Accounting for Small Businesses-Myths Clarified

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By: Subash Ghimire

When we talk about paying for the service of a professional accountant to look after the accounting and financial matters of a business, there are common misconceptions that the small business owners fall victim of. Some common myths about hiring an accountancy firm and their explanation is presented below.

  • Myth 1- Accountants are not for Smaller Business-A common man’s thinking is that only a large scale business should have a professional accountant because they charge huge fees. This might be correct if you plan to hire Big 4 firms for an off licence shop, but a large number of equally qualified and experienced accountants are available now a days who charge unbelievable low fees. This is because some of them can minimize cost by working from home, some have market penetration strategy with low fees etc. So, even if your business is a small shop or a multi million pound company, matching level of accountants are always there. You can try this by searching in Google for a minute, you will find accountants for your company starting from price as low as £50 a month (depending upon your volume and size of business)
  • Myth 2- Accountants’ cost far outweigh the benefits- Normal belief of the small business owner is that, accountants add little value to the company while charge higher fees, so it’s simply not worth hiring them. But the businessmen never account for the fines, penalties, mental stress and all other administrative and compliance hassle which they have to deal on daily basis with Companies House, HMRC and other regulatory bodies. Accountants can eliminate those hassles completely and save you cost as well as leave you free from routine work to expand your business.
  • Myth 3-Accounting is just record keeping which I can do myself-Another rather dangerous myth is the overconfidence in small business owners to underestimate the accountancy profession as a whole. They thing they are as good as professional accountants because accounting is nothing more than proper recording of invoices, keeping track of transactions etc. They might not even realize this is not true until they get a penalty notice for missing a compliance, or investigation notice for errors in return and many other complications. Ultimately, they have to hire the service of  professional to sort out those issues and additional cost of course. So, earlier they get rid of this myth better it is for the business and themselves.

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