Red flags That indicate that You Need an Accountant for Your Business

Red flags That indicate that You Need an Accountant for Your Business

Dubai, being one of the greatest business hubs in the world, attracts a lot of investors due to its business-friendly policies and regulations. As a result, there is an increase in business setups in Dubai, UAE. These businesses are mainly focused on gaining growth and adequate profits, but not being aware of the need for an accountant may become a hindrance in achieving their goal. Most firms fail to understand the requirements of an accountant because they are not able to identify the red flags pertaining to them. This blog provides some signs that may indicate that a business needs a professional accountant.

SIGNS THAT INDICATE THAT A BUSINESS NEEDS A PROFESSIONAL ACCOUNTANT 

• When your business is paying huge amounts of taxes

Payment of taxes is one of the major responsibilities of every business entity. The firms must stay compliant with the tax laws and should not make any delays in filing the returns. But sometimes your firm may end up paying a huge amount of tax, which may be more than the anticipated amount. It indicates that there are some issues in the management of taxes and finances. So, in such cases, it is always better to consult a professional accountant who can help you minimise tax payments and penalties.

• Chaos in keeping track of accounting and bookkeeping records

As your business improves and grows, the number of transactions and the cash flow will also increase, which will make accounting more complex. In such a situation, you may not be able to keep track of all the accounting records. And falling behind in keeping track of the account will drastically affect the business. If you hire a professional accountant, he will, with his expertise, manage the accounts smoothly and provide your business with an efficient outcome.

• Misplacement of important documents and receipts

Documents and receipts are the proofs that show a transaction has taken place; if these important documents get misplaced, it will affect the accounting, as you won't have any clarity about the transaction and the amount of such a transaction. This indicates that your accounting system is in a drastic state. Whereas if you adopt the outsourcing of accounting services or hire a professional accountant, he will maintain all the documents and keep them updated. 

• Planning of expansion of business

If you are planning to expand and diversify the business outside of the state, then you will need an accountant. Expansion of business will require adequate knowledge of the laws and regulations of the new state and the hiring of new employees, along with selecting proper business locations, etc. If you have a professional accountant on your team, he will know the tax laws and other information about the state and will also assist you in hiring employees, etc. so it is always best to hire an accountant before you expand your business.

• When your financial statements aren't professional enough

If you are in search of new investors for your business or plan to gain financial assistance from any of the financial institutions, then you will need to furnish your annual financial statements to them. If you don't follow accurate standards or if you don't professionally prepare the accounts, then, the investors or institution won't be able to draw accurate conclusions, and they may be reluctant to invest in the business. So, to avoid such cases, it's always the best course of action to hire accountants who are professionals and experienced.

• Before performing an audit

If your business is planning to conduct an audit, then it is a clear sign that your firm needs an accountant who can organise the document and all the records of the transaction. The accountant will also assist in the auditing and help the auditors with their requirements. Hence, the accountant plays an important role in the auditing process.

How can CDA assist you?

CDA being the leading accounting and auditing firm in Dubai, UAE, can provide your business with an expert accounting team to meet your various needs. CDA's accounting team is experienced and well-qualified in accounting, as it has well-experienced team members, especially those who have worked in the big 4s. CDA provides an all-round accounting and auditing solution to its clients along with other services like VAT return filing, AML-CFT compliance, etc. To know more about the services of CDA consult us now.