Accounting is often treated as an administrative necessity, little more than a small cog in the functioning of a much larger organisational machine. Accounting is not only vital for the legal compliance of businesses in the UK, but also for smooth functioning, equitable growth and long-term success. This is why the UK’s accounting sector is worth well over £220 billion.
From ensuring compliance with financial regulations to providing valuable insights for informed decision-making, professional accounting services are nothing short of indispensable. But what exactly is it that a professional accountant does, and how do they service businesses for the betterment of their future?
Understanding the Role of an Accountant
Put simply, accountants are financial professionals who specialise in the managing and analysis of financial information for businesses. This naturally involves the keeping of financial records for reporting and tax purposes, but also extends beyond – to the conduction of audits and provision of strategic, targeted financial advice. In this way, an accountant is at once a financial administrator and trusted advisor, helping businesses navigate the complexities of financial management while ensuring legal and regulatory compliance.
The Benefits of Professional Accounting Services
Many businesses, particularly larger ones, have in-house accounting departments to handle finances, accounting and reporting internally. However, this is not the case for all business. Some require the services of professional accounting enterprises, as with small start-ups seeking growth with a lean staff infrastructure.
Outsourcing accounting services is a cost-effective route for small and medium-sized enterprises (SMEs) in this regard. By relying on the expertise of external accountants, businesses can avoid the costs associated with employing a full-time in-house team, while also freeing up valuable time and resources from existing staff. This allows the team and its executive staff to focus on core operations and strategic initiatives.
It is also the case that third-party organisations possess unique expertise and knowledge, enabling them to handle complex financial matters efficiently and accurately. Additionally, engaging professional accountants provides a business with an objective perspective on their financial health – something that appeals even to larger-scale organisations with existing departments.
Key Areas Where Accountants Provide Support
While accountants assist businesses in various ways, one of their primary functions is to ensure accurate financial reporting. They prepare financial statements which provide a comprehensive view of a business’s financial performance.
Accurate financial reporting here is essential for business decision-making, appeasing investors, and maintaining obligations with HMRC. Indeed, accounting is indispensable when it comes to tax planning and compliance. Not only do accountants help businesses navigate complex tax laws, but they can also identify specific and obscure opportunities to mitigate the impact and cost of taxation.
Accountants can also provide valuable advice and analysis with regard to effective budgeting, cash flow management and financial forecasting. Through developing realistic financial plans and tracking performance against KPIs, accountants can help guide businesses to improve, securing longevity in the process.
