Your accountant as your new best friend – part 2

In the second part of a two-part blog, IAN LOWRY explains the role that accountants can play in offering their clients business advice.

I’ve already outlined how important accountants can be to a business owner or manager when the company is just getting started. As your enterprise grows, however, there are plenty more opportunities for your accountant to act as a trusted and influential adviser. Critically, they will be able to ask you questions and challenge your strategy from an impartial perspective.

Most straightforwardly, there will be those regular meetings in which you review accounts and look back at what has been happening over the past year.

Perhaps the accountant spots that you’ve taken on sub-contractors? They appear at first glance to be self-employed, but might the Revenue argue that they’re effectively employees, leaving you liable to pay their national insurance contributions and additional penalties? Maybe there has been an increase in advertising expenditure in the same period. Is there a reason for this and is it possible to demonstrate that it’s been effective at bringing in new business?

All kinds of other issues might arise, of course. In the age of cloud computing, maybe it’s pointless to invest in costly new IT equipment. Your accountant may be able to provide some expertise in this area and draw on the experiences they’ve gained through supporting other clients. What about your insurance policies? Are you covered in the event of key people within the business moving on or becoming incapacitated?

Most fundamentally, your accountant can look at your profit figures and help you to set them in a wider context. Is the market shrinking or growing? What are competitors doing? It might be that you need to look at refocusing your business on areas that are most profitable.

Your accountant should be aware of important legislative changes – pension auto enrolment, adjustments to retail rates relief and so on. They should also help you look to the future and think about strategies for organic growth, acquisition and the raising of finance.

Last, but by no means least, you may want advice on an exit some years down the line. Do you need to think about succession planning? Or consider the respective merits of a trade sale against, say, a management buy-out?

Whatever the size of your business and your long-term goals, your accountant really can become an adviser, impartial sounding board and friend. So make the most of them!



DNG Dove Naishwww.dngca.com
Twitter: @dng_ca
Facebook: DNGDoveNaish 

Is your accountant your new best friend?

Accountants aren’t just there to look at the numbers, argues our very own IAN LOWRY. They act as a useful of source of general business advice too. In the first segment of a two-part blog, he outlines the specific ways they can help your company to prosper.

If you think that accountancy is all about compliance work – tax returns and the preparation of formal accounts – then you’re probably underestimating the degree of help that your professional adviser can give you.

It’s worth remembering that accountants are typically dealing with a number of different businesses of varying sizes. These companies will have reached stages of development and maturity and they will operate in a diverse range of sectors.  As a result, the accountancy firm will be picking up useful insights which may well be relevant to the issues you’re facing in your own business.

Let’s face it. As busy manager or owner, you often don’t have the time to sit back and reflect on the priorities and future direction of your business. It’s great to have some impartial advice and someone who can act as a sounding board. Your bank is one option, of course, but very often the relationship will be transactional and you’ll end up discussing your overdraft facility.

When you first set up a business, an accountant may be one of the first people you speak to. And right from the start of the relationship, they’re likely to be going beyond the figures and giving you advice. When an individual chooses whether they should become a sole trader or incorporate as a limited company, for instance, it’s not only a question of the tax differential. Simplicity and flexibility might be just as important in determining the decision as the bottom line.

As the business develops, you’ll start confronting a whole range of other issues. Employment law, commercial questions, IT provision and the raising of finance. While your accountant may not be an expert in any one of these areas, they are an excellent first port of call, as the chances are they will have useful contacts and be able to make recommendations.

Next time: how your accountant can challenge you and help you prepare for the future.

DNG Dove Naish
www.dngca.com
Twitter: @dng_ca
Facebook: DNGDoveNaish