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Accounting firms are important to finance because they deliver many accounting, auditing, tax and consulting services. The main tasks they perform are examining financial reports for firms and organizations to ensure that they contain appropriate figures in line with guidelines, preparing taxes for individuals and businesses, consultancy on financial management to enhance efficiency and profitability within an organization, and assurance or advisory services.
Understanding the benefits of accounting firms
The most visible and vital role of accounting firms is to audit the financial statements of public companies. In many countries, legislation requires that public companies appoint auditors annually to check their financial reports. In this case, for example, an accounting firm that examines the company’s financial statements hong kong accounting firms, containing the balance sheet, income statement, statement of money flows and accompanying disclosures relating to it
It expresses an opinion as to whether they present an accurate and fair check of the company’s financial position and performance by applicable financial reporting standards. Once this is the case, investors, lenders and other stakeholders make financial statements when making an investment choice or lending decision.
Other than carrying out audits, accounting firms have also become centers where many organizations have their annual or quarterly records prepared in the correct form while at the same time ensuring the proper application adheres to accounting policies. A long process of learning has to be undergone by these professionals before acquiring a wide range of knowledge on international financial reporting standards and other related laws, as well as generally accepted accounting principles.
On the other hand, it is only possible for some small businesses/startups and non-profit organizations, which may need more finances to establish internal accounts departments. Therefore, such institutions usually outsource their accountancy work so that these records are kept in order through recording transactions, preparing books of accounts, and having tax returns appropriately fixed.
Accounting firms are invaluable for both corporate and individual tax compliance. The range of intricate issues’ center’s on planning international corporate taxes, transfer pricing policies, tax incentives and employee stock option plan implementations as well as individual tax return preparation. For instance, most large companies, including some rich people, hand over their tax responsibilities to accounting firms. Hence, they can ensure that any transaction or partnership they structure is efficient in taxation but compliant with relevant provisions.
Within accounting firms, there is substantial specialization with groups of accounting professionals explicitly dedicated to audit, tax, risk consulting, transactions and IT implementations, amongst other specializations. It allows them to develop very specialized capabilities.
Most mid-size plus large accounting companies even offer industry-specific services,for financial services providers, healthcare institutions, technology/telecommunications companies, manufacturing entities, etc. By focusing only on selected industries, sector-specific about industry-specific issues in such markets as well as regulatory and business environments that create helpful solutions for clients.
In summary
Accounting companies offer four basic services which contribute to transparency and integrity of financial markets and enhance efficient financial management: auditing the financial statements, tax planning and advice, consulting on key financial and operational transactions as well as other matters apart from their technical accounting skills.
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