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What are the Aspects to Check while Hiring an Accountant?

Accounting is one of the most important and vital tasks in the business. When you are busy running your business, it is important to take care of your finances as well. Studies have shown that a good company is the one which maintains its financial information up-to-date. This not just involves around the regular bookkeeping – it also involves regular paying of taxes, profit loss statements and calculation, future business predications and forecast and last but not the least, growing business model.

The person who maintains all the financial information of the company is called an accountant. The job of an accountant is not just to maintain the money statements. It is much more than that. Read on to find out more about the duties of an accountant and why your business needs one:

1. Business model: A profitable company is one which has a good business model. The business model helps the company to get focus and grow further. An accountant ( ActaeonConsulting/accounting-services-rosewell ) will help the company during the preparation of the business model. He/she will have an overall big picture of the financial statements and conditions of the organization. You can use the expertise of an accountant in obtaining a strong business model for your organization.

2. Budget and predictions: It is important to have business finance predictions at the start of the year. It is also important to have a budget and work according to the same. An accountant would be of help in providing such budget and financial predictions for the year.

3. Bookkeeping: This is one of the primary responsibilities of an accountant. An accountant would take care of the daily bookkeeping. Apart from this, he could also take care of recoding the regular cash flows, profit-loss statements and other financial ( ActaeonConsulting/services ) information of the company. Provident fund transactions, VAT services, Income tax management and regular petty cash flows are all managed efficiently by an accountant.

4. Performance oriented: Regular and effective bookkeeping produces a large amount of data throughout the year. This data can be used to understand the performance of the company. An accountant could use all this data and understand the current performance of the organization and provide feedback to make the company move in the direction it is supposed to.

5. Academia: The role of the accountant is a very ethical one. Since they are dealing with the most important finances of the company, they have a moral responsibility towards the assets and liabilities of the company. Any compromise on the ethical aspect of the accountant would have long fringing ripple effect on the company. Hence an accountant has a very high responsibility. An accountant not just takes care of all this, but also grooms the juniors and related employees about the skills and ethics required for this job.

To do all this work for you and your company, you could either hire a full-time in-house accountant, or you could outsource this job. This depends on the size of your business and the type of finances that you are dealing with.

What are the types of accounting?

Whether you are running a small business or a huge one, you would still require to manage your finances well. For this you could either hire an in-house accountant who would work on your finances throughout the year, or you could hire an accounting service. To know what you could expect from your accounting services in Alpharetta ( https://actaeonconsulting.com/accountingin-alpharetta ), you should first know what the different aspects of accounting are:

1. Financial accounting: This type of accounting primarily focuses on the financial data of the organization. This includes your regular cash statements and the required data that is useful to run your business on a day to day basis. This type of accounting also produces past result oriented reports which could be used for future financial predictions of the company.

2. Management accounting: This type of accounting focuses on understanding and analyzing the reports provided. The data that is provided by the past reports is turned into graphs and charts. This data is further used to analyze the business trends and make management financial decisions. This also takes into account the budgeting of the resources of the company.

3. Audit: This is one another important part of financing. This is the process of verification of the assertions made in the financial statements. The fairness of the financial statements would determine the financial status of the company and helps in the ethical long run of the business. It also makes sure that your company accounts are following the general GAAP (general accounting acceptable principles).

4. Tax accounting: Another important part of the business is to pay your taxes regularly and correctly. This part comes under tax accounting where in an accountant would precisely estimate the amount of taxes that is to be borne by your organization. It is important to pay the taxes regularly so that you make your company is statutory compliant at all times.

Now that you know what the different aspects of accounting in Alpharetta are, you could make a decision if you would need an external accounting service to take care of your finances. This is nothing but outsourcing of your finances to a trust worthy partner. This partner would take care of your financial accounting, management accounting and also the audit.

However, if you decide to go for hiring an external agency, these are some of the key points that you need to note down:

1. Credibility: Make sure that the accounting services that you plan to hire is legally registered. The service agencies make sure that they do a thorough back ground verification of the accountants they hire. This will make sure that your financial information is the right hands and you can concentrate on running your core business.

2. Technology: Keeping your finances up to date, means using the latest gadgets and software that are available to make sure that nothing is missing. The accounting services ( https://actaeonconsulting.com/services ) that you hire should make use of the latest software available in the market and this would help in keeping all the financial information up to date.

What to Look for in Accounting Firms

There are a ton of benefits that come along with the services of an accountant. In fact, while many business owners think that they can handle all of their finances in house or on their own, it often times ends up being too overwhelming to handle all alone without the right expertise. All business owners should hire accounting firms to take the headache off the plate of the business, so that the business owner can focus all of the company’s attention on one thing: the business. Professional accountants will be able to keep your financial records straight, make tax return time simple and easy, and many times can even advise you on ways to increase profits, as well as different ways to save on money. The accounting firm can point to the areas able to decrease spending, and optimize revenue. The money and time saved by hiring someone to handle all of your business finances completely outweighs the amount of money spent to bring them in and keep them on. Accounting firms are a huge asset to any business, but you still need to know how to find the right accounting company for you.

The best place to start when looking for accounting firms is to ask people you know, especially others that are in the same type of business. References from others is a great way to get a good idea of the quality of service the firm provides to its clientele.

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Whether you are looking into accounting firms that you have heard about from a friend or acquaintance, you are looking at companies that you have found online, you need to take the time to look at their credentials. It’s always a good idea to look at the schooling their accountants have completed, as well as licenses the company holds. These contribute to the reputation of the firm, and typically can increase your chances of getting better service. While this background does not always guarantee top notch effectiveness in their work, it does give you a good place to start.

Finally, before you make any decisions or enter into any contracts with accounting firms, you want to schedule meetings with them to make your final decision. This is a vital step to choosing someone to handle all of your business finances. The fact that you are going to be allowing someone else to start handling your business’ livelihood gives you the motivation to make sure that they meet all the requirements you have. Plus you need to know you feel very comfortable and at ease with them before handing them your business information.

There are times that business owners try to take on all of their financial records and business planning alone. This can be a big mistake for your business because a small mistake can become quite costly. Accounting firms offer professional advice, record keeping, and knowledge on tax laws that are extremely vital to the success of your business. The type of accounting firm you choose to hire is equally important to the bottom line.

This article was written by Maryln Kolen, on behalf of RBZ, specializing in accounting, tax and consulting services. To know about some of the common accounting errors, you may also visit About.com.

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Accrual Vs Cash Accounting for Law Firms.

When it comes to accounting for law firms, at the beginning of a law firm's life, a decision has to be made whether to report financial transactions to the IRS on an “accrual” or “cash” basis. Regardless of the choice decided upon for this important election, it's imperative that the leaders of law firms understand the difference between the two methods.

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Accounting for law Firms the Accrual Method

Generally, law firms acknowledge the firms income for the purposes of paying taxes when service invoices are sent out to the client via mail, or email. As well, law firms generally acknowledge expenses when they receive the invoices from their vendors.

Accounting for law Firms – the Cash Method

When law firms use the cash method, they usually acknowledge income once they receive a client's payment, and when payment is actually made to the vendors.

Accounting for law Firms and Paying Income Tax

Before an initial tax return is prepared for a law firm, it has to be decided which method will be used. Generally, law practices will elect to use the cash method for a number of reasons.

 By using the cash accounting method, firms can postpone recognizing payments as income from a client in its accounts receivable at the year's end.

 This method provides a law firm a lot more flexibility for planning at the year's end.

 Law firms can choose whether to accelerate invoices, or payments, so they can increase their tax-deductible expenses for a certain year.

 Firms can delay client invoices to move ahead related taxation and collections until another year.

 Numerous expenses stay as deductibles, even when they aren't paid out by the year's end. These include retirement obligations, payroll trust fund taxes and pensions. On the other hand, there are some disbursements that aren't tax deductible in the year they're paid.

Accrual Accounting for law Firms at Tax Time

When law firms use the accrual method of accounting, they usually report the firm's income for the year the services were completed, and the money was earned. This means that the intention of receiving, not actually receiving payment for the invoice is included as gross income when taxes are paid. Using this method, gross income is reported on the first of the following:

 Payment is received

 When the invoice amount is due

 When the income is earned

 When title passes

While for income tax purposes the use of the cash accounting for law firms method has many advantages, for the majority of law firms; in some cases, it can be detrimental. For example, when law practices receive large retainers, they are compelled to report this as taxable income before they render the legal services and incur expenses related to the retainer. This can create large fluctuations in the firm's net income, on a yearly basis

Accounting for law firms can be quite complicated. When a law firm is first set up, the leaders have to choose between the accrual and cash method of reporting for tax purposes. While the cash method is generally preferred, firms should always consult with an accountant, to find the best method for their law firm.

This article was written by Marcene Nutting, on behalf of RBZ, LLP, possessing the knowledge, skill, and experience necessary to quickly recognize issues and challenges that may impact your practice. To know why accountants use spreadsheets, you may visit Wiki.answers.

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