Chartered Accountants & Business Advisory

ACCOUNTING FOR ENTREPRENEURS

Woman at the office working with a laptop

Starting a new business is an exciting time for any entrepreneur. Filled with enthusiasm and determination to succeed, it’s easy to jump straight in and make many crucial decisions before taking the time to think about the long-term implications.

Partnering with a professional accountant and business advisor from the beginning can help make sure that you lay a strong foundation. One that can support you through periods of commercial growth while creating a sustainable, future-proofed business model.

Here at Alliance Accounting, we have the experience and expertise to help guide entrepreneurs on their path to success. Theo Karabetsos discusses some of the key challenges faced by business owners and how we can help overcome them.

Cash flow graph written on blackboard

Managing cash flow

One of the most critical parts of a small business is managing cash flow. Without it, businesses are destined to be forever chasing their tails and entrepreneur business owners funding expenses out of their own pockets. Theo explains,

“Cash flow is incredibly important. If a business experiences rapid growth and doesn’t have a plan or proper procedures in place, it can have a detrimental effect.

It could be that you are doing all this work and have expenses to pay, but money isn’t coming through the door.

You might have payment terms with your debtors where they pay after 30 or 60 days, but in the meantime, you have wages, rent, insurance and utility bills due… there can be a lot of expenses that require payment and you might have to put your own money towards them. It can be a vicious cycle that you fall into where the funds are never there when you need them.”

While many entrepreneurs start their new ventures with their own finances, ideally a business should be able to sustain itself as well as provide a wage to the business owner. Accurate cash flow management is essential and our team of chartered accountants can help you take control of this important accounting task.

Restaurant owner checking monthly reports on a tablet

Business vs personal

Another key point that we focus on when providing accounting services for entrepreneurs is the differentiation between business and personal.

As we mentioned, you might have used your own funds to start your business… but it’s imperative that once you are up and running, you keep your accounts separate.

It might seem like common sense – the business account is for the business, but sometimes you can blur the lines. For example, you start to use the company’s registered vehicle for personal use or you buy groceries with the company card.

Making sure finances remain separated allows for more accurate reporting and makes it easier to identify if there are any issues on the horizon. Theo says,

“Part of the service we provide includes analysing the business financials. We bring knowledge and understanding of industry norms and we can advise if you are spending too much in the wrong area of the business.

We help you work out how to reallocate funding to be more efficient… we review what you are owed but also know what your upcoming expenses are to determine your net position. This insight is invaluable to business owners.”

Calculator and financial report

Implement processes

Internal accounting processes play a critical role in the day-to-day operations of any business. For many entrepreneurs, budgets, tax obligations, cash flow and payroll can be daunting tasks, but as Theo explains, this is where Alliance Accounting excels.

“We regularly set up budgets for our clients. Budgets are very important because you need to have visibility… to know where your next expense is coming from.

We also help with software recommendations. Using systems like Xero, you can track your cash flow and net expenses… plus you can access reports to historically view where you’ve been.

The processes we implement can help alleviate some of the stress related to budgeting, taxation obligations and meeting all relevant compliance requirements. We also have an extensive network of complementary services providers and can make introductions when you need something that falls outside our range of expertise.”

Alliance Accounting Team

We can help

“A lot of clients have started from scratch. They’ve come to us with no cash flow and concerned with how they will move forward… but they have grown into highly successful, sustainable businesses.”

Here at Alliance Accounting, we have decades of experience in business accounting and advisory services.

We are passionate about your success and are ready to help you take the next step in your business development. If you’d like to find out more about how we can help, please contact us today.