What Does a Tax Accountant Do?

Whether it’s a large corporation or a small business within Melbourne, an accountant is an integral part of it. One of the primary roles of an accountant is to monitor and record the flow of money in business. He/she verifies the accuracy of all monetary transactions that take place, ensuring that they comply with all the legal regulations and comply with the business’ guidelines.

Accountant calculating taxes
The roles and responsibilities of an accountant can differ depending on the size of the business/organisation that the accountant works for. Typically, in a small business, an accountant’s role is limited to financial data collection and report generation. But in bigger businesses and organisations, an accountant’s role extends to that of the financial advisor. Apart from the basic accounting responsibilities, the accountant may also be expected to analyse financial reports and advise the company on its future course of action.

Roles and Responsibilities

We asked Melbourne tax accountants InTouch Accountants for the main roles and responsibilities that an accountant undertakes, depending on the needs and requirements of the business/organisation.

  • Financial Report Generation

Analysing the financial data

One of the most basic responsibilities that an accountant carries out is the preparation of financial reports and bookkeeping. From preparing profit and loss statements to generating monthly and annual reports with the help of the financial data gathered, all financial data that give a bright idea of how the business is performing is produced by the accountant. Data thus produced is a valuable source of information, giving the management tangible proof of how the business is doing and where and how things can be improved.

  • Provide Financial Advice and Expertise

Another key role that an accountant performs is to provide valuable financial advice. As the person who’s been handling all the financial aspects of business, an accountant is well-informed about the financial situation of the business and the course that needs to be taken in the future. By analysing the financial reports and observing the patterns over time, an accountant can provide advice on budgeting and strategies for cost cutting/savings. An accountant can also counsel the board on whether or not a proposed course of action is advisable, given the current financial situation of the company.
Recommendations for improving the system and procedures when it comes to financial transactions can also fall into the realm of an accountant’s job description. A better course of action to resolve or avoid financial issues also becomes a part of an accountant’s job.

  • Process Payrolls

payroll process

Determining payroll requirements, preparing and processing payrolls, and maintaining payroll data also come under an accountant’s job responsibilities. In some organisations, payroll processing is done by the HR department in conjunction with the accounting department.

  • Ensure Compliance with Deadlines

Another key role of an accountant is to ensure that tax returns are filed on time, invoices are paid on time and ensure that all financial reporting deadlines are met. This is an important aspect of running a business. Failure to file tax returns on time can lead to penalties and fines. Similarly, not paying invoices on time can damage the relationship with vendors and other third parties, which can be highly detrimental to business.

  • Set Up and Maintain Accounting Practices and Procedures

While most businesses already have an established accounting system in place, a newly developed business will require the establishment and maintenance of accounting practices and control procedures. An accountant can help set it up, educate the concerned parties on how it works, and ensure that it functions efficiently to smooth out the financial aspects of the business. This involves anything from explaining billing and accounting practices to staff and vendors, to setting up a computer software system for the company’s financial accounting.

  • Providing Advice and Expertise on Business Deals

Whenever there is a business deal under negotiation, the accountant will be called upon to oversee the talks and provide his/her expertise on the matter. They may also help in drafting the final agreement and oversee the deal from start to finish. Having an accountant oversee a business deal will ensure that there are no loopholes or any cause for concern as far as the financial aspect is concerned.

  • Resolve Accounting Issues

calculating payroll process

Anytime there’s any accounting discrepancy; the accountant will be the one to look into and resolve it. Everything from a dispute over an unpaid invoice to any discrepancy in the bookkeeping is to be handled by the accountant. One way in which accountants ensure that any accounting issue gets resolved quickly is by diligently maintaining records. When you have records of every transaction and every financial decision that is made on a daily basis, resolving issues becomes a simple job of checking your files and getting the required information and evidence to solve or end the dispute.

  • Use Graphic Illustration to Explain Financial Outcomes

In some instances, the accountant will be the one to create a graphic illustration of the business’ financial situation. Using charts and graphs, the accountant will be able to communicate to stakeholders about the company’s profit and loss, expected expenditure and ways in which budgeting can be done to reduce costs. Summarising complicated financial reports and data into easy to understand illustrations is key when it comes to dealing with stakeholders.

  • Keep Management Updated

Keeping management updated on the financial situation is another important role to be undertaken by an accountant. The management needs to be made aware of the business’ current financial position on a regular basis. Doing this ensures that the administration take the financial aspect into consideration when making any changes to the business. Whether it is hiring more employees or investing in new machinery, the first thing that the management should consider before making any changes is the finances.
An accountant plays a crucial role in a business’ operations. From taking care of day to day activities, such as paying incoming invoices, to annual reporting functions, such as summarising the annual profit and loss statements, an accountant’s roles and responsibilities are quite vast. To run a successful business, having a competent accountant who not only knows how to manage the accounts but is also adept at predicting the future and providing risk analysis, is essential.

 

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