The following disadvantages to be discussed in this section are (1) cost and (2) liability.
Cost. When establishing a small business and in the being phase of a startup company, money is tight. The company has yet to take shape but the need to generate growth is a huge concern. Cost is an incremental factor that deters the businesses owners’ decision to hire an accountant. Part of the costs involved in hiring an accountant includes their salary, benefits, and office space. Figure 2 shows that an accountants education level and experience has a significant impact on their salary. With an increase in experience and specialization comes an increase in price. Benefits are also pricey and the need to provide an office space for the accountant can be more expensive if a space is not available and expansions are needed.
Liability. In any business endeavor, risks will arise. The decision to hire an accountant involves a degree of risk. Accountants can become a liability to a business through improper control, accounting errors, and trust. By hiring an accountant, an owner relinquishes their control over large portions involving finances and accounting for changes within the organization. The accountant now has control over one of the key components of the business and the owner has placed their trust in them. The accountant has the responsibility to accurately complete financial records and fulfill accounting standards and financial reporting practices. As the owner focuses on the business, they trust that the accountant won’t make any errors. In the event that the accountant makes a substantial error, the ultimate liability falls on the owner. The accountant would be liable to some degree but the...
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...ck of control and the ability to trust them will impact any business both large and small. With alternatives available, business owners need to weigh the pros and cons of having their own accountant conveniently within arms reach in their organization.
I recommend that small businesses and startup companies take advantage of the services, skills, and benefits that accountants can provide. They are able to save any organization, big or small, money and provide knowledge to help any company grow. The cost of having an accountant is much less than if the fees, fines, and lost profits as a result of inaccurate reporting and unethical behavior both internally and externally. If the goal is to grow an organization and take advantage of other financial opportunities, then consider having an accountant within the organization along with accounting software.
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