Good account maintenance for small business is the key for operating a healthy, stable, growing organization.
“SMEs have always been the backbone of the UAE economy” says Mohsin Aikal
Small businesses are drivers of growth as they generate huge employment opportunities and have a significant impact on the economy.
Importance of Accounting:
Proper decisions:
Analysis of relevant facts is important for proper decision making. Maintaining good financial will help you a lot when you are preparing the financial statement. Any decision made without proper analysis of facts will lead to failure in decision making process. Without proper accounts, we may not have all the relevant facts in our hands and as a result lack of required facts will damage the smooth decision-making process.
Statutory compliance:
Without adequate financial records, preparing your tax records may be difficult. Proper maintenance of books will pave the way to easy tax computation. These are generally the same records you use to keep an eye on your business and prepare your financial statements. Hence proper account maintenance is important for Tax related compliances.
Adequate information to stakeholders:
By giving the stakeholders accurate financial information about the organisation, accounting services aid in the improvement of business decisions. More crucially, accounting’s function in business is to ensure that the stakeholders comprehend the significance of the financial data and to assist both individuals and organisations in using that data to solve problems related to their operations.
Evaluate your business:
When you have a solid track record with your finances, the state of your company will become clear. Without accounts, it is impossible to identify the sections that need to be changed or abandoned. For instance, one business unit might suffer a significant loss while other units might see some profit. Even though the overall outcome is a loss, just the unit that is creating losses needs to be shut down. It is incorrect to decide to close all of the units, even those that are profitable. Maintaining financial records can improve a company’s chances of success.
Importance of Accounting for Small Businesses in UAE
Identify sources of income:
A small business may be financed with assets and funds from multiple sources. Proper records are necessary to show the source of the income. Business & non-business income, taxable and non-taxable income classification can be made only with accurate accounts.
Instant reaction:
You can respond promptly to any development that occurs in the market or industry when you have a full understanding of the company. For instance, the COVID-19 Pandemic has a severe impact on all enterprises worldwide.
In response to the unanticipated Market changes, numerous Crucial Decisions must be made in order to return to normal business conditions. An effective accounting system provides quick response to unforeseen business events.
Out-sourcing the Book-keeping task:
Despite all these reasons, businesses may have certain difficulties in Maintaining Books themselves. The reason being, core business activities may get affected, if more time is spent on Accounting Task. Hence, it is better to outsource the Book-keeping Task to Experts who will reduce your burden. KGRN Chartered Accountants offers a variety of Accounting services in Dubai to comply with your Business requirements. Our Team of Experts will provide a Special Attention to your Business & Customized requirements will be satisfied in a Better manner.
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