Lots of businesses undergo through bankruptcy and liquidation since their accounting practices are improper. An accountant plays an important role in an organization since money management is one of their key roles in addition to keeping proper accounting records for each and every activity. The reasons why a business needs an accountant are plenty and the following are some of them:
Accountants make certain that the financial statements that are prepared conform to International Accepted Standards or (IAS). The presentation as well as the preparation of business financial statements is based on a number of accountings standards that are accepted and used worldwide. The accountant is guided by these standards and the resultant financial statements give a fair or true value of the business' financial position.
The management as well as the control of funds within a business falls under the jurisdiction of the accountant. An internal control mechanism to control funds is developed by an accountant as well. The main task of the system is to stop or prevent the misuse as well as the embezzlement of funds in businesses. It offers guidelines on the modality in which transactions will be handled; this locks out any loopholes which might lead to funds embezzlement. These internal controls normally assist the business to attain certain objectives, tasks and goals. Systems of funds control are crucial for the long term survival of the business and thus they are a must for them to be developed by the accountant.
The other important reason why a business needs an accountant is for taxation purposes. Tax planning permits the business to develop a plan for anticipated revenue in the years that follow. The plans may assist in the management of money in a way that maximizes the businesses tax benefits. The benefits of this include spending less time in taxation processes and using the spare time in concentrating on other income generating activities. Timely filing of tax returns also assists the business in avoidance of penalties on late payment which saves some money for the business. The business will also be able to avoid overpayment of tax which means that they will not have money that is tied in tax refunds.
Budgeting along with forecasting of business revenues is capable of being prepared properly by accountants. This is attributed to the actuality that the accountants have vast knowledge of operational costs as well as the flow of business revenues. The above processes of forecasting plus budgeting permit the businesses to formulate projections of revenues into the near future. These formulations can lend a hand to the business to institute its growth predictions in addition to planning for whichever anticipated disruptions that may occur in cash flows. This practice is usually founded on the concept of going concern which is part of the Generally Accepted Accounting Principles that each and every accountant is required to follow in the accounting profession.
The above discussion demonstrates that accountants are important in whichever business in view of the fact that they ensure that the flow of cash is monitored strictly. It is understood that the person who controls or manages the funds of a business is the ones who is in control of a business. It is sensible given that profit maximization forms the major aspiration of a large amount of businesses plus this may prove to be difficult to attain without any accountants being in control of the funds. As a result, flourishing businesses are the ones which have accountants. - 31393
Accountants make certain that the financial statements that are prepared conform to International Accepted Standards or (IAS). The presentation as well as the preparation of business financial statements is based on a number of accountings standards that are accepted and used worldwide. The accountant is guided by these standards and the resultant financial statements give a fair or true value of the business' financial position.
The management as well as the control of funds within a business falls under the jurisdiction of the accountant. An internal control mechanism to control funds is developed by an accountant as well. The main task of the system is to stop or prevent the misuse as well as the embezzlement of funds in businesses. It offers guidelines on the modality in which transactions will be handled; this locks out any loopholes which might lead to funds embezzlement. These internal controls normally assist the business to attain certain objectives, tasks and goals. Systems of funds control are crucial for the long term survival of the business and thus they are a must for them to be developed by the accountant.
The other important reason why a business needs an accountant is for taxation purposes. Tax planning permits the business to develop a plan for anticipated revenue in the years that follow. The plans may assist in the management of money in a way that maximizes the businesses tax benefits. The benefits of this include spending less time in taxation processes and using the spare time in concentrating on other income generating activities. Timely filing of tax returns also assists the business in avoidance of penalties on late payment which saves some money for the business. The business will also be able to avoid overpayment of tax which means that they will not have money that is tied in tax refunds.
Budgeting along with forecasting of business revenues is capable of being prepared properly by accountants. This is attributed to the actuality that the accountants have vast knowledge of operational costs as well as the flow of business revenues. The above processes of forecasting plus budgeting permit the businesses to formulate projections of revenues into the near future. These formulations can lend a hand to the business to institute its growth predictions in addition to planning for whichever anticipated disruptions that may occur in cash flows. This practice is usually founded on the concept of going concern which is part of the Generally Accepted Accounting Principles that each and every accountant is required to follow in the accounting profession.
The above discussion demonstrates that accountants are important in whichever business in view of the fact that they ensure that the flow of cash is monitored strictly. It is understood that the person who controls or manages the funds of a business is the ones who is in control of a business. It is sensible given that profit maximization forms the major aspiration of a large amount of businesses plus this may prove to be difficult to attain without any accountants being in control of the funds. As a result, flourishing businesses are the ones which have accountants. - 31393
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