India is a land of diversity. A few years ago, Taxation in India was a clear reflection of this statement. Multiple states had multiple taxes, and, therefore, conducting business in numerous states required one to be an expert in State laws and business regulations.
With the introduction of the Goods and Services Tax or GST, the complex system of taxation has made way for a simple ‘One Nation One Tax’ regime. However, with increased convenience, comes a new set of challenges – understanding the various aspects of GST, includinggst number format and GST returns, among others.
Previously, hiring an accountant was the last thing many businesses could think of, and many smaller companies did not even have an ‘Accountant’ position. Times have changed; what was before the implementation of GST a luxury is now a necessity.
This article gives you the top- 5 advantages and disadvantages of hiring an accountant.
You Get a Financial Guide
An accountant is trained to handle the various nuances of company finances. Meeting auditory requirements can get complicated without the intervention of an accountant. An accountant can set things straight by keeping your company’s balance sheet in order.
Most small businesses are capital-intensive, which means every penny they save plays a significant role in improving their balance sheets. An accountant may help you to find out areas where you may cut costs and give you tips to minimize debt if any.
By relegating the financial tasks to a trained accountant, you can focus on customer acquisition, thus saving money as well as time for business expansion.
Help You to Navigate the Murky Waters of GST
GST is new, and many businesses have little or no idea of dealing with the complex terminologies of GST. In essence, GST is easy; in execution, it is difficult. An accountant can help simplify GST to you, and you can happily assign them the task to meet the regulatory guidelines and deal with GST returns filing.
Aid Business Expansion
You want your business to grow. While designing a business growth plan or a business continuity plan, you have to pay attention to the finances. An accountant would play their part well here by giving you valuable inputs regarding the financial implications of your expansionist policies.
Provide You With Legal Support
Although dealing with legal stuff comes under the purview of the company lawyer, one of the major reasons for litigations is financial irregularities. While your lawyer can take up your case to ensure that you win, the accountant can provide the lawyer with valuable inputs to support your case.
Despite such significant advantages, there are still a few grey areas. Let us understand how hiring an accountant might be detrimental to your business.
Increases Your Expenditure
An accountant can indeed help you with every financial aspect of your business, but the service comes against a hefty fee. While you may hire an inexperienced accountant to save money, the service you get might not be worth the amount.
From a long-term perspective, however, an accountant can save you more money than you spend on them.
Shares Your Privacy
By hiring an accountant, you agree to let go of your financial privacy. However, if the accountant is trustworthy, they can compensate for the loss of your privacy by providing you with ideas that can save you a lot of money.
A Third-Party Financial Service Provider Might Cost Less
Some businesses choose to outsource their financial processes to third-party firms. Doing so allows them to save huge costs associated with the training, development, and retention of quality human resources.
The incidental costs of a third-party vendor might be less than what you have to spend on an in-house accountant.
Chances of Error
The adage ‘to err is human’ applies to any task where a human is engaged. However, these errors can seem magnified when they happen in case of financial matters. The mistakes made by accountants can be disastrous.
Spending Money on Understanding GST
A free gst wikipedia informs you everything you need to know about GST for your business. An accountant informs you of the same things but charges money for the services.
Hiring an accountant has its share of pros and cons. Carefully evaluate your requirements and financial capability before choosing one. Do proper research and read up on the benefits before committing to hiring an accountant.