The business needs economic, reliable and careful guidance to grow. Why is the accounting and tax part of a startup important.
Startup is the term used to designate those newly created companies with high growth potential in the medium term. Although they can be developed in any market, this term usually refers to companies with a strong technological component.
Startups must bring something new to the market and present a scalable business model.
Entrepreneurs who set up a startup are usually experts in the product or service they offer, but the data show that this is not enough to be successful because, although we are all aware that the product and its market-fit is the most important thing, complying with current regulations, whether of a commercial, fiscal, labor or legal nature, can become a matter of special relevance that is difficult to solve when adventures are started in a hurry.
Although there are many factors by which a company can be successful, the role of having everything in order is especially important in three possible situations:
When we seek financing, since even in equity loans aimed at startups a healthy and up to date balance sheet is usually required.
When we have claims, whether from workers, creditors or partners, for which we must have everything properly prepared, since the Workers’ Statute and the Capital Companies Act do not “understand” startups.
When we have an investor or an interested buyer and a due diligence begins to take relevance when lowering its offer for possible future contingencies that appear in a review by its legal team.
Another relevant aspect is related to financing and cost control and this is where many startups fail. It is very necessary to have the knowledge and experience to raise money and know how to manage it.
In Galicia, for example, there are both public and private initiatives to support entrepreneurship: accelerators such as BFFood, BFAuto, the very recent CoLogistics or others, as well as collaborative initiatives of the entrepreneurs themselves such as Furancho Startup Galicia, with its own slack channel in which they talk about projects, industry news, job offers, financing, etc.
And finally, another point to bear in mind is that most entrepreneurs, especially those who develop innovative or technological products, are usually experts in technology rather than in managing the finances of their company, which they do almost by trial and error. This, together with the fact that in many cases entrepreneurs resort to innovative forms of financing with venture capital companies, have to deal with investment rounds, grace periods and the transfer of part of their company, makes financial management extremely complicated.
For all these reasons it is advisable that they turn to advisors who know in depth everything that revolves around the management of startups; experienced professionals who offer a service perfectly focused on their needs and peculiarities.
Tax advisors are necessary for accounting and tax filing.
When starting the adventure of creating the startup, the first thing the advisor will advise you to do is to draw up a design (of a commercial and/or labor nature) that covers the business plan to be developed. This plan must be revised to adapt it to the different situations that arise throughout the life of the company.
The advisor will also provide you with an online accounting program that will be a great ally to correctly keep the accounts of your business and thus control and make important decisions for its growth. With this program the advisor will be able to consult the data and do the accounting from anywhere, keeping it up to date and the entrepreneur will have updated reports and will be able to give access to the information to the members of the team he/she wants.
Having real-time data on expenses and income helps to detect problems and address the most appropriate solutions earlier.
The advisor will also have to provide a system to keep invoices under control, a secure and infallible system because if you have errors you can lose money due to lack of control.
And of course, the adviser will have your company up to date with the Treasury: the VAT declaration, the payment of taxes, quarterly, annual liquidations… in short, to keep the accounting of our economic activity.
To inform you of aids, bonuses and deductions that exist is also the work of the adviser who has to be informed of the same ones to indicate which one is necessary to request because they will help you to diminish costs and to increase the growth of the company.
Being rigorous with the taxation and accounting of the startup will help to prolong the life of the company by laying a good foundation, which is essential for the success of all businesses.