Many small businesses do not have an accountant on their own payroll – they choose to outsource this role to an external provider, often a firm of accountants. But the traditional high-street firms of accountants are predominantly financial accountants and have been trained with a focus on accounting standards and tax. As a result, they have little real-life experience of actually running a business. They end up focussing on historical information and serve HMRC, Companies House and other external stakeholders rather than the business owners who are hiring them.
Management accountants however, have experience working within organisations such as your own. As Wikipedia puts it (quite succinctly, I think) “Management accounting is concerned with the provision and use of accounting information to managers within organisations, to provide them with the basis to make informed business decisions that will allow them to be better equipped in their management and control functions”.
I could summarise the key attributes of a management accountant as follows:
- Primarily forward-looking, not back
- Working for YOU, the business owner, rather than for the regulatory authorities
- As partners with you, putting YOU in control of your own business numbers
- Producing the numbers and analysis that YOU need to run your business, not just the numbers that HMRC needs to verify your tax
- Designing and implementing systems and reporting to aid YOUR strategic decision-making
So, to get the best value from your accountant, contact should be more than just once a year come annual accounts-time. Engage your accountant to become an integral part of your business and regularly review the numbers and planning opportunities TOGETHER to maximise the chances of a successful enterprise. Management accountants, of all the members of the accounting profession, are absolutely the best placed in terms of experience and training to fulfil this partnership role.