People all around the world, including Malaysia, hope that one day they can become a successful businessman. In reality, only less than 15% of the businesses success. Sadly, most entrepreneurs face a very stiff challenge where a majority of them did not get over, that is the management of finance of the company (Also see The Importance of Management Accounting).
Properly kept financial statements is an essential cornerstone for you to get the source of fund. Not only that, but the accounts prepared also enable the management to make a wise financial decision when striving to another milestone. Below are some common accounting challenges encountered by start-ups as well as exactly how accounting firms in Johor Bahru can assist businesses to overcome the challenges:
Unstable Financial Foundation
No business owner will argue that the financial resources of the company are the most critical factor they always must pay attention to. You probably need help from an accounting firm, especially when you plan to raise fund from investors to expedite the growth. With the help of a professional accountant (Also see 5 reasons to choose an online accounting service for your startup), your accounts will stay up to date and adhere to the Financial Reporting Standards. This itself build more confident amongst the investors and is a tick box you want to check.
Complying Various Rules and Regulation
Every entrepreneur wishes to stay away from government agencies’ queries. Lawyers are then an excellent option (Also see Accounting Allies You Need for Your Start-Up) to ensure the company is always staying on track. However, most start-ups have limited resources. Hence, an alternative is to seek help from an accounting firm on yearly filing or submission matters as their fees are relatively affordable. Indeed, non-company or tax-related issues going to a law firm is a wise choice despite the higher charges.
Lack of Accounting Background
This is pretty straight forward. Most business owners, whether a grocery store or gas station, is not necessarily well-versed in accounting. Lacking the relevant knowledge in accounts can jeopardise the business’ growth, especially when it is somewhat a “health bar” of a company.
Many fall into the trap of trying to do the tedious accounting work when they lack the expertise to maintain the financial records efficiently as the accounting firms do (Also see How to Choose the Perfect Accountant for Your Business). It is easy to see that more matured companies tend to save those headaches to the professional accountants as they have a more important mission to do. These firms have experienced accountant in their group, and there is no way an ordinary person can do better than them in most cases.
Most business owners thought growing their business is utmost critical (Also see How to Attract and Keep the Right Talent). To a certain degree, it is true but not to the extent that the account is neglected. There are many real-life examples where companies collapsed just because they run out of fund. Regular update of the account is the key to keeping the financial information of the company on track and therefore able to alert the management when crisis was foreseen.
There are obviously other challenges despite those mentioned above. At least for the above, you can quickly get away from them by engaging an accounting service.