A small business accountant Melbourne can be a significant investment that can help traders save money, ensure tax compliance and understand technical financial systems. All traders need a good accountant, but in many cases, it is neither practical nor profitable to create and maintain a special accounting department. If you are a salesperson, some factors help you determine when you hire a financial planner Moorabbin or outsource your online bookkeeping to professionals. As your business grows, auditors can keep pace with changing and changing needs.
The accounting rules and conventions governing the registration of traders’ commercial transactions and the preparation of their final accounts by accountants are essentially the same as for the individual operator. For instance, tradesmen will have a cash book, sales day book, purchase daybook, journal, sales ledger, purchase ledger, and nominal ledger. They will also prepare a profit and loss account annually and a balance sheet at the end of the accounting year, that is why it is best to seek the assistance of a business accountant Moorabbin.
They are, however, some differences in the accounts of tradesmen, of which the following are perhaps the most significant.
- The legislation governing the activities of tradesmen is very extensive. Among other things, the companies acts define certain minimum accounting records which must be maintained by traders. They specify that the annual accounts of the trader must be filed with the registrar of tradesmen and so available for public inspection. The detailed requirements on the minimum information which must be disclosed in a tradesmen accounts.
- Tradesmen may be very numerous. Their capital is shown differently from that of a sole trader, and similarly, the appropriation account of a company is different.
The Accounting Records of Tradesmen
There is a legal requirement for tradesmen to keep accounting records which are sufficient to show and explain their transactions. The records should:
- Disclose the tradesmen current financial position at any time.
- Day to day entries of money received and spent.
- A record of the trader assets and liabilities.
- Where the company deals in goods. A statement of stock held at the year-end, and supporting stocktaking sheets. With the expectation of retail sales, reports of goods bought and sold which identify the seller and buyer of those goods.
- Enable the directors of the trader to ensure that the final accounts of the tradesman give an accurate and fair view of the trader’s profit or loss and balance sheet position.
Registers: the statutory books
A tradesman must also keep some not accounting registers. These include:
- Register of members
- Shareholders 3 percent interests
- Register of charges and a register of debenture holders
- Directors and trader secretaries
- Register of directors interests
These registers are known collectively as the statutory books of the tradesmen.
One of the significant problems with tradesmen and failing to do the accounting for their trade business is that the enterprises grow so fast to the point where the traders do not have time to worry about the contacting an accountant.
They get caught up in trying to perfect their customer service, that they do not see the significance in understanding the financial aspect of the business up to par. Hopefully, tradesmen will begin to realize how important small business accountants in Melbourne are for them, and we will see more successful businesses and less failed businesses in the future.
Hiring an accountant that specialises in your profession is an important factor in ensuring your finances are managed correctly. For example medical accountants for doctors in Melbourne or tradie accountants will ensure you are meeting all requirements of your business.