When it comes to managing your company funds, it can all feel a bit daunting. This is particularly true for small businesses, as starting is never easy without a large team. This is when business accounting and finance management can come in handy, and transform your struggling business into a successful one.
In this article, we will cover the definition of business accounting and finance management, and how they both should be implemented in your company. We will then discuss what an accountancy company can do to ease the stress of managing your funds, and how specifically our team at Michael Filiou Ltd can offer the best quality service available.
Definitions
To implement both business accounting and finance management, it’s important to know what each term means beforehand. Luckily, we will cover the definitions of both in this section of the article. This should help you to have a better understanding of how to help your business.
What is business accounting?
Business accounting is the process of analysing the data gathered about your company. This should result in the production of financial statements, the monitoring of transactions, and knowledge about the activity of your business. This process is used to ensure a company is performing as it should and to optimise profits.
What is finance management?
Finance management follows what has been learned about the financial condition of a company after analysing the data. It entails making decisions about how to improve the well-being of a business. This could include reducing the range of products you offer or instead expanding your range, depending on what you need to obtain.
Why Do Businesses Need It?
Companies are required to do a lot of financial legwork, from paying taxes to organising the payment of wages. Before starting up a business, it’s vital to know what will be required of you during the lifetime of your company. In this section, we cover what you need to know about business accounting and managing finances.
Legal Requirements
Besides the other pressing needs of having a company, your business will have many legal responsibilities. Taxes are expected and charged in a very different way in comparison to your individual responsibilities.
How much tax is charged on your business will also differ depending on your company type. How you pay yourself as the owner will affect your tax too, as well as the profit your company earns. Accounting will help you know where your money is going and coming from, and therefore calculate how much tax you owe.
Record Keeping
In addition to paying business taxes, it’s important to keep sufficient records of all payments and expenses. If you are ever called upon for receipts and evidence of payments, your records will be needed, so it’s important to store them properly, where they are accessible.
Payroll
Paying your employees needs to be efficient. You and your business have a responsibility to pay your staff correctly and at the agreed time. Late payments will put your staff in a position to take legal action against you, making it vital that you pay wages on time and correctly.
Business accounting is needed to make sure your payroll operates as it should. It includes monitoring the hours your staff have worked, and organising how to pay them correctly under the correct tax code.
Growing Your Business
To grow your business, it’s important to know what products are successful and earn you money. Without this, you may unknowingly be putting funds in the wrong places, causing money to be lost instead of earned.
Accounting can help you learn what is profitable, and what has become a hindrance to your business. Tracking sales can highlight which products you should expand upon, such as offering more affordable options or selling items as part of a package.
Applying It To Your Business
Once you know what business accounting and financial management entails, you can begin to think about how it might apply to your business. We have listed a few things to think about to apply to your company.
Storing Your Records
As mentioned above, keeping track of the movements of your money is important. The storage of records needed for tracking your business transactions should be stored safely and securely. Paper records, however, can be difficult to store, and are easily destroyed.
When storing your receipts and statements, try doing so digitally. This results in accessible and backed-up information, which can be compared easily and sent across to others when needed.
Paying Taxes
Business accounting should be used to show when paying your taxes. Calculating exactly how much you owe is vital to ensuring you are not liable for legal action to be taken against you. If you feel under stress with calculating your taxes, try finding a technological solution that can help you.
Performing Regular Checks
In our modern age of technology, online accounting solutions can be a great help in monitoring where your funds are originating from. These records need to be compared with one another to get a good sense of how your company is performing month-to-month, so performing regular checks is never a bad idea.
Regularly checking the financial status of your company can also show you when you have been most successful, and warn you of any potential problems that may arise at a later date. You can also predict what you should be doing in the following months, based on patterns found in past performance.
Using an Accountancy Company
A financial consultancy firm can be a great help when it comes to business accounting. Financial management services are very useful for helping your company grow into a new stage of success. Read on to learn more about what they do and how they can benefit your business.
What They Do
One of the most important things an accountancy company can do for your business is to prepare for taxes to be charged. It can seem daunting to get things in order alone, which is why an expert firm can be a great help. The taxes your company pays will be monitored by an accountancy company, meaning you may even end up getting rebates.
An accountancy company will provide your business with advice, to help your business perform as well as it can. It can prevent your company from landing in financial trouble, as well as help your business grow to its full potential. Having dealt with a variety of other issues with similarly sized businesses, they should be experienced in getting your business out of hot water should the worst happen.
Benefits
As mentioned, storage can be a pain when it comes to records. Thankfully, bookkeeping performed by an accountancy company will be a great help. They can track spending, to see where most of your budget is going and hopefully reduce unnecessary expenses.
By employing a firm, you won’t have to worry about being left high and dry. When hiring an independent accountant, often you can feel worried that they can’t provide all the services you need alone. A firm specialising in small business accounting can give you the personal touch you need while providing the services of a larger-scale firm.
Payroll processing no longer has to be a concern when you hire an accountancy firm to manage it. Their professional care ensures that your staff’s wages are received on time. The funds need to be calculated accurately, which is exactly what a firm should specialise in.
Our Work
While business accounting can seem frightening at first, our team can help with all your concerns. At Michael Filiou Ltd, we are experts in small business accounting. We provide relationship-based services which can be expertly tailored to your needs.
From tax planning to crisis management, our team offers a range of services that act both as preventative and reactive measures. We can assist with any of your business accounting needs, which helps provide the support needed to help your business grow. In addition, we have a range of online practical support solutions, known as our knowledge base.
Visit our website to learn more about us and what we can do for you. Alternatively, contact us directly for more information.