Is Small Business Accounting Necessary?

Is Small Business Accounting Necessary?

As a small business owner you may be used to taking on many different roles and are wondering if accounting is one of those tasks you can try to do on your own. However, small business accounting can be difficult and it can end up costing you a lot more if you try to do it yourself – either in monetary value, time, or lost opportunities. Especially if your business is successful, there comes a point where your time is the most valuable asset you have and is better spent creating value for your company rather then balancing books or filing tax returns.

Having a professional chartered accountant do your accounting also has the following benefits for small businesses:

  1. Creating Forecast Financial Estimates: Small businesses may be required to provide lenders or investors with a financial forecast which includes an economic forecast, expenditures, and pro-forma financial statements. This information is heavily relied upon by outside lenders in order to have an accurate and accountable snapshot of the businesses financial wellbeing.
  2. Determine Profitability: Although your small business may be generating a high revenue, if your profit margins aren’t up to par with your cost of inventory then your business is at risk. Banks and investors may also require profitability reports and forecasts to determine if the business will be able to repay their loans in a timely manner.
  3. Expert Insight: Chartered accountants have gone through extensive education refining their expertise in a wide range of topics and have years of experience. Their expertise allows them to provide you with insight into how your business can lower costs, reduce the amount of taxes you’re incurring, defer start-up costs. file tax returns, and ensure everything is running smoothly.

Finding a great small business accountant in Toronto can be difficult, but it is definitely worth it to find the right chartered professional account for your company.