Accountancy is an extremely varied field. The world of finance is an immensely complex one, and cadres of specialist accountants have developed over the years to help businesses and individuals take more control of their monetary matters.
Accountancy has had a long time to develop into specialist fields – having been practiced by human beings for over 9000 years. Businesses have many reasons for hiring an accountant: the most basic of those being to ‘balance the books’. Balancing the books involves accounting for expenditure, budget, and income. Every accountant will have the ability to balance these elements, no matter what kind of specialization they have. This article is a very brief guide to the kinds of specialist accountants that prowl financial battlegrounds today.
Auditors are specialist accountants that make sure a company’s financial records are completely in order. Expenditure, budget, and sales figures are carefully poured over to ensure there are no irregularities. Auditors are employed for several reasons. They are able to develop reports that indicate structural or financial problems within a company so that they can be improved upon. They carefully monitor cash flow in order to create financial transparency. They are able to assure companies that they are operating within the bounds of the law when it comes to taking account of their financial records. They are able to notice areas in which money is being wasted, lost, or misappropriated.
Financial auditors use their analytical skills to assess data and build a picture of a company’s financial health. Typically, they do not take responsibility for fixing a company’s problems. Instead, it is their responsibility to simply identify issues and make them clear to their clients. This is extremely important. Any bias towards the client company – say, a desire not to find issues – could jeopardize an audit.
A good tax accountant is a prized asset for any business wanting to stay profitable. Tax accountants help to prepare a company’s annual tax returns. They help companies get the maximum amount of tax deduction within the bounds of the law. Most nations have strict laws about what a company can or cannot do to improve its taxation situation. Tax accountants have a good working knowledge of tax law as well as good basic accountancy skills. Because a good tax accountant is so valuable to a company, they often stay with the same firms for years.
Tax accountants are expected to be able to liaise with government officials during the tax return process. They can advise clients on changes that need to be made in their business practice in order to receive better tax deductions in the future. Tax accountants are responsible for advising companies on how to stay within the constraints of the law. If a company decides to break the law, a tax accountant is often entitled to break contact with them, as their reputation could be damaged irreparably.
Management accountants are employed to create internal reports on a business that can be used to alter management practices profitably. They analyze the areas in which a business is doing well and doing poorly. Using data to create chains of reasoning behind these failures and successes, they can inform company leaders.
Management accountants are great at creating understandable models from abstract data. They harness the latest AI technology to analyze big datasets when building a picture of a company’s financial hurdles and milestones.
Forensic accountants are specialists in the investigation of financial crime and mishandling. Financial manipulation and crime are a huge problem in the world of big business, and billions of dollars are lost each year – stolen from the taxman or hidden from stakeholders by corrupt leaders.
Forensic accountants are hired by government organizations and private companies alike when preparing for financial litigation concerning fraud, embezzlement, skimming, or any other kind of white-collar theft. They are equipped to take a deep dive into a company’s financial records to find out whether a crime has been committed. Companies will often hire forensic accountants to help them ascertain the cause of a financial irregularity which plausibly could lead to litigation in the future. Avoiding litigation is the name of the game.
Governments have plenty of reasons for hiring accountants. Government use of money is (or at least should be) fully transparent due to the publicly sourced nature of funds. For this reason, governmental departments are required to keep extremely accurate records of their expenditure, budget, and income.
Government employed accountants also have a role in the investigation of financial crimes and tax evasion. At a more senior level, government accountants are consulted by politicians and think tanks when developing financial policy. Accountants can use their analytical skills to provide political policymakers with the means to make sensible budgeting decisions.
A company becomes insolvent when it cannot pay its liabilities or when its liabilities outstrip its assets. This is typically bad news. Insolvency accountants are hired in to try and control the situation before a company goes under. They look through the records and resources owned by a company and work out ways of reducing debt. This can be through the sale of assets, restructuring staffing systems, or placing the company into administration.
Insolvency is an inherently tricky situation for a company to be in, but a specialist accountant can take some of the strain away.
Private individuals regularly hire accountants. Accountants can help individuals in a number of areas. Wealthy people often hire accountants in order to minimize the amount of tax they pay on their fortunes. This can often lead to some rather nasty situations in which money is stored overseas. Less wealthy people still hire personal accountants. This is often to formulate a pension plan for when they retire or advise on savings options. Personal accountants are generalists: they are able to offer a broad range of services to clients who want their books balanced and their financial situations improved.