There’s so much to think about when running a family business and you can’t do it alone forever. For one thing, handling the financial side of your business is a full time job in itself and you really can’t afford to take your foot off of the gas for any length of time. Without external help, it’s all too easy to lose control of your finances and this can prove disastrous.
Many family businesses put off hiring an accountant for a later date, but in actual fact it pays to do this sooner rather than later. Your family business is most likely to fail in its early days, and during this time any unnoticed accounting or bookkeeping errors could compound and devastate your budding enterprise.
A good accountant truly is an investment in the financial health of your family business, both now and in the future. Of course, every family business owner has a unique set of needs and circumstances, so here’s how to tell if it’s time for you to hire an accountant and get back to doing what you do best.
1. You’ve Made Mistakes Before
It’s no secret that accounting isn’t exactly simple. Innocent oversights and slight miscalculations are all too easy to make, but difficult to undo if they go unnoticed for too long. If you’ve made accounting or bookkeeping errors in the past then you’ll already know just how much time and effort is required to rectify them. Furthermore, mistakes on your tax return could result in huge fines. If you’re struggling to manage your accounts and keep accurate records, then it’s definitely time to seek help before these mistakes damage the financial health of your family business or halt your growth.
2. You’re Short on Time
Running a family business is time-consuming and there are always a hundred and one issues demanding your attention. With everything else going on, it can be difficult to find time to balance the books and ensure you’re on top of your finances. However, it’s really important to do this in order to maintain accurate records for tax returns, credit applications and financial planning. If you don’t have time to look after your finances, you need to seek the help of a professional accountant who can.
3. You’ve Got an Audit Coming Up
If an audit is looming, you may be in for some sleepless nights. It’s important to make the process as smooth as possible, so your accounts and records need to be squeaky clean and perfectly organised. Otherwise, you’ll be facing a barrage of work trying to straighten things out. Furthermore, any innocent mistakes you’ve missed could result in a hefty fine. Therefore, it’s worth enlisting the help of a quality accountant who can get your affairs in order, find and fix any mistakes you’ve made and ensure that you pass your audit with flying colors. It will save you money not just in fines, but potentially in therapy fees, too.
4. Your Business is Growing (or wants to grow)
As mentioned, it’s never too early to hire the help of a professional accountant but when your business is going rapidly, it’s most definitely time to give up the DIY approach.
Rapid growth means new customers, new hires, more investment opportunities and many more demands on your time. However, this is certainly not the time to overlook your accounts. Hiring an accountant can help you to choose potential investors wisely, manage your cash flow and use your extra income wisely.
As your family business grows, new financial challenges will arise and it’s best to have an expert on hand to deal with them when they do. Growth is fantastic, but it can lead to instability and the right accountant can help to keep your family business on the path to financial success.
If your family business ticks any of the above boxes, it’s time to invest in an accountant to protect and improve the financial health of your business. Chartered accountants train for many years in order to receive their qualifications, so don’t make the mistake of thinking you can manage your small business’ accounts by yourself forever. In order to create a successful family business, you need to treat it like a proper business, and that means taking your finances seriously and investing in the financial health of your organisation.