role to play as custodians of trust, ensuring businesses operate ethically, transparently and sustainably.
“Businesses want long-term incentives to invest, employ more people and stimulate growth.”
The good news is that accountants can help provide them.
As well as helping with bookkeeping and tax preparation, there are many other ways in which they can help their clients achieve greater financial success and sustainability this year and beyond.
Read on for some more ideas about future conversations you could have with your accountant about getting more from your professional partnership!
Financial Management & Planning
- Budgeting and Forecasting: Creating realistic budgets, forecasting future revenues and expenses, and monitoring performance against the plan. This helps businesses allocate resources effectively and anticipate future cash flow needs.
- Cash Flow Management: Analyzing and optimizing cash flow to ensure the business has enough liquidity to meet its obligations and invest in growth. This can involve managing accounts receivable, accounts payable, and inventory efficiently.
- Profitability Analysis: Identifying areas where the business is most and least profitable, analyzing costs and pricing strategies, and recommending ways to improve margins.
- Financial Statement Analysis: Interpreting financial statements (balance sheet, income statement, cash flow statement) to provide insights into the company’s financial health, identify trends, and make informed recommendations.
- Cost Accounting: Tracking and analyzing the costs associated with producing goods or services, helping businesses understand their true costs, optimize pricing, and improve efficiency.
- Financial Modeling: Creating models to simulate different scenarios (e.g., changes in sales, expenses, or interest rates) and assess their potential impact on the business.
- Developing Key Performance Indicators (KPIs): Identifying and tracking relevant metrics to monitor business performance and measure progress towards goals.
Strategic Advisory & Growth
- Business Planning: Assisting with the development of comprehensive, up-to-date business plans, including financial projections, market analysis, and growth strategies.
- Strategic Financial Advice: Providing guidance on major financial decisions, such as expansion, mergers and acquisitions, capital investments, and financing options.
- Risk Management: Identifying potential financial risks and developing strategies to mitigate them.
- Succession Planning: Helping businesses plan for the future, including ownership transitions and leadership changes.
- Business Valuation: Determining the fair market value of the business for various purposes, such as selling the business, securing financing, or estate planning.
- Benchmarking: Comparing the business’s financial performance to industry averages to identify areas for improvement.
Compliance & Operations
- Tax Planning and Compliance: Ensuring the business is compliant with all relevant tax laws and regulations, minimizing tax liabilities, and maximizing tax benefits.
- Internal Controls: Implementing and monitoring internal controls to safeguard assets, prevent fraud, and ensure accurate financial reporting.
- Audit Preparation: Preparing for and facilitating external audits, ensuring financial records are accurate and compliant with accounting standards.
- Payroll Management: Processing payroll accurately and efficiently, ensuring compliance with payroll tax laws and regulations.
- Software Selection and Implementation: Helping businesses choose and implement accounting and financial management software that meets their specific needs.
Beyond the numbers
- Acting as a Sounding Board: Providing objective advice and insights on business challenges and opportunities.
- Connecting Clients with Resources: Leveraging their network to connect clients with other professionals, such as lawyers, bankers, investors and insolvency practitioners.
- Providing Industry Expertise: Sharing knowledge and insights about the client’s industry, including best practices and emerging trends.
- Mentoring and Coaching: Providing guidance and support to business owners and managers, helping them develop their financial management skills.
Obviously not every accountant will offer all of these potential advantages and services but it’s certainly worth a conversation to see if they can do more to help you achieve short and long-term success and financial stability.
Your accountant will also be able to help if you’ve decided to make a change in your career and want to close your business down.
We offer a free initial consultation with any business owner or director who wants to explore what options are available to them including what their accountants can do to help speed the process along with a minimum of fuss and stress.