• Menu
  • Skip to right header navigation
  • Skip to main content
  • Skip to secondary navigation
  • Skip to primary sidebar
  • Skip to footer

Before Header

Client Portal            |

Call us today for help! (615) 727-2295

Evan Hutcheson CPA LLC logo

Nashville Cpa

  • Home
  • About
  • Services
    • Tax Preparation Services
    • Bookkeeping Services
    • Payroll Services
    • Virtual CPA Services
    • Escape the Rat Race with Confidence and your Business Intact
  • Testimonials
  • Contact Me
  • Blog
  • Tutorials
  • Home
  • About
  • Services
    • Tax Preparation Services
    • Bookkeeping Services
    • Payroll Services
    • Virtual CPA Services
    • Escape the Rat Race with Confidence and your Business Intact
  • Testimonials
  • Contact Me
  • Blog
  • Tutorials
  • Home
  • About
  • Services
  • Testimonials
  • Contact Me
  • Blog
  • Tutorials

CPA Pro Tip: Your Accounting Information Is Crucial to Your Business

March 21, 2022 //  by Contributor

If you own a small business in Nashville or are planning to start one, consider hiring a CPA to help set up your company and your accounting system. Don’t make the mistake of taking accounting and bookkeeping for granted. You may not see their importance until tax season, but they can actually be more valuable than you think. In fact, accounting information plays an important role in making decisions that could make or break your business.

Ask a CPA About the Importance of Accounting Records to Your Business

Here are some of the reasons why you should keep your accounting information accurate and updated.

1. To help you set your budget

Can you afford to hire additional employees? Should you buy new equipment? Will spending more on marketing bring you bigger profits?

Knowing where best to put your money can help you maximize your profits and streamline your expenses. Your accounting reports, such as your Profit and Loss Statement, Accounts Payable, Accounts Receivable and others will help you see the bigger picture of how money goes in and out of your business. You can identify where you may be spending too much or too little on, and make the necessary adjustments.

2. To bring in new investors

If you’re looking to bring in new investors to your business, you need to present them with the necessary accounting reports that show your business’s financial health. These include your income statements, balance sheets, cash flow analysis, and so on. Potential investors will review your accounting information to know the value of your business and to do a credit analysis. They can make projections on future profitability and weigh how much risk they may be exposing themselves to if they put money or resources on your company.

3. To secure a loan

If you need to take out a loan to infuse new money into your business or to fund a purchase or investment, banks and lenders will ask you for your financial and accounting records, such as your income statement, cash flow analysis, balance sheets, tax returns, and others. Using your accounting information, lenders will assess your creditworthiness to determine whether to grant you a loan, and on what terms and interest rate.

4. To assess your financial performance

Appearances can be deceiving. Business may be brisk and your store or restaurant may have a steady stream of customers. But whether you are hitting your profit targets or are making any profit at all can only be seen through your accounting information. Perhaps your manufacturing or overhead costs are higher than your original calculations, and this could be pulling your profitability down. Or perhaps you’re spending too much on advertising and promotions. A review of your financial reports can give you an accurate assessment of where your business stands and allow you to come up with any needed solutions to put you back on track.

Your CPA’s services are invaluable not only in keeping your books accurate but also in analyzing your financial records so you can overcome any obstacles and find the right path to success.

Sources:

Quarterly Growth for Business Formation in TN Up for 10th Straight Year, WKRN.com
The Importance of Keeping Receipts, WellyBox.com

Share this:

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Tumblr (Opens in new window)

Related

Category: Nashville CPATag: Nashville CPA

Previous Post: «How an Accounting Firm Can Help You Start a Business the Right Way Business Formation Essentials Your Accounting Firm Can Assist You With
Next Post: Ask Your CPA: Is a Merger with Another Business the Best Way Forward? Get Guidance from Your CPA Before Entering a Merger Agreement»

Primary Sidebar

Article Categories

15 of the Most Overlooked Tax Deductions Click the button to get your free guide to commonly overlooked tax deductions.

QuickBooks ProAdvisor

QuickBooks Certified Pro Advisor

FUTRLI Certified Advisor

FUTRLI  Partners: Certified Advisor

Footer

Contact Information

Evan Hutcheson, CPA, LLC
5741 Knob Road
Nashville, TN 37209
Phone: 615-727-2295
Fax: 615-285-8188
email: evan@evanhcpa.com
Hours: 8 a.m. to 6 p.m. Mon~Fri
URL of Map

Follow Me

  • Facebook
  • Twitter
  • LinkedIn
  • Instagram
  • YouTube
  • Pinterest

Proud Member of:

Tennessee Society of CPAs
Construction Financial Management Association
Thriveal CPA Network

Location

Click to open a larger map

  • Home
  • About
  • Services
  • Testimonials
  • Contact Me
  • Blog
  • Tutorials

Privacy Policy · Disclaimer · Terms of Use · DMCA Notice
Copyright © 2022 · Evan Hutcheson, CPA, LLC

 

Loading Comments...