Many small businesses die an unnatural death before they get a chance to flourish. There could be many reasons for this, but in most cases, it is poor financial management. It is advisable to take the help of a professional expert if you are planning to set up your business. A chartered accountant (CA) firm has experts who guide you in setting a new business.
Role of a Chartered Accountant Firm in Your New Business
You may feel hesitant in sharing the smallest and most intricate details of your business with an outsider, but hiring a chartered accountant can help you in achieving your goals and taking your new business to success. These are some of the reasons why you should hire a chartered accountant firm before you set up your business:
- Writing a Business Plan
While writing your business plan, if you involve a CA, he will indicate financial projections and can also add other relevant reports to it. It will help you to create a realistic, achievable, and professional plan with the possibility of success.
- Taking on a Franchise
Taking on a franchise is rapidly becoming a popular method of starting a new business. Franchise contracts vary from one to the other, and so does the amount that you pay and keep. Your CA can look through these contracts and help you to estimate the profit you are likely to make.
- Buying a business
If you are planning to turn into a business person by acquiring an already established business, you should always consult an accountant. He can analyze the financial condition of the company by looking into its assets and liabilities and can inform you about its viability.
- Application for a business loan or overdraft
Experts at the chartered accountant firm can help improve your chances of getting a business loan or an overdraft. Your CA can present your application with proper facts and figures and can answer any query that your bank might have. These experts can also advise you about the type of loan you should select. They can also decide on the terms of the loan.
- Deciding the company’s legal structure
There are different types of business structures, like proprietors, sole traders, limited companies, corporations, etc. A chartered accountant can advise and explain to you the legal structure that best suits your business.
- Startup Registration
All new businesses and startups must register with the Registrar of Companies. It includes filling up many forms and sharing information with the Ministry of Corporate Affairs to legitimately start your business. A CA can help you with this registration process. If your new business is a Private Limited Company, the registration process requires other documents like Article of Association or Memorandum of Association. If it is a Partnership venture, you need the Partnership deed. A chartered accountant can expertly prepare these documents for you and help you in the registration process.
- Hiring employee
A CA’s role is crucial when you start hiring. You will have to look into salary provisions, taxation policies, labor laws, etc. Your chartered accountant will guide you to understand the different salary payable methods, ways to save income tax legally, and any related issues.
- Accounting and financial support
Along with the registration of the company, your new business also requires proper accounting mechanisms and other financial assistance. A chartered accountant can help you to manage your organization’s cash flows, shareholdings, business projections, and account statements. It is necessary to follow the standard accounting procedures and to maintain debit and credit systems intact. A CA can guide you regarding this and manage your account book properly. Your CA knows your profit and losses and accordingly carries out annual tax filling
- Maximize your tax savings
A CA firm has experts who can identify the potential schemes for tax saving and can advise you about the strategic planning for year-end deductions. They also help you with items like out-of-pocket expenses, depreciation, and home office space during tax calculation.
There are many good reasons for hiring a chartered accountant firm before you set up your business as these experts will guide you smoothly through the turbulent business environment and will make your life easier at each step.