Accountants are experts in business communication and as such have significant role to play in business. The roles of accountants in small business are what I will be discussing in this article but from different perspective. You may have read a lot about the roles of accountants in small businesses but not in the same way I would be treating it here. So, I encourage you to sit back and read the remaining part of this post with rapt attention.
Financial analysis and business interpretation: as small and medium sized companies cannot afford the luxury of hiring both an accountant and a financial analyst, it then becomes obvious that the accountant will have to combine both the job of an accountant and that of a financial analyst. Businesses need to analyse business activities and carryout investment appraisal before investments are actually made.
Fraud prevention and fighting: fraud is one major cause of business failure and economic meltdown. It is the role of accountants to help small businesses put measures that will help fight fraud in place. For accountants to do this effectively, he or she needs to be well equipped with the right combination of accounting, legal and IT skills. A good professional body to join in this regard is the ACFE (the association of certified fraud examiners). You can join them today by visiting this website and register http://www.acfe.com the annual subscription fee is as at the time of this writing $35USD. Auditors also play their part in fraud fighting by giving management sound advice that will help prevent fraud from taking place.
Strategic decision making and fund raising: without strategy, businesses would definitely not strive. Strategic planning and management is no longer the sole responsibility of the top management team. It is now part of the duty of an accountant to fully participate in strategic planning, control and management of a business. Small businesses will immensely gain from the wealth of experience paraded by accountants and other finance professionals like auditors. The only problem here is that auditors are not allowed by law to render other non auditing services to their clients but, since small businesses do not really need to have their accounts audited, the advisory service of auditors can still be obtained, or better still engaging an auditing firm that is different from the company’s auditor.
Corporate governance and branding of company: brand is everything in business, remove brand and watch businesses cease to exist. Every forward looking company should jealously and carefully guard their brand. This brand is best guarded when corporate governance is given its right seat in a company’s affair. You company that lack ethic cannot successfully protect her brand. It is the duty and responsibility of the auditors and accountants to ensure that corporate governances in business are not sent to the background. Auditors can advice managers to take corrective actions that are needed to correct any weakness in controls that are already in a business or to put controls in place where there are none.
Cost savings and avoidance of legal violation: accountants are traditional known as cost savers. Cost saving is one of the primary reasons why a company keep record of transactions and carryout any form of financial analysis. Business owners may not know the best way of maximizing return from production plant but would be guided by an accountant to make the best allocation of resources. Accountants use various tools to make resource allocation decision.
There is this misconception that small businesses don’t need accountants for them to survive. This is a wrong kind of advice coming from the wrong set of advisors. I am sure that the knowledge you gained from this article has helped changed your thinking about the roles of accountants and auditors in small business. So, if you are a small business owner without accounting background or knowledge, I encourage you to go and hire one now.
To the success of your small business!