As a small business owner who has done your own books, chances are that at least once you have found yourself swamped with a terrifying pile of invoices, statements and receipts that you just can’t get your head around. It’s at times like these that you have probably considered calling in the professionals – biting the bullet that comes in the form of an accountant’s expenses. However, there is no doubt that an accountant will help you to keep your books in order, tighten up budgeting and give you invaluable financial pointers. You may even find that you end up saving money. Let’s take a look at the pros and cons of going it alone and hiring an accountant.
Doing your own books can distract you from doing what you do best – running the day to day operation of your business. You may lose focus on your goals, letting them slip by the wayside and become overwhelmed. This can have not only a detrimental impact on your bottom line, but also your mental health.
But it keeps you in control
Doing your own books and payroll, you get to see your figures in bold and clear terms and this can be invaluable when it comes to understanding just how good or bad things really are – giving you time to plan your next move. This can result in you making better business decisions. Should a supplier or vendor make an error, being in control means you will be able to act on it straight away instead of weeks or months down the line, when your bookkeeper brings it to your attention. You could even end up with the peace of mind that can be hard to come by unless you explicitly trust your accountant.
Lost Opportunities and increased liability
Not employing a specialist accountant could mean that you miss money-saving tricks and fail to take advantage of quirks in the tax laws that could save you a lot of money. You will also risk missing out on the full scope of deductibles or tax credits that can be offset against hefty tax bills. In terms of liability, HMRC does not accept the existence of ‘innocent errors’ in a tax return and as such, going it alone can expose you to potential problems with HMRC down the line.
The ideal compromise
Let’s get things straight. Hiring an accountant is a strongly advised route for nearly all small to medium sized businesses. However, this does not mean that as a small business owner you should relinquish all control and wash your hands of the accounting side of your business. Asking the right questions, holding regular meetings with your accountant and making sure you explain at least the key elements in the accountant’s strategy will help you feel like you still retain some control and reduce the risk of errors and help you to action any changes swiftly and without delay. It all comes down to maximising your own time to enable you to do what you can to help your business grow.