If you’re running a business your bottom line is important to you. Accounting deals with everything related to your finances, so being careful with your accounting is important to your bottom line. But how does everything fit together?
Obviously keeping good records helps you pay the correct amount of tax and avoid penalties and fees. But what else can it do? You can determine customer trends and behaviours by reviewing your accounts receivable. Uncover operations inefficiencies by reviewing your financial statements. You can keep up with industry changes through vendor costs and sales revenues. Grow your business with loans and partnerships that require thorough financial statements and understanding. All of this comes from accounting.
But before you can even get there, accounting offers some more straightforward, practical benefits. How do you decide what to price your goods and services? Accounting can find the threshold you need to clear to turn a profit. How healthy are your company’s finances? Accounting can help you determine if all your clients are paying their bills late, if you’re leaking money through interest, or determine if you’re even turning a profit. It may seem basic, but it’s the cornerstone of small business enterprises.
A good accountant will make sure you’re getting the most out of your financial practices.
