“Get an accountant!”
“How have you not hired an accountant yet?!”
“You need an accountant, like, ASAP.”
You’re sick of people talking to you about accountants, aren’t you?
Yes, alright, you know that you need one.
And yes, you said you’re going to hire one soon.
But the truth is…
You have no idea what an accountant is!
And what they do?
Read More: What Is An Accountant?
You haven’t been living under a rock your entire life, have you?
You have a bit of an idea of what they are…
Well, you know they have something to do with money and taxes.
But there’s a lot more to them than that.
Like how they’re actually the saving grace for most businesses!
They certainly were for our client, Lillian.
She also had limited knowledge on what exactly accountants do, so she only went and tried to hire one for the stupidest reason.
(Promise not to laugh.)
She was a self-employed Maths tutor and wanted to quiz her students. So, she hired an accountant to come up with finance based test questions for their paper!
What a #waste of time and money. And an accountant.
If she had taken 5 minutes from her day to just read this article, we could’ve saved Lillian both time and money, and set her up with an accountant that could help with her finances.
And not the quizzing kind.
Unfortunately Lillian contacted us when it was simply too late.
Did you know that she soon went out of business due to her debt problem? A problem that could’ve been fixed by an accountant?
I refuse to let you turn out like that.
The thing is, if you want to find the best accountant for your business and make sure their work doesn’t got to #waste, you need to get to grips with the basics of accounting.
So, I’m here to tell you what exactly an accountant does and why you need one…
Take a look!
You want to reduce operational costs and increase your profits, right?
Well, you can’t do that alone…
Not successfully, anyway.
If you’re taking care of your own finances, I guarantee you won’t save anywhere near as much as you could.
Sure, it might feel awesome when you manage to knock £10 off your monthly phone bill…
But you’d definitely feel this much more awesome if you had an accountant that could knock the entire bill off your annual tax return!
But it’s not always that easy.
There are 4 business scenarios that need an accountant.
Do any of these sound familiar to you?
They Have Complicated Financial Issues
Most financial problems need the attention of someone more qualified than that guy in the office who got a B in high school maths.
Though some issues won’t affect a business too much if a mistake is made…
(Like accidentally putting the wrong month on an invoice - that can be easily corrected!)
Some can be detrimental to the success of your company.
For example, if you have terrible debt - like close to bankruptcy terrible debt - you can’t ask just anyone to sort out the problem for you.
A chartered accountant will advise you how you can avoid falling into bankruptcy, and how to pull yourself out of the pit if you do happen to fall into it.
You Hold Sensitive Financial Information
All businesses hold information that absolutely should not be shared.
Passwords. Customer contact information. Bank details.
You don’t want those digits getting out, do you?
No one wants a lawsuit on their hands!
Another client of mine stumbled into this trap. And just like Lillian, bankruptcy was on the cards, too.
I won’t go into the details - but ironically enough, that’s what the guy who got the sack did!
He used their bank information to go on a shopping spree AND he spammed former clients.
Not only did it cost them a pretty penny, their reputation was at stake, too.
Don’t want to see this in your future?
Cut out this risk altogether by hiring a qualified professional.
You Need Financial Advice
Business advice tends to sound really simple - especially when it's from people who have no idea what they are talking about..
“Just get more customers - it’s not that hard!”
“Post something on Twitter!”
“Be, like… better!”
But an accountant can give you real advice on how to increase profits.
For example, an accountant for my marketing client suggested they charge less for their graphic design services.
“Hol’ up - I’m not charging less.
Over my dead body!”
They assessed their accounts and discovered that only 10% of their clients were repeat buyers.
After a bit of persuading, they agreed...
They just tripled the number of customers.
How’s that for being better?
You’re A Complete Newbie
Not everyone is an expert in accounting.
When I was younger, I had no clue what 90% of the terminology even meant…
Let alone how to use all the complicated accountancy software out there!
But you shouldn’t get financial advice from anyone you happen to find on the street.
You want to ensure all the advice you take is not only correct, but legal too.
And the only way of making sure that happens is by hiring a qualified accountant.
You don’t want to know the number of clients that have come to me in a panic ‘cause they don’t trust their accountant.
And you also don’t want to know the number that were using “accountants” with just as many qualifications as that barista that just made you that latte.
Your accounts… duh.
No more sarcastic answers!
There’s actually a lot they can do - from preparing tax returns to conducting financial investigations.
Have a look at some of the things they’re requested to do most frequently:
Ensuring Your Business Is Operating Legally
Balancing The Books
Prepare Financial Documents
Preparing Tax Returns
Some of those tasks are fairly self-explanatory...
But some are a little more difficult to understand unless you have a background in finances yourself.
(Like little ‘ol me.)
I’ve used my awesome array of knowledge to explain the trickier terms of the trade.
(Look, I’m just so intelligent, I can’t help spreading my knowledge.)
The most important thing to take into consideration with your finances is this: how each purchase or income increase is going to affect you in the future.
If you know your office rental space will cost you £350 next month, you’re not going to suddenly buy £500 worth of non-essential equipment now, are you?
It doesn’t take a genius to work out why…
You’ll also have to ensure you take on at least 3 extra clients next month, and cut how much you’re spending on other services…
But all this panic and last-minute budgeting could be avoided if you create a solid financial plan from the start.
You know, with an accountant!
Every single person in the world could benefit from a budget meeting from a chartered accountant.
No, I mean it.
They are, like, the best tool to stop you from overspending.
Aaaaand they let you know if you have enough leftover profit in your budget each month to splurge on a non-essential item.
Like that fancy coffee machine for the office you’ve been eyeing up all month!
Ensuring Your Business Is Operating Legally
They’re not going to be sending you email reminders saying “please don’t murder anyone today.”
But they will make sure you file your tax return on time, among other things.
You could be the best business person, like, ever, but it’s too easy to make a mistake when you’re working on something long and boring.
Before you know it, you’re drifting off…
And then suddenly awake cause Susan in marketing sneezed really loudly!
You glance down at the work you were supposed to have done, and you’ve written that you earned ||$||101.22||$|| this month instead of ||$||1012.20||$||.
It might be the smallest mistake, but the tax office don’t care.
They’ll fine you, then get back to that cuppa.
With a chartered accountant on your side, the chance of this happening is almost non-existent.
Balancing The Books
At the end of the year, it’s important that your accounts are ‘balanced'.
This means that the amount you spent this year and the amount you received should be added to determine whether you made a profit or loss.
Simple enough, right?
If your bank statement shows you’ve made a ||$||3000||$|| profit, but your accountant has surmised from your books that you’ve only made a ||$||2790||$|| profit increase…
Well, there’s clearly been a mistake.
Your accountant can work out what went wrong, and recover the lost money to ensure your books are correct.
Yet again, you avoid a massive fine!
(And you didn’t have to touch a calculator, either.)
Prepare Financial Contracts
Hands up if you hate contracts.
Writing ‘em, signing ‘em…
It's such a stressful process.
Every contract you receive or send out - those related to money, that is - should be looked at by a financial expert.
They can spot from a mile off when you’re about to be ripped off - or you accidentally fill your own with loopholes that prevent your clients from paying you.
We actually had a client who once that wrote in a contract with a client that they had to pay him on June 31st.
Of course, June 31st never came - and neither did his payment.
It was a lengthy battle trying to get that money off them.
With a chartered accountant by his side, that mistake would’ve been spotted in seconds!
Preparing Tax Returns
Tax returns are one of the most important things you can do - but they are also one of the easiest things to get wrong.
People forget to file in time or make simple mathematical errors all the time.
Thousands of people every year make completely avoidable mistakes!
And mistakes cost money.
It’s still technically your fault if an issue arises with your tax return…
But there’s highly unlikely to be one if you hire an extremely qualified, chartered accountant.
This is a job you really can’t do yourself.
Because you really need an official auditor or a chartered accountant to take a look at this for you.
Once they’ve put their auditing shoes one, they’re proving that all the financial information you’ve provided is truthful and accurate, after all.
And if you don’t get a recognised official to audit your accounts, you’ll be facing serious consequences.
You can’t get anyone to do this for you.
(Even if you do want to skimp on this seriously important component of running a business.)
Who’s ready to get even more confused?
Don’t worry - I’ve broken it down best I can.
The accounting process for managers is slightly different from that of employees that aren’t in executive roles.
Where your head of social media would need advice regarding their advertising budget, managers would need advice regarding the company's entire budget.
They’re the ones who decide what to give cash and what to cut!
(With a little help from their accountant that is.)
A good accountant will lead them to make the best decisions for their business.
Never...I repeat, NEVER do your own accounts.
Unless you’re part of the 0.01% of people that open a business and have an accountancy background, it’s something that should be avoided at all costs.
One teeny-tiny mistake could result in not so teeny-tiny fines…
And even the dissolution of your company!
You don’t want that, do you?!
If you’re absolutely adamant that you want to do your own accounts - or are on a serious budget - it’s important that you stay on top of the game.
To help you out, here are my top tips to follow if you want to do your own accounts:
Don’t Make Assumptions
When it comes to finances, it’s very easy to do something just because you assume it’s right.
Especially when it comes to tax returns.
Time and time again, we’ve seen clients land themselves in hot water just by guessing what they could class as a deductible.
Just last year, one of our ex-clients - let’s call her Jennifer - almost bankrupted herself this way.
She decided that she didn’t want to pay for the accountant we found for her anymore.
She thought she’d learnt enough to do her accounts herself.
Boy, was she wrong.
Her accountant had been deducting any client lunches from her tax return as they were technically a business expense.
Silly Susan assumed that meant she could claim all meals out were a business expense.
Not only did she frequently class dinners with her husband as “meeting with potential investors"…
She told the tax office that the birthday party she threw for her co-worker was a networking event!
Needless to say, she was found out.
And the fine was immense.
I can’t tell you how much it was for legal reasons…
But I don’t think you’d want to know how many zeros she had to write on that cheque to pay her fine.
If you ARE going to be deducting random ‘expenses’ from your tax bill, it’s best to converse with a registered professional first.
Don’t Make Mistakes
That’s easier said than done.
But as long as you keep checking, you should be fine!
It’ll take you 10 minutes tops to read through your financial documents and ensure all the information you’ve provided is correct.
And a few minutes out of your day to read some paperwork is no bother anyway.
(Not compared to the hours you’d have to spend filling out forms when your company’s dissolved because you forget to note down a single payment.)
Take the time, avoid the crime.
Don’t Forget Your Due Date
It’s just one day.
One day a year that you MUST keep on top of:
When your tax return is due.
You may have other deadlines to keep on top of as well…
But this is the one that could get you in trouble.
I’ve said it before, and I’ll say it again - massive fines and the dissolution of your company will be the consequences of skipping this date.
Do you really want to pay thousands just because you were too lazy to spend a second checking your calendar?
Didn’t think so.
Try and get your tax return sent in as soon as the tax year is over.
You aren’t handing in that spanish assignment you wrote when you were 15.
You can’t email Senora Garcia to let her know it’ll be a day late…
Don’t Stop Organizing
That’s how long it would take to organize your financial documents if you did it as you went along.
That’s how long it would take if you saved the task to the end of the week.
That’s how long it will take you if you leave it to the last minute.
Plus, you’ll lose half the documents you need.
(And the stress will have you pulling out your own eyelashes in less than 10 minutes.)
If you stay on top of things as you go, by the time you actually need to actually hand over your accounts , you won’t have to do any work at all!
So, I’ve convinced you not to do your own accounts then.
But Houston, we still got a problem:
You aren’t sure you can afford an accountant!
And while it’s true that you can’t get a good accountant for under £10 an hour...
(Yep - I’ve really been asked that before.)
There are a number of things you can do to keep the cost of your accountant down.
Let's take a look:
It’s the digital age.
People don’t need to work for companies to get paid a fair wage anymore.
You can do practically any job from the comfort of your own home!
So, why fork out for a firm you can’t afford?
Especially when a handful of employees from the same firm could be moonlighting as a virtual accountant as a side hustle…
It’s the same work for a reduced price!
Use sites like Fiverr to seek out top quality accountants at discount prices.
Just make sure you research each profile first and check their reviews to make sure they’re legit.
Go For A Package
This is what I suggest to my clients when they consider any kind of accountant. You can see if you even need one and the tasks you need to outsource!
If you know you’re going to need an accountant for more than an hour, definitely look into the package deals most firms have on offer to you.
Though you may initially be paying a more expensive fee than what you planned, the average price per hour lowers quite significantly.
“So they’ll get more work done for way less money?”
You got it!
Doesn’t sound so bad after all, does it?
Everything’s cheaper off-peak.
Trains tickets to London Bridge, hotel rooms in Paris, and flights to Barcelona.
Guess what’s just as glamorous off-peak?
Guess when their quiet season is…
The minute all tax returns have been filed, their income drops quicker than a ton of bricks.
Obviously, they’re gutted when this happens.
They still have to pay their bills in the off-season after all!
So, if you ask nicely, they’re much more likely to help you at a reduced price.
They get a decent amount of money in an otherwise slow season; you get a good accountant for a low price.
Do Your Own Bookkeeping
Despite what the majority of people may think, bookkeepers and accountants aren’t the same thing.
A bookkeeper records information - an accountant helps you understand it.
Unfortunately, bookkeeping services are rarely included in your finance package.
It’s usually billed as an optional extra.
Well, if you’re lucky enough to find an accountant that offers it at all!
But, do you really need to?
Not at all.
You can actually do your own bookkeeping - and do it easily, too.
It’s a super simple thing to do…
You’ve just got to keep an organized record of all your financial transactions!
Imagine you’re at the hairdressers for a minute.
Why pay £25 for a hair wash before your cut?
It’s extra work for your hairdresser and it’s wasted money for you.
Wash it before to save time, help out your hairdresser, and lower your expenditure.
Then apply the same process to your finances - your accountant will thank you!
(Don’t forget to rinse and repeat.)
Finding the perfect accountant that actually fits into your price range can be a long and difficult process…
But here at QuoteGrab, we are on a mission to change that.
After we collect a little bit of information about you, we start the hunt right away.
In minutes, we can find up to four of the best quotes - that all fit into your budget!
Just sit back, relax, and feel your finances fix themselves.
How Do I Spot A Bad Accountant?
There are some obvious telltale signs of a bad accountant.
Like terrible client testimonials and 1 star reviews...
But there are a few things that clients aren’t always aware of. And they totally should be!
For example, the best accountants are always chartered.
(This means they’re professionally trained, have plenty of experience, and a whole host of qualifications that you probably don’t care to hear about.)
Though not all unchartered accountants are necessarily bad news, I wouldn’t suggest using one unless the tasks you need completing are low-risk and non-essential.
“Oh, wow, look at that bargain!”
Don’t click ‘hire’!
If the accountant you like the look of is charging a bizarre price, they’re going to give you a bizarre service.
And by that I mean they might not be legitimate.
If they’re charging too much or too little, they clearly don’t understand monetary value as much as they claim to.
You can’t really be a financial expert if you know nothing about finances!
So, take a look at the average cost for accountants in your region, and don’t stray too far from that price.
Where Can I Find An Accountant?
Accountants are actually some of the easiest people to find.
There was probably one sitting next to you on the train this morning.
(Although I wouldn’t suggest whipping out a contract and asking them to sort out your finances whilst their trying to get off at their stop.)
You can also use a simple Google search to find accountants in your area.
Or use sites like Upwork to source freelance accountants!
Failing that, you could always come to us for help.
We can find top accountants for you in minutes!
Can I Hire An Accountant To Help With My Tax Return Only?
You can actually hire an accountant on a task by task - or an hourly - basis.
It’s a lot more affordable if you know you’re only going to need them once per year.
It’s an extremely easy service to find if you’re using a virtual accountant.
But if you prefer one you can physically meet with…
Just ask if you can pay by task!
Can I Get An Accountant If I’ve Just Started A Business?
Whether you’re a veteran business owner or complete newbie…
There’s no wrong time to hire an accountant!
In fact, the earlier you bring one in, the more likely your business is to succeed.
Also, if you inform them you’re a new business, they may even offer you a discount to help you out!
Did you know that whenever I get a new client, I find them an accountant first?
Just last week I had a tech start-up blowin’ up my inbox, asking for advice on VoIP telephones.
“Sorry guys - wrong expert!
But before I forward this email to Daniel - our VoIP expert - you do have an accountant, right?”
How Often Do I Need To See My Accountant?
As much as you want!
Okay, maybe not at 2am.
(Please don’t wait outside anyone’s house in the middle of the night.)
There’s really no right or wrong answer here - you can see them as often as you like.
But generally, most clients choose to see them around once a year.
(Around the terrifying time that is tax season.)
It all depends on the project though.
If it’s something quite hands-on, I’d suggest meeting up with them at least once every 3 months!
Well - here we are.
That is everything - and I mean everything - you need to know about what accountants do.
But why stop there?
Why not take it one step further and actually hire one?
It’ll be the best thing you ever do for your business - I promise.