Merging the Old and the New: How Davao Accounting Firms Help Company Startups and Successions
Merging the old and the new is never an easy task. New ideals are sometimes too rash that the slow-paced ones are not able to immediately cope. But becoming successful in this endeavor can entail a wonderful present; look at how Japan and China managed to bring about old traditions into the modern era – a perfect blend that truly exhibits individuality.
The same thing can be said of a company’s status in comparison to its years of existence. They have terms such as start-ups (for new ones), closing shop and succession planning (for old ones); all dependent on the variable of time.
These are definite and essential parts of any company’s timeline (beginning and transforming phases), as it can determine whether or not they can survive in the changing trends and fierce competition. Majority of industry sectors rely on financial partners to help them ease the burden of managing such a tumultuous task at these crucial moments. An accounting firm with certified public accountants can surely give any company – still forming or is already entering new management – a clear advantage when it comes to efficient management of financial situations, unlike any other.
Below are two scenarios that are important aspects of a business timeline and how accounting firms can specifically help them:
- New Business Formation
- Succession Planning
Startup Dilemmas, Solved
Reality bites: starting a business in a big and vastly diverse city such as Davao can become overwhelming for any entrepreneur. If it has been a childhood dream or a hobby, all the more challenging to attain. Aside from thinking about possible places to put it up, you also have to consider the what, when and how in the equation.
Fact: A Davao accounting firm can help you, first and foremost, in planning the initial steps toward any business formation – the registration.
In the Philippines, that is of course done by registering your chosen business name first through appropriate local authorities, such as:
- DTI (Department of Trade and Industry)
- SEC (Securities and Exchange Commission) and
- CDA (Cooperative Development Authority)
All these basing on the type of ownership: single, partnership and cooperative, respectively.
After that, you can go down the ladder and visit your Local Government Units (City Hall, Provincial Hall), the Homeowner’s association leaders, Barangay Hall and of course the BIR (Bureau of Internal Revenue) for taxation purposes. With any firm’s help, you can swiftly go through this process without much hassle.
Aside from that, they can also do the following for your convenience:
Forecast – In here, they can offer you the expert insight on things to come. This may mean that they can already sketch either a blurry or clear future for your company basing only on the facts that they can gather that is essential for any start-ups such as permits, your vision and goal plus the market value of your company among many others.
Determine capital needs – They can evaluate and quantify your borrowing power (usually done through your credit standing) so the money lent to you can be used as added capital AND create a business structure that will generally fit a company you have in mind with the actual money you have in hand.
Do budgeting – They can help you account for costs of repair for old properties, acquisition of goods (furniture, computing devices, and retail materials), building a new structure, advertising stints and hiring employees (if ever needed right away).
Execute much planning – Involved here is the budgetary cash flow planning and taxation. They can help you fix a needed budget to keep your startup alive for months to come and prepare you for tax seasons, compliance and savings come time for filing of returns.
On the Verge of Metamorphosis, Aided
Reality Bites: If there are newcomers in any industries, there will always be respected ones, or those companies that have already carved their insignia into the very heart of their niche. If your company satisfies this idea, it’s either: (a) your company is too old (20 years or more) OR (b) you are a proprietor who is already too old so you can’t anymore keep up while you age that you now have to pass the throne to someone else younger.
Fact: This is the problem of time-tested corporations – the numerous changes it has to withstand in order to survive. But since they’re durable enough, they manage to weather these detriments to their advantage thus the longevity. A reliable financial partner in the form of an accounting firm in Davao city can materialize the needed help in this dire situation.
The first key step to identifying this is by answering too many boggling questions that runs in the mind of any candidate for retirement in the top helm, like:
- Who would become next president?
- When does this transition can take place?
- How can I manage the same situation for my retiring employees?
- How can any family members become part of the company?
Your accounting firm of choice can sift through the issue as an outside party who can be fair and balanced in their view. While on that topic, they can look at six issues:
- Seniority issues (organizational structure)
- Viable leaders (those that you managed to train)
- Compensation
- Ownership and Governance
- Code of Conduct (Ethics)
- Family relationships
The understanding of these major concerns is fundamental in clearing any disputes or ethical issues that may arise upon transition. Moreover, aside from understanding, there must be an action phase and these are what they can offer you:
- Consider Future Goals – If your goal in mind is to continuously manage the operations with a real successor then you have to know that there will be changes. They can help you restructure the business according to how it can best fit the new leader while still tuning it to the over-all philosophy of the company. What’s important is that you have a goal in mind and that you have backed that up with real facts out of research and projection then you’re only bound for more years in operation.
- Consider Mergers – This can be viable option if a good succession plan wasn’t beautifully put. They can do business valuation by scrutinizing every department in your company to assess its over-all economic value for it to become saleable and ready for mergers or affiliations.
- Retirement Projections – Always plan not just for your own retirement but also that of your senior employees. In here, they can tell you how to train future leaders that may continue the heritage that your company is known for AND arrange all necessary papers and benefits for the retiring employees.
- Early Planning – Succession is not a one-time affair; it has to be nurtured daily for it to succeed once it’s carried out in reality, which means integration in daily operations. So above everything else, it is well advised for you to consult with a firm early so you can prevent failing later miserably, come time for your real retirement and own succession issues.
On a final note, the main goal for any start-ups and successions to become ultimately successful is long-term planning and integration. For a clearer delineation of very crucial tasks that need expert touch and opinion, hire accounting firms and prevent the problems before it happen; regardless of whether your company is new or old.