Accounting firms are an important aspect of any business. They help ensure that the company is working within the confines of the law while also helping them to keep track of both their assets and liabilities. Accountants also serve as a line of defense to help businesses avoid costly mistakes that can be prevented.
Here are other ways that professional accounting firms can help businesses spend less while generating more revenues:
1. Improve Business Efficiency
Efficiency is the ability to use fewer resources to produce more. There are many ways to improve efficiency in your business. These include reduce idle time, waiting, and delay. Businesses can also improve workflow, productivity, and output and use more flexible working hours to facilitate more efficient usage of resources.
On the other hand, accountants can also make businesses efficient by helping them manage one of the most valuable resources: money.
- Perform careful review of invoices and bills to ensure that they are reasonable and within the client’s budget
- Review company allowances, such as entertainment allowances, to make sure they are not exorbitant and still reasonable
- Supervise staff to ensure that they don’t abuse company policies such as entertainment allowances or travel expenses
- Improve cash flow and liquidity with their knowledge and familiarity with different types of bank loans and how they can benefit your business, which is particularly important if the economic climate is uncertain
2. Take Advantage of Capital Allowances
Capital allowances reduce the amount of tax you pay. Business owners and accountants can closely monitor how much capital allowance is being claimed as it can affect your business’s taxable income. They can:
- Ensure that documentation for capital allowances are accurate, complete, and up-to-date
- Periodically review claims for capital allowances so as not to lose out on opportunities to claim
- Review fixed assets regularly because the depreciating value of these assets can reduce their taxable income and hence their overall tax liability
- Watch out for asset revaluation, particularly if there is a change in the market environment or technology, which can greatly affect the value of assets
In many situations, however, accountants and businesses fail to maximize this deduction. To ensure that they do, they can work with people specializing in capital allowance for accounting firms
3. Offer In-depth Analysis as a Value-Added Service to Clients or Business Owners
Accountants are trained in all the latest accounting practices. This enables them to provide an in-depth analysis of any company’s finances. They can, for example:
- Conduct a financial review of the business’s activities and document findings
- Assist in budgeting, which is particularly important for businesses that are just starting or undergoing major changes in management
- Assess the accuracy of financial statements and provide feedback, particularly if there are any irregularities
- Analyze monthly income and expenditure reports to identify areas where clients can save money
- Provide recommendations on how clients can improve their business structure and practices to increase profitability or reduce spending
4. Provide Additional Services as a Side Business to Increase Revenue
One way that accountants can help businesses save costs is by performing tasks as a side business. This enables employees to focus on their core competencies while hiring an accounting firm to perform services such as data entry, bookkeeping, and payroll processing.
In addition to increasing revenue, this increases the scope of services available to clients. For instance, clients can take advantage of these services to improve their financial literacy with accounting courses offered by accounting firms and organize and simplify the filing of financial statements and other records for better tax filing compliance.
Other services that can be provided as a side business include offering legal advice on business contracts, managing email marketing campaigns, providing HR advice for companies, and offering financial consulting services.
5. Implement Cost Controls via Processes and Systems
Businesses can implement cost controls via processes and systems. Accountants can suggest or create these systems to ensure that the business is running efficiently and within budget. Some examples include:
- Entering invoices in batches rather than one by one to improve accuracy, reduce errors, and save time
- Using automated payment reminders to prevent late payments and reduce accounting fees
- Using automated payroll and saving time and avoiding penalties for late payments and the need to track missed deadlines
- Implementing an approval workflow system to manage tasks assigned to staff, such as sending invoices or approving expenses
As can be seen, accountants have a significant role in helping businesses reduce their costs and expenses. They can do this by providing valuable services that save time and money while ensuring legal compliance. This includes making sure that companies maximize deductions under capital allowance to improve tax efficiency.
Accountants can also provide services to help businesses run efficiently by using cost controls via processes and systems. This includes streamlining business practices through automation, which reduces costs and increases the company’s productivity.