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Posted on: June 16, 2022 by Huntersure
Accountants can propel small businesses by using a variety of methods and practice to help them succeed over the long haul. Creating and growing a business takes a lot of careful financial planning and oversight. Small businesses need to form relationships with accountants who can offer as much or as little help as they need. It is prevalent for accountants to play a critical role in helping businesses overcome obstacles and achieve growth.
Here are some key ways that accountants can facilitate development and enhance profitability.
What should a small business expect from an accountant? They should be able to count on their experience and competency to represent a business’ interests. Many small business owners are not well-versed in finance. Owners should understand money management fundamentals. However, they do not need to have advanced expertise in finance to succeed in their chosen field. As a practical matter, they often have to keep their primary focus on operations management. As owners handle the day-to-day logistics of running a business, they depend on help and counsel from accountants to conduct financial activities.
Clients’ reliance on accountants creates a fiduciary level of responsibility, so accountant professional liability is a critical concern in this industry. An accountant’s negligence can cause businesses to experience significant economic harm. Thus, it could lead to costly liability.
How do accountants help small businesses grow? By organizing and analyzing a business’s finances, they can help enterprises to estimate expenses that are necessary to expand their operations. They may also be able to find innovative ways to reduce overhead costs by identifying areas of concern and proposing cost-efficient alternatives. Likewise, accountants can generate substantive estimates of potential revenue.
When businesses are in a growth phase, accountants can help them mitigate risk. Also, they can make recommendations about forming relationships. Additionally, they could help them merge with other companies and forming subsidiaries. They may also offer some input on allocating capital, maintaining liquidity, securing assets, and preserving their creditors’ rights.
Problems with financial dishonesty could give rise to accountant professional liability claims. Even if the direct cause of harm to a business is a third party’s wrongdoing, failure to take appropriate measures to prevent foreseeable damage or identify questionable activity may violate an accountant’s professional duty of care.
Businesses need assistance from accountants to create audited financial statements. Auditing financial statements can be crucial in procuring lines of credit and winning confidence from private investors. When CPAs perform audits, they advise businesses on what recordkeeping practices they must follow to comply with applicable legal requirements about their business entity status and supporting documentation for taxes.
Ultimately, businesses need accountants to assess and maintain their financial health. Likewise, working with a great accountant can significantly benefit a business’s development.
Huntersure LLC is a full-service Managing General Agency that has provided insurance program administration for professional liability products to our partners across the United States since 2007. We specialize in providing insurance solutions for businesses of all sizes. Our program features can cover small firms (grossing $2.5 million annually) to large corporations (grossing $25 million annually or more). We make doing business with us easy with our breadth and depth of knowledge of E&O insurance, our proprietary underwriting system that allows for responsive quoting, binding and policy issuance and tailored products to meet the needs of your insureds. Give us a call at (855) 585-6255 or message us to learn more.
Posted in: Accountant Professional Liability Accounting