IMPORTANCE OF HAVING A PROFESSIONAL ACCOUNTANT

Starting a business is no small task, and to keep the business afloat is even harder. For this reason, you would expect that entrepreneurs will make getting a professional accountant paramount, but alas, that is not always the case. My years of experience have shown that a lot of entrepreneurs do not consider having a professional accountant handle their books and financials until the business runs into a ditch. Just as a midwife is very important to a pregnant woman, so also is a professional accountant very key to an entrepreneur who is to birth a business, and even more important is the need for such a professional accountant throughout the years of the company, except you intend to run the business for just a year or so.

Every business owner is concerned about profitability i.e. whether or not the business is making profit. And to a typical entrepreneur, in his mind, profit is the difference between how much i earn from sales of my products and how much i expend in making such products. To them it is just as simple as ABC. Even a toddler can do the maths. But often times, in a world filled with intricacies of doing business, measuring your profitability can turn too difficult, that is if the business is even making profit in the first place.  Profitability is a function of so many factors that you cannot possibly handle yourself. Chief among these is managing your operations. You need to keep operations in check; cost control and budgeting. In business, spending without a budget is dangerous. Sooner or later, you may crash. Every penny spent in a business should be planned for and monitored. Couples plan way before marriage on how many kids they are going to have. The same logic cannot be more appreciated than in business. How many divisions am i going to have? How many units are we to produce to break-even? How do we manage costs of raw materials, labour and overhead? Let me tell you this, A LOT OF BUSINESSES FAIL NOT BECAUSE THEY LACK INNOVATIVE IDEAS AND BEAUTIFUL BUSINESS VALUE BUT BECAUSE OF EXCESSIVE OVERHEAD COSTS WHICH ARE NOT ATTENDED TO. 

Budgeting, cost control and cost reduction, operation optimization and a lot more are concepts that should effectively guide the operations of any business. There is a proverb that he who fails to plan, plans to fail. Without budgeting, there is no threshold to measure your performance against. You cannot tell whether you are succeeding or you are failing. And it is so saddening that a lot of businesses are in this mess. There is the fund, there is the beautiful idea, the concept is great but OPERATIONS is going awfully wrong. A business does not run on auto pilot. It has to be piloted day and night to attain its objectives. And what better co-pilot would you have, if not a sound professional accountant. 

I believe you have learnt from this article. Looking forward to your comments. 

Written by: Abayomi Samuel