Many small business owners struggle with cash flow and can't quite afford to staff an internal accounting team full time. However, they can always benefit from outsourcing certain areas of their accounting function to an accounting service provider.
Accounting firms can provide a variety of services to help manage your small business' financial information. Below are a few critical accounting services that you can farm out to an accounting service provider.
Accurate and timely recording of all financial transactions of your small business is essential to facilitate the preparation of financial statements.
An outsourced accountant will create source documents, such as ledger and journal entries that help keep track of all money received by your business and all funds paid out. This is called bookkeeping.
Bookkeeping helps to know your cash in hand, cash at bank, accounts receivables and accounts payables. It can also be used to reconcile the financial data recorded in the books with the balances at the bank. Bank reconciliation helps to detect potentially fraudulent activity.
The information collected through bookkeeping will help you stay up-to-date with cash flow and the overall financial health of your business. You can make well-informed financial decisions based on this information.
Financial statement preparation isn't for the big boys only. Start-ups and small businesses are also expected to prepare financial statements to help keep track of their performance year in and year out.
Creating financial statements, such as balance sheets and statements of income ensures compliance with legal requirements for businesses but also helps you assess if your finances are in order.
Tax Preparation and Filings
Regardless of size, all businesses must file tax returns correctly. Business taxes are an important source of government revenue and you'll get into legal trouble if you don't file yours on time.
Even though there are lots of different kinds of tax software you can use to prepare and file your business' taxes, tax preparation and filing can be a real pain if you don't know how to go about it.
Outsourcing an accountant will help to ensure a smooth, fast, and efficient tax preparation process so you can have peace of mind knowing your taxes have been compiled correctly and submitted on time.
The major advantage of using an outsourced accountant is that they can provide services tailored to your business' specific accounting needs and work on an 'as-needed basis'. This means you only have to pay for the services that you need when they're needed. Contact a small business accountant today if you're ready to farm out your business's accounting function.