Davao Accounting Firm Advice: Basic Accounting Skills Can Plot Startup Success
According to Plato, “the beginning is always the most important part of the work.” True enough, startups should dedicate a lot of time in that period in their business life where everything is still being set up.
The plans, the business model, legal documents and marketing strategies, everything has to be accounted for. And Plato is still echoing right for centuries. What else shouldn’t you leave behind? Accounting.
It plays a central role in any business because it serves a well rounded function that if otherwise not present would mean bad business.
Do you need to rely on Davao accounting firms? You could; if the going gets tight. But the beginning phase is also a time for you to discover what you are capable of and not. And since accounting is vital, you need at least some basic skills in it before finally hiring someone to take care of it.
Why is Basic Knowledge of Accounting Important?
– It gets you off trouble. Some executives may get it wrong when it comes to financial decisions. Having basic understanding of legal accounting practices will save you all the ordeal in the future.
– It helps make informed decisions. When you’re set to purchase new equipment, knowledge of accounting will tell you that you shouldn’t outright buy what is easily accessible. It will tell you how to have an informed decision taking account all possible scenarios like age of equipment, brand, price and so on, so forth.
– It helps maintain financial health. Your business needs close monitoring of anything related to cash and having, even basic skills on accounting will prepare you for the worst of decisions when it comes to money matter, especially debt.
– It strengthens your borrowing power. Once you’re able to track your company’s comprehensive and correct financial record, it can be glossed over by many lending company and your loan for expansion be approved right away.
– You’d counter bogus information. If you have basic accounting skills, no matter how good looking the financial report looks like, you’d find out if something’s factual or fabricated.
6 Basic Accounting Skills
Are you getting convinced that basic accounting skills are so necessary to operate a successful startup? Get some accounting principles for dummy guide and brace yourself for some skills you need to focus on to start a do it yourself accounting strategy:
- Fundamental – Although this one’s taught to accountants while they’re still at the university, having a basic understanding of how accountants work when in business is advantageous. Accounting is a very time-pressured job since there will always be looming deadlines and different people to connect to. Having a sense of how to deal with coworkers, team leaders, and every employee can be beneficial to understanding how every deadline is met without going over it.
- Accounting equations – Also called technical skills. You have to at least grasp this basic equation: Assets = Liabilities + Shareholders’ Equity. This is what is usually found in bookkeeping journal entries and its number one use is to detect unusual entries on records or mistakes.
- Terminology savvy – Do you know the meaning behind the terms debit, credit, ledgers or internal controls. Once you have your own accounting department fully working, it is always good to check what they’ve been doing every now and then. If you don’t know these terms, you’d just look a total innocent kitten and in the end, you will not be able to counter-check what they’re doing. It is nice to purchase some self-help books for enrichment.
- Analytical skills – Every accountant needs this skill-set but that doesn’t mean they are the only ones who does. As the boss, it is important to be critical of whatever is involved in your financial dealings. This means that you must at least have a solid foundation on mathematics so you can see where computations are going, make sense of forecast growth or balance sheets.
- Interpretative skills – Accounting is not all about computation, it also needs interpretation. Numbers may tell you something but it needs a couple of words to make sense to everyone who may not understand. Although reporting is generally an accountant or Davao accounting firm’s job, you can end up being fooled if you just listen without having the knowledge of what they’re telling.
- Software savvy – It’s 2013 and majority of firms rely on the internet to survive. This must also be true to your budding company. And alongside this advancement is the heavy use of accounting software. One, it’s portable, cheaper, easy to understand after some tutorials and would save you time dealing with accounting professionals year round. And basic accounting skills will save you all these hassle since you have a little background; it won’t feel like working with hieroglyphics once you’ve encountered that software.
When can an Accounting Firm in Davao Intervene?
As a new entrepreneur, it will always enter your mind that as long as you can do it on your own resources and knowledge, you’d evade the possibility of outsourcing help at all cost. But this isn’t always the case.
– They can take care of the small details. Like bookkeeping services for daily transactions and keeping receipts.
– And the big ones. Financial forecasts and saving up on some valuable money.
– Save you the hassle of wrangled taxations. Since some accountants are expert at taxation law, you can be rest assured that you won’t get fines.
If you’re really serious about your company’s plotted success then it would mean so much more if you put your everything while it’s still in the initial stages of developing. Keep it healthy and thriving then remember Plato’s words for some inspiration.