Tag: accounting firm

Top 4 Reasons All Businesses Need Year-Round Accounting Services

Thursday, April 6th, 2023

Successful small businesses don’t happen automatically. They require hard work and a lot of planning. Having excellent accounting for your small business is imperative if you want your business to be the best it can be. From bookkeeping, audits, payments, and tax services to financial statement preparation and advisory and assurance services, an accounting service delves into every part of the business the whole year round to ensure ultimate success.

Top 4 Benefits to Year-Round Accounting for Small Businesses

Although there are a myriad of advantages to having access to small business bookkeeping and accounting services throughout the entire year, four stand out as being the most important. They include:

  1. Provision of a solid record of finances – Finances don’t just happen once a year, or however often you decide you need accounting for a small business or a bookkeeper to do your small business tax, or whatever services are needed at the time; records and analysis are a year-round requirement if you want to make sure your business is healthy and moving ahead at all times. By systematically keeping track of every single transaction involved in your small business, during the whole year, you can maximize performance, help eliminate the chance of errors, and evaluate such areas as cash flow, employee performance, and so forth.
  2. Provision of business opportunities and insightful financial analysis- Whether you are seeking growth or just wanting to stay afloat, thorough analysis and realization of business opportunities are a must. It takes a healthy accounting program to do either of these feats because in-depth accounting is key to managing costs, seizing opportunities, catching directional mistakes, and improving your business cash flow. If you only employ accounting services for your small business tax at your annual tax time, you are likely losing out on information you could have gained throughout the year.
  3. Provision of optimal tax advice and services – Small business tax isn’t a once-per-year activity. You need to have information at your fingertips that will help you save money on taxes over the course of the entire year. You also need tax planning so you can maximize deductions throughout the year. By having a year-round tax service, you can be well-prepared when tax time comes.
  4. Provision of a good game plan – Business takes place all year. If you only hire an accounting firm for small businesses on occasion, you’ll miss out on the advantages having well-kept books and analogies provide the rest of the year. By the time your Enrolled Agent comes, your finances will have already changed from what they were when you could have corrected a mistake or grabbed an opportunity. Your business plan is ever-evolving and if you don’t have a professional overseeing the finances of it throughout the year, your business will not be functioning as optimally as it should be.

A Firm Decision: Hiring a Firm vs. Hiring Multiple Accountants

When your right-hand doesn’t know what your left hand is doing, it spells disaster for a small business. Even though your business likely needs multiple services, like small business taxes and day-to-day bookkeeping, if you go hiring different people from different places to tend to those duties, you may end up in trouble. Why spread it out when you can trust one firm to tend to your small business accounting, bookkeeping, taxes, and Enrolled Agent needs all in one place? Some reasons that a one-stop-accounting-shop is wise include:

  1. Consistency. You are more likely to achieve a high level of accuracy and efficiency when you have one and only one accounting firm tending to all your bookkeeping and accounting needs across the board. There’s no wondering what the “other guy” is doing when you have an experienced, expert-level agency working for you.
  2. Cost-effectiveness. When you go with one outsourced agency for all your accounting needs, you’ll get services like financial statement preparation, tax preparation, bookkeeping, analyzation of your books, and so much more for one fee.
  3. Minimizing fraud or financial misconduct threats. Having only one accounting firm to deal with lessens your risk of being cheated, fraud, or being the victim of any other type of misconduct or criminal activity. Especially when the small business accounting firm is a well-established, reputable company, you can rely on them to meet your needs without security threats.
  4. Lower risk of penalties. It’s not enough to not be aware of a law or regulation. You are still held accountable. In small business bookkeeping and accounting, there are a multitude of penalties you may encounter. By having service from one firm year-round, you lower your chances of being fined or penalized.
The Bottom Line: How It All Adds Up

The bottom line is that although you may think you are saving money by going with a small business accounting, bookkeeping or tax service only when you need them throughout the year and by hiring multiple outsources rather than one outsourced firm, the fact is that you may be costing your company dearly. It’s time to rethink your game plan, so you can come out winning.

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Income Statement and Balance Sheet: Integral to a Successful Business

Saturday, January 1st, 2022

If you want your company to succeed, you must maintain detailed financial records related to the operating of your business. Gaining a grasp on the more complicated aspects of accounting can help you garner a better understanding of your company’s finances, though hiring a professional accountant may be the most practical approach. Whether you learn as you go or hire a pro, two of the fundamental elements of business bookkeeping are your income statements and balance sheets.

Income Statements

When you want to track and analyze revenues and expenses over a period of time, an income statement offers the best glimpse. Usually, these reports are made monthly or quarterly and then integrated for yearly reports. An income statement gives a good look at a company’s performance and if you are a publicly-traded company, it is directly reported to the Securities and Exchange Commission (SEC). Income statements cover the basics: revenues, expenses, gains, and losses. From this tracking, periodic reports will show both short and long term growth, health, and future predictors for success. This information helps mold financial decisions for the next fiscal season, quarter, or year.

Balance Sheets

As important as the income statement reports is your balance sheet. Balance sheets aim to track the three fundamental areas of your business financials: assets, liabilities, and shareholder equity. Balance sheets don’t cover a range of time but rather a specific moment, which offers insight into shareholder equity at the drop of a dime. Balance sheets offer a quick view of the company assets, what is owed to other parties, and how much your shareholders have invested in you.

A balance sheet works with a formula that is used to track what your company has at any given point in time. That formulaic equation used by a balance sheet is Assets = Liabilities + Shareholder/Owner Equity.

Merging the Two

The two together- income statements and balance sheets- provide the perfect tool for gaining a look at the financial health of your business. Don’t wait for tax time or quarterly reports to run some numbers; generate reports anytime to gain perspective and see where you are going. If your company is big enough to employ analysts, they would use both reports, the income statement and balance sheet, to give you an overview of your company’s finances and offer predictions based on these reports.

Maintaining the income statement balance sheet is integral to the smooth operation- and subsequent success- of your business. Don’t have time to track your assets and liabilities? Call the professionals at BMH Accounting; they can provide you with a snapshot of your company’s financials and help you analyze data to improve daily function and overall operation.

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