Ask an Accountant: Your Top 10 Accounting Questions Answered

Accounting can sometimes feel overwhelming, especially for new business owners or those unfamiliar with financial management. We’ve gathered the top 10 most frequently asked questions that accountants often receive, and we're answering them clearly and simply for you!

1. What's the difference between bookkeeping and accounting? Bookkeeping involves recording daily financial transactions. Accounting goes a step further—interpreting, analyzing, and summarizing these records to make informed business decisions.

2. How can I improve cash flow in my business? Track your invoices diligently, control your expenses, offer early-payment discounts, and manage your inventory effectively using reliable software like ABSS/MYOB or SQL Account.

3. Do I really need accounting software? Yes! Accounting software significantly simplifies financial management, reduces errors, and saves you valuable time. Solutions like ABSS/MYOB and SQL Account automate many tasks to streamline your workflow.

4. What's GST, and how does it affect my business? GST (Goods and Services Tax) is a consumption tax applied to goods and services. Proper GST management and accurate filing are essential to remain compliant and avoid penalties.

5. Can accounting software help with tax compliance? Absolutely! Accounting software like ABSS/MYOB and SQL Account is designed to manage tax calculations, prepare accurate GST submissions, and help your business stay compliant.

6. How do I know if my business is profitable? Review your income statements regularly. Profitability is indicated when your total revenue consistently exceeds your total expenses.

7. What's the importance of financial statements? Financial statements (Balance Sheets, Profit and Loss, and cash flow statements) help you understand your company's financial health, performance, and stability, guiding better decisions.

8. How often should I review my financial reports? Regular reviews are vital. Monthly checks are recommended, but weekly reviews can be even more beneficial, allowing quick reactions to changing business conditions.

9. How can I prevent accounting fraud in my business? Maintain strong internal controls, regularly review your financial statements, and separate financial duties among different team members to avoid potential fraud.

10. Do I need an accountant if I'm already using accounting software? While software simplifies tasks, a professional accountant provides valuable insights, strategic advice, and ensures compliance, helping you navigate complex financial scenarios.

Have more questions or need professional accounting assistance? Reach out to us today, and our experts will be happy to assist you!