We are pleased to announce the release of our latest podcast Episode 11 – Why is Accounting Such an Important Business Discipline? Accounting may be one of the most important and yet under-valued aspects of business in the eyes of managers and owners alike. However, in this episode of ABCast, Janathan Allen shares that a sound accounting strategy is actually the underpinning of virtually every company of business. There isn’t a sound business decision which can be made without information which is captured by and ultimately reported out of a well designed accounting system.
Janathan describes the essential elements of any accounting system such as Accounts Receivable (AR), Accounts Payable (AP), bank and credit card reconciliations and how your accounting strategy should not only ensure the capture of accurate and timely information, but also provide important protections to prevent theft or financial misconduct.
The chart of accounts basically determines what it is that will be measured and how the information will be used within reports such as financial statements, profit and loss analysis, the balance sheet as well as tailored insights and dashboards based upon the needs of company leaders and executives. Accurate information should provide business decision makers with insights into every measurable aspect of business operations.
Episode 11 – Why is Accounting Such an Important Business Discipline provides insight into how elements of accounting are genuinely the backbone of any business. Your business accounting system directly feeds into tax preparation and reporting. A well-designed accounting system captures detailed expenses and data which can be analyzed in business decision making but it is also the source of many tax-related challenges. Janathan Allen says issues which result in a controversy such as an IRS or California tax audit are often actually rooted in underlying accounting issues. If the information captured in the accounting process is incomplete or inaccurate it creates issues and potential liabilities in every aspect of business financial and tax reporting. Sound accounting data is also the best defense for refuting assertations made by tax authorities and achieving the best possible result in any inquiry or audit.
Many business owners are not aware of the impact good accounting has upon the actual value of the company itself. This is true when a business seeks a round of new financing, or discusses a merger with another entity. When a potential buyer looks at acquiring a company, the quality of the accounting system can either diminish or greatly increase the value of the business itself. A well-crafted and executed accounting strategy reduces the challenges and time consumed during due diligence, and substantially increases the confidence in the transaction as well as the price another party is willing to pay for the company.
We invite you to listen to ABCast Episode 11 – Why is Accounting Such an Important Business Discipline and hope you enjoy learning more about accounting and the integrated offerings of Allen Barron, Inc. We invite you to meet with Janathan Allen and the experienced team at Allen Barron by contacting Allen Barron, or call 866-631-3470 to schedule a free consultation.
Read a Transcript of Episode 11 – Why is Accounting So Important
