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Many high-profile startups have experienced success in recent years, such as Canva, Afterpay, 99 designs, and The Iconic. These success stories lead the way, inspiring many more Australians to launch startups, with Australia experiencing some of the fastest growth in startups worldwide.
Creating a new business is not easy.
“Starting a business is not for everyone. Generally, starting a business, I’d say, No. 1 is to have a high pain threshold.” Elon Musk.
Having an accountant on board is the key to success.
An accountant can take an instrumental role in alleviating the pain of starting a new business.
Things an entrepreneur will need:
1. An awesome idea
2. An awesome accountant
An awesome idea: That’s up to you!!
The budding entrepreneur has a fantastic idea and is ready to plunge into the next step and make their vision happen, and there are many things to consider. One critical consideration is the financial management of their business; poor financial management is a significant reason a new business may fail. Entrepreneurs can benefit from a financial mentor AKA an accountant, to get things right from the start.
An awesome accountant: How accountants set entrepreneurs onto the path to success
1. Choosing the right business structure
An accountant will advise on the pros and cons of a particular structure for a business and help decide the most suitable option. Choosing the right structure means balancing the cost and complexity with potential tax benefits while minimizing asset risk. It should be appropriate and meet the needs of each entity.
Some common structures are:
2. The Business plan
How accountants are helping entrepreneurs kickstart their business to success. It is essential to have a business plan that will outline its vision and strategy with short, medium, and long-term goals. A clear business plan with comprehensive financial planning may be the difference between landing finance or struggling to find the funds needed to make their vision a reality. An accountant can assist in estimating the costs of resources such as human capital, equipment, supplies, insurances, and overhead costs, which may include an analysis of purchase vs lease decisions and generating a budget. Having a firm understanding of these costs will help ascertain the amount of capital that needs to be invested to fund the venture. Many entrepreneurs will finance their venture with their personal capital or borrow money from family or friends. There are, however, several other options available. A well thought out business plan can be used as a basis to secure finance from investors and lenders such as:
3. Create robust accounting and bookkeeping systems
Accountants can support an entrepreneur by implementing accounting systems, including software, controls and procedures. This will enable the business to determine its profitability, whether they are meeting key targets and identify where performance is not as planned. The systems will provide up to date financial information that is organized and available at their fingertips. It also allows for any required legal and financial compliance reporting to be easily obtained and well prepared for tax time or applying for additional funding.
4. Registrations and licenses
For entity’s structured as a company, the accountant can also help with setting up an Australian Company Number (ACN) through ASIC. An accountant can take the hassle of setting up an ABN and register for relevant taxes such as PAYG, GST, payroll tax, and FBT through the Australian business register and ensure the appropriate trading licenses are held through the Australian Business License and Information Service (ABLIS).
5. Ongoing financial management and tax planning
Accountants provide a clear picture of a business’s financial health, enabling the entrepreneur to focus on money-making activities and the growth of their business. Accountants are instrumental in tracking revenue, keeping on top of expenses and capturing this data in financial reports. They can produce key metrics enabling analysis and interrogation of financial data. They can develop, prepare and monitor cost forecasts, compare actual spend to budget, and optimize cash flow, which is fundamental to the financial viability of an entity. They can ensure the business complies with the relevant accounting standards and legal requirements and provide tax advice specific to the needs of a business to optimize tax requirements.
How accountants are helping entrepreneurs kickstart their business to success
Each startup is unique and needs tailored financial assistance. Engaging an accountant for a startup as early as possible is recommended to help smooth out the process and help pave the way to success by:
There will come a time when you really should outsource or delegate all of your accounting.
If that time is now, let’s chat about getting you your own dedicated accountant. As an ISO9001 certified outsourcer, we will assign you a qualified accountant who operates skillfully at the highest level and who is managed by a local accountant.
We offer low prices with fixed monthly costs which means no hidden fees and no nasty surprises! From Bookkeeping to Tax to SMSF Admin and Audit, we offer the full suite of Accounting and Finance services to free up your time and give you peace of mind. Let’s chat!