The Role of an Accounting Firm in Business: An Overview

Accountants provide valuable services to businesses that contribute to an organization’s financial health and prospects. Therefore, accountant training could be ideal if you are interested in finance-related work or prefer a highly organized work environment. Depending on your employer, accountants perform various tasks, from advising senior management to managing accounts and day-to-day operations. In this article, we look at the role of bookkeeping in a business, define accountants’ responsibilities, and explain why bookkeeping is important in the workplace. 

WHAT IS THE ROLE OF ACCOUNTANTS IN BUSINESS? 

The accountant’s role in a business is to ensure accurate and current reports and documents. Companies are legally responsible for maintaining their internal accounting to a high standard, with specific compliance guidelines to follow depending on the industry. 

Qualified accountant uses their skills to manage a company’s finances, provide reports, and quickly find and resolve any financial problems.

The size and requirements of a business can determine the role of an accountant. For example, an accountant might handle compliance, accounting, tax reporting, and filings independently in a small business. In a large company, this responsibility may be divided among several specialists to account for the higher volume of financial information. While the specifications of the Accounting Finance role may change, the basic financial reporting or clarification duties remain the same.

WHY IS ACCOUNTING IMPORTANT?

Accounting is essential for businesses to meet regulatory guidelines and ensure good financial standing. As a role that involves working directly with finance daily, accountants have the insight to provide clear and accurate financial reporting and information. In addition, this role is essential for a good understanding of financial processes, business strategy, and analytics. 

Some of the reasons why accounting is important for businesses often include:

EVALUATING THE EFFICIENCY AND HEALTH OF THE BUSINESS 

A qualified accountant can quickly assess a company’s financial position, providing stakeholders and senior management with insight into the company’s performance. For example, an accountant might create a report that compares last year’s expenses with the current year’s expenditures to see if expenses have improved. This information helps companies make important decisions and provides the information needed to align strategies and processes based on their current financial position.

ENSURE COMPLIANCE WITH REGULATORY AUTHORITIES

Companies adhere to strict regulations regarding managing their finances, which can vary by industry. An experienced accountant has the knowledge and skills to understand all instructions, keep up with changes, and advise on how to comply. For example, accountants may prepare annual financial statements for a business, which is a compliance requirement in addition to other tax filings. Compliance is an important requirement to avoid fines and penalties.

MAKE A FEASIBLE PLAN AND STRATEGY FOR BUSINESS ACTIVITIES

Accountants contribute directly to the planning and development of a business over time. As a financial specialist in a company, this role may include forecasting and advising on using the company’s money safely and effectively. For example, an accountant might work with a sales manager to budget for the next year’s sales activities based on the company’s current financial position. Understanding how different plans and growth can impact a business’s finances is essential to successful business planning.  

COMPLETE FINANCIAL STATEMENTS ACCURATELY AND ON TIME

One of the most important tasks accountants perform is updating financial statements and information for different business purposes. For example, an accountant prepares detailed finances before tax season to file quickly, avoiding late fees or penalties for inaccuracies. These reports may also be needed for various processes, such as audits, mergers, or acquisitions, that make accessing up-to-date financial information essential. In addition, periodic financial statements provide an easy way to gauge the health of a business over time.

PROVIDE FINANCIAL OVERVIEW TO OTHER DEPARTMENTS

As accountants work alongside sales, support, and marketing, they provide a top-level overview of the company’s finances. This perspective is useful for individual departments and senior management in budget planning and fund allocation decisions. For example, the CEO or director could work with the accountant and CFO to determine allocations for different departments, then allow the accountant to implement the agreed budget across the business.

WHAT ARE THE ACCOUNTANTS RESPONSIBLE FOR?

Accountants are responsible for many different financial tasks within a business. With an emphasis on analytical skills and digital literacy, this career primarily focuses on financial reporting responsibilities. Accurate, up-to-date, and consistent financial details are essential for every business action and operation.

Accountants use their knowledge to communicate this information, prepare reports, and conduct meetings to determine the business’s financial position. In larger companies, accountants may work together on specific tasks and work individually with others.

 For example, one accountant might work with senior management on forecasting and business growth, while another supports larger departments with financial reporting and budgeting. Accountants may also take on bookkeeping responsibilities in small businesses, recording the amount of money coming in and out of business from purchases and sales. 

CHOOSING A CAREER IN ACCOUNTING

Some of the career options you can pursue in the accounting field include the following:

• EXTERNAL AUDITOR

National average salary:

£30,784 per year

The main task:

External auditors work as trained professionals according to companies’ guidelines and regulations. This role may involve traveling to different organizations nationwide to analyze the financial position of different businesses in detail, make recommendations, and issue alerts where necessary. Some auditors work for regulatory agencies, while others work independently, helping companies arrange their finances before an audit.

• ACCOUNTANT

National average salary:

£35,451 per year

The main task:

Certified public accountants are fully qualified professionals working in various accounting positions, either paid or independently. Typically, certified public accountants provide traditional accounting services to businesses and individuals. For example, they may work as an outsourced accountant for construction companies or find a job at a large accounting firm that provides services to many businesses and individuals.

• MANAGEMENT ACCOUNTING

National average salary:

£36,105 per year

The main task:

Management accountants use their skills in business strategy and management techniques to support the decision-making process within a company. For example, a management accountant might work with the management team to decide how to grow the business based on their financial knowledge. However, unlike most accounting positions, management accountants may not be involved in the data and bookkeeping that is part of other roles.  

• PUBLIC FINANCE ACCOUNTANT

National average salary:

£42,199 per year

The main task:

Accountants work in organizations that use public funds, such as the Home Office or charities. These professional accountants may receive additional training, such as the CIPFA program, to qualify for these roles, with special record-keeping and public expenditure requirements. For example, they may work on a local council that budgets and oversees a road repair fund, fleet, or waste service.

• TAXES CONSULTANT

Average wage:

£42,712 per year

The main task:

Tax advisors are financial professionals who provide services to businesses and individuals to help them understand their tax obligations. For example, a small business might hire a tax consultant to explain how taxes work in their industry during their first year of operation. Tax advisors can provide information or be directly involved in helping businesses meet their tax obligations by handling the accounting function.

• FORENSIC ACCOUNTING

National average salary:

£51,800 per year

The main task:

Forensic accountants are professionals who specialize in investigating financial situations when funds are missing or fraud has occurred. For example, when a company hires a forensic consultant to uncover lost funds, the consultant will work to gather evidence for recovery or initiate legal action. Forensic accountants can testify in court as expert witnesses and submit evidence of their findings during the case.

• FINANCIAL CONTROL

National average salary:

£56,465 per year

The main task:

Financial controllers are senior business professionals who handle many aspects of financial management, including business accounting, financial reporting, and forecasting. In larger companies, the financial controllers may have an accounting team working for them to provide the information needed for the reports. In addition, many financial controllers oversee month-end and year-end closings, focusing on accuracy and quality control.