Consider a chartered accountant
There are many accountants out in the field, but a chartered accountant is able to do much more than crunch numbers. They are able to guide you during difficult financial times to turn a negative situation into positive.
But most importantly, a qualified chartered accountant is able to provide expert advice during important instances during your company’s lifespan. A chartered accountant is:
- A member of the Chartered Accountants Australia and New Zealand
- Required to undertake mandatory professional development training
- Bound by CAANZ’s code of ethics and is required to adhere to professional standards
- Subject to our disciplinary procedures
- Trained for a minimum of seven years to achieve this professional qualification
- Subject to three-yearly review of their professional practices where they offer services to the public
- Eligible to obtain a Certificate of Public Practice to offer services to the public.
In this article, we’ll discuss two crucial instances when having a chartered accountant on your team can pay dividends – when you begin your company and when you decide to sell it.
Establishing your business’ legal structure
Not all business’ have the same legal structure. Some might be limited companies, limited liability partnerships, incorporated societies or trading trusts – others could be sole traders.
You should carefully consider each type before deciding which one best suits you. For example, you may do business as a sole trader, working on a self-employed basis and invoicing under your own name.
This also means, however, that you could be held personally liable for any business-related obligations. If your business fails to pay a supplier, the creditor could legally come after your house or other possessions.
With a limited liability company structure, it’s different – the liability of the business is limited to the assets owned by the business, not you personally. But be careful -there may be exceptions in some circumstances.
Which circumstances?
Well, this is a prime opportunity when a chartered accountant can explain the business structures available and help you choose the one that best suits you.
What about when selling your company?
An accountant will put your company’s financial records in order and produce statements of accounts that you can show to prospective buyers.
A chartered accountant can also talk to any potential buyers’ accountants during the due diligence process, which is often a requirement when a business is being taken over.
And a chartered accountant can help you structure your financial affairs so that you get the most money from selling your business. Depending on how the sale is structured, the amount of money you receive after tax can vary considerably.
Every company sale is different and a good chartered accountant will help you get the best result when you sell up.
If, however, an unfortunate circumstance occurs prior to a sale – such as your company becoming insolvent – your chartered accountant will be able to provide options in how to move ahead for the best results possible.
A chartered accountant is an important team member of your company — they let you focus on running and leading your company while they focus on the financial side of business. Their strengths complement your company’s strength.
Interested in receiving advice from a qualified chartered accountant? Please email Matt at mkemp@gerryrea.co.nz