Every business makes multiple transactions every day and itâ€™s virtually impossible for one to remember every detail of these financial transactions and yet they all affect the business in one way or another. Accounting provides a sole proprietor with all the information and monitors every step along which enables one to run a successful and make it grow.n
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The primary purpose of maintaining a book of accounts is to enable a person who is concerned
about knowing the financial position of business when it is needed. Every business makes
multiple business transactions every day and it's virtually impossible for one to remember every
detail of these financial transactions and yet they all affect the business in one way or another.
Accounting provides a sole proprietor with all the information and monitors every step along
which enables one to run a successful business and make it grow. Below are the services
provided by an accountant or solutions for accounting in Bridgnorth:
1. Financial position
Accounting solutions cannock helps to keep the businessman informed about the financial
position of the business as at that time. He can know every financial aspect of the business by
simply going through the accounting records. An accountant records every transaction in the
book of accounts such as the cash book, receipts and ledgers in complete and systematic records.
2. Ascertainment of profit or loss
Certified accountants offer solutions for accounting in Bridgnorth which assist a sole proprietor
to know if he/she has made a profit or loss within a certain period. For a person who solely
depends on his business for daily bread, it's important to know the amount of profit the business
has made within a specific time so that the drawings of that month that are required for personal
use does not exceed the profit. Profit is the main objective of every business and it's very
imperative that they are informed about the amount of profits received so that they know the
actions which needs to be done to attain their goals.
3. Loans for the business
Sometimes a business might need to expand or grow and this can be done by asking for financial
assistance from banks, SACCOs and other institutions. For the loan to be approved by a financier,
they will certainly ask for profitability and the worth of the business to get a clear picture.
Accounting provides clear information about the financial position and the general worth of a
business by producing evidence regarding accounting statements. Similarly, if the owner of the
business decides to sell the business or get into a partnership, the only thing that will help in
determining the value of the business is the accounting records.
By making a recording of the movement of assets in the business and every other business
transaction, it gives a businessman effective control over the business as he can monitor every
activity. Without the presence of financial records, it would be extremely difficult for the
businessman to notice theft or misappropriation of funds.
5. Tax purposes
Accounts are necessary for taxation. In the absence of proper accounting records, it would be
difficult to prove to the authorities the correct income of the business on which the business is
levied. Similarly, other taxes like sale tax and excise duty are collected by a business turnover.
It's important to ask for your accountant advice before you take any action so that they can be
able to guide you in making choices that will enable you to attain your goals.
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