How to Become a small business accountant: A Complete Guide

Are you considering a career in accounting? If yes, then there is good news for you. Any individual with good numeric skills, attention to detail, and money handling capacity, can become an accountant.

The term “accountant” is not legally bound, and anyone with little knowledge in accounting can call themselves an accountant. However, to work professionally, you need to select from a variety of accounting career paths and accomplish a degree, gather work experience, select an area of expertise, assemble skills, and boost your career.

Here is a brief guide on how to become a small business accountant.

Who is an accountant?

An accountant is a professional who records business transactions, reports on company performance, generates financial statements, maintains compliance, and performs other accounting tasks in a business.

Though accounting may seem like a straightforward profession where you need to crunch numbers, it involves many responsibilities that help a business grow and improve its financial health.

Responsibilities of an accountant

Listed below are some everyday responsibilities of an accountant.

• They prepare important financial reports from the data collected by the bookkeepers
• Ensure accuracy in the financial documents, and every accounting process maintains compliance with relevant laws and regulations
• Filing tax returns
• Analyze financial data to recommend the best practice, identify opportunities and risks, and help businesses run efficiently
• Provide necessary support and guidance on expense reduction, profit maximisation, revenue enhancement, etc.
• Conduct assessments for financial forecast and risk analysis

What are small businesses in the UK?

According to the UK’s companies Act 2006, is a small business is the one that-

• Doesn’t have an annual turnover of more than £6.5 million
• Balance sheet total of not more than £3.26 million, and
• The number of employees working in the company is not more than 50

Almost 99% of businesses in the UK comprise small to medium-sized enterprises and micro-businesses. It is the backbone of the UK economy.

What are the accounting needs of small businesses?

Small business accounting generally refers to identifying from a recording, analysing and interpreting financial information.

Small business accountants London can help you understand profit and loss in a year, manage your assets, liabilities and equity, and understand your company’s financial health.

Besides these, they help in;

• Budgeting and planning
• Decision making
• Analyse your business performance
• Track your expenses
• Calculate your taxes
• Set up an invoice system
• Develop a bookkeeping system
• Set up a payroll system
• Check if a business needs to register for VAT
• Maintain compliance, and
• Provide necessary advice

Benefits of a financial auditing

Auditors are generally and ultimately appointed by the shareholders and report to them directly or via the audit committee (or its equivalent) and others charged with governance. Financial auditing will, almost invariably, also identify insights about some areas where management may improve their controls or processes. In certain circumstances the auditor may be required to communicate control deficiencies to management and those charged with governance. These communications add value to the company and enhance the overall quality of business processes.

How to become an accountant?

Obtain an accounting degree

The minimum level of education of an accountant is qualifying AAT, and to get a chartered status, you need to qualify for ACCA, CIMA or AIA. A bookkeeper can hold an associate degree, but an accountant must have at least a bachelor’s degree in accounting.

Pick an accounting speciality

We can split accounting careers into two essential parts, management accounting and financial accounting; these further have several divisions. Most graduates enter the accounting profession via financial accountancy and open various career paths such as audit, business recovery and insolvency, corporate finance, forensic accounting and tax.

Gather experience

Despite gaining an academic degree, you need real-life accounting experience to establish this industry. As an accountant, you can find work in different sectors, from small and medium-sized enterprises to large companies and individuals. Gain practical knowledge and be a pro.

Be tech-savvy

In the digital era, you must be tech-savvy, as most businesses prefer automation in their accounting process. Additionally, you must learn to use pre-made consolidated P&L templates, the latest accounting software, cloud-based software, and other tools to avoid manual errors and provide faster results.

Gather soft skills

Besides having an educational degree and technical skills, you must have a few other qualities. These skills include problem-solving, attention to detail, time management, leadership, good communication skills, etc. Managing teams, dealing with clients, and managing accounting tasks efficiently.

Conclusion

Starting a profession needs time, and there is no shortcut to success. You need to spend the first few years gaining a degree and work experience and continuing to grow during your accounting career. You need to market yourself and reach prospective clients. Give your best in any work you take up because word-of-mouth has excellent power.