Want to earn more in business?

Manage the accounts yourself

"If business owners knew how much independent bookkeeping could increase their profitability, they would start managing the accounts themselves today," says CPA Osher Kider, founder and director of Kider Accountants. About the advantages of the unique method

Dor Avshalom, in collaboration with zap legal

31/07/2022

Sunday, July 31, 2022, 1:50 p.m

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Kidder CPAs believe that in order to generate success, the business owner must be led to also become a business manager (Photo: ShutterStock)

Almost every business owner knows this experience: at the end of each year, a meeting is scheduled with the accountant where data are presented on the results of the economic moves made by the business during the past year and the final profit line.

As you know, these data make up the annual report of every business.

"The big problem with that 'annual meeting'," claims CPA Osher Kider, founder and director of Kider CPAs, "originates from the fact that the first time most business owners are exposed to their performance and the profit line The final one is only a few months after the year ends. Only then does the business owner find out, for example, what happened to all the invoices he sent to the accounting department during the year, and how much money from his actual expenses was ultimately recognized as taxable expenses."

In accordance with the accepted method, according to which most businesses in the State of Israel are conducted, everything related to the accounting of the business - calculating income, expenses and profitability - is done by accounting offices and not by the business.

In fact, the main current task of those offices is to absorb the documents in the accounting software as quickly as possible, in order to produce the reports for the income tax and the VAT, with a minimum of work time.

According to CPA Kidar, "In most cases, the main interest of the offices handling the accounts is to report the monthly reports to the authorities.

They usually don't have enough time to brief the business owners on whether the invoices they brought help them to reduce the taxes they pay, whether these are unnecessary documents that are thrown in the trash, and whether their business is profitable at all.

" The business owner must be led to also be a business manager.

The accountant, however competent, cannot be responsible for the management of the business (unless he is the manager of its finances).

Through proper guidance, the business owner learns in a short process to manage the finances himself, and thus he manages to get a complete picture of his performance at any given moment, and accordingly to price his services appropriately.

how long does it take?

For most business owners - about half an hour a month.

"Let's do a short check," CPA Kidar invites me, "As a business owner, even if it's a small business - do you know what happens to the fuel receipts you send to the accountant every month?

Do you know how much your travel expenses reduce your tax liability?

Do you know how many of your household expenses, such as rent, electricity, property tax and water, you can report as recognized expenses and what is the logic behind that?"

I shake my head in the negative. "Of course the answer is no.

You trust the accountant to do the work for you, but in practice you only find out what happened at the end of the year."

Independent bookkeeping increases profitability

"We believe that every business owner should manage his own bookkeeping," says CPA Kidar, "since it is an integral part of the business.

Every business owner should label the business expenses himself and classify them, starting from marketing expenses to maintenance expenses.

After all, who manages the household for each and every one of us - an external party?

Of course not.

So why, when it comes to the management of a business, does it have to be done by an outside party?"

According to him, "If all business owners knew how much independent bookkeeping could increase their profitability, they would start managing the accounts themselves today.

"Through self-accounting, the business owner understands immediately - and not just at the end of the year - what is considered an expense, what is considered income and what is the monthly tax liability. Even more, the business owner learns for the first time how much money he has left in his pocket from each quote he gives to customers, after Acknowledging the expenses and calculating the tax payment, and accordingly he learns to reprice the services he offers."

"Exactly for this purpose, we developed a unique method, in which we teach business owners to do their own accounting. We teach them how to use simple business management software. The business owners we support know each and every expense, understand how much money they use to run the business, and learn how to To plan tax and reduce tax payments to a minimum in a legitimate way."

Indeed, a profitability survey carried out by accountants in Kidar shows that businesses with self-accounting significantly increase their revenue and profitability.

CPA Kidar concludes: "Our many years of experience indicate that there is a very strong correlation between self-management and the success of the business.

We do this through guidance and proper guidance, which help every business owner to manage correctly and at the end of the day also to increase revenue."

For contact and additional details, please contact here or by phone - 077-8049723

to the firm's page on the Legal website.

Article courtesy of Zap Legal

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