Accountants can provide advice on audits or tax matters
- An accountant can provide advice & guidance.
- You can engage an accountant to handle an ATO audit.
- Strategy & planning is available via a CPA.
- Managing BAS, ATO audits or tax returns can be made simple to manage.
If you are a business owner who manages their own daily bookkeeping you might only consider using an accountant when it comes time to prepare your annual tax return. Although, you might be in a situation where you need an accountant that provides advice on tax return-related issues especially if it is also related to an ATO audit. Not all accountants in Sydney have the breadth of experience or knowledge to assist with ATO audits, especially ones that relate to the operations of a business. In fact there are quite a few different types of accountants in Sydney and it is important you engage with the right one to ensure you receive the right advice
What is the difference between an accountant and an auditor?
An accountant is a very popular service in Sydney where the person typically has an analytical mindset and a desire to work with either a business or personal financial data. The accounting team that we have at Fitzpatrick and Robinson primarily provides in depth financial analysis and accurate reporting for small and medium sized business owners. Our qualified accountants can assist with day to day financial operations, the accuracy of the financial records of a business as well as things like taxes, payroll, BAS or even asset management.
Accountants will typically have more experience and a wider set of skills compared to a Bookkeeper which gives any business owner access to a wider array of support services including handling tax related matters or the management of an ATO audit request. Rather than just managing daily transactions and balancing the books, an accountant can provide expert tax advice, guidance and suggestions for minimising what a business pays, but also strategic choices if your business is hit with a tax audit in Sydney.
An auditor’s role is to specifically analyse the work produced by an accountant to verify that all of the information is correct. This includes examining financial statements prepared by accountants to ensure they represent a business’s financial position accurately. An auditor’s function is to make sure everything is prepared in accordance with local accounting practices. An auditor has to be able to clearly and succinctly explain their findings whether a businesse’s financial statements are all in order or not.
While the type of person that does accounting or auditing may be similar in terms of aptitude and skill set, there are subtle differences. Accounting requires a person who is more detail-oriented and focused, they will have a broader understanding of business matters and can guide you through the ATO audit process. Auditors also value attention to detail, but they also need strong investigative skills. The auditor will capture honest mistakes, detect subterfuge, fraud, and intentional misstatements by looking deeply into all the details, but they generally don’t have the broader knowledge about managing a business.
What are the different types of accountants?
There are a few different accountant types in Sydney that you can contract for your business. It is important to differentiate between a bookkeeper and an accountant to make sure you get the right level of service that you need, especially when it comes to handling tax related tasks to manage your business
Tax accountant for businesses
A tax accountant for a business will analyse all relevant financial matters to prepare, submit and manage the tax statements and returns for any type of business entity no matter what niche it is in, or if it sells products or services. Our accounting firm in Sydney specialises in helping businesses with four or more employees where help is needed for daily management of the accounts as well as things like payroll, employee contract management or BAS submissions.
Handling your taxes for a business can sometimes get a little complicated especially if you have a medium or large size entity with multiple employees. There might be new laws that are applicable or changes to existing laws that people running a business need to adhere to. That’s why it’s crucial for a business owner to engage with an experienced tax accountant that keeps up to date with the latest news and changes to tax law to ensure you can maximise your deductions, avoid an audit and make smart decisions that can help in other areas like maximising cashflow, tax payment plans etc.
A business that goes into insolvency when it can no longer pay its debts, this type of financial difficulty normally requires the help of an insolvency accountant. Very quickly they can identify assets that can be sold, renegotiate existing finances, and explain current legislation where needed. Sometimes, with the help of an insolvency accountant a business may be able to bounce back because of the expert advice they provide. This type of accountant is not only highly skilled in financial matters, but is an exceptional communicator with high emotional intelligence which helps when handling such a difficult process much easier.
Combining the skills of an accountant and a detective this type of accounting function can uncover what is referred to as ‘white collar crimes’. This normally involves detecting finance related crimes like fraud and embezzlement by discovering financial irregularities. You will find this type of accountant works in public accounting and consulting firms, law firms, law enforcement agencies, and even insurance companies. It requires extremely high levels of detail and written communication as their outputs can be used as evidence in a court of law.
In some situations it might make sense to engage a management accountants to analyse the financial position of an organisation and how it could be improved. Their duties and responsibilities involve overseeing accounting staff, budgeting, external financial reporting, risk management, and performing profitability analysis. They won’t get involved in day to day accounting tasks, but will provide a more holistic view that can help make strategic decisions for a business.
A certified practising accountant
A certified practising accountant (CPA) delivers a very high level of professional competence with soundness in depth, breadth and quality of accountancy knowledge. CPAs are highly sought after by business owners because it is an internationally recognised qualification that is backed by specialist training as well as continued professional development.
A CPA can provide advice on both audit and tax issues in Sydney. These professionals are qualified and licensed to provide a range of financial services, including tax planning, compliance, and audit management for a business. Our CPA can assist clients in navigating complex tax regulations, preparing tax returns, and providing audit services to ensure compliance with financial reporting standards.
A CPA is regarded as one of the most trusted professionals in Australia because of their ability to provide assistance for accounting, taxation, and financial management. They are trained to provide accurate financial advice and ensure that businesses or individuals comply with tax laws and regulations. In Australia, CPAs are regulated by the professional body, CPA Australia, which ensures that they adhere to strict ethical and professional standards which is why they are used to manage tax & audit related situations for business owners.
Is engaging a CPA for audit and tax issues a good idea for a business owner?
If you are a business owner seeking the most comprehensive accounting service available in Sydney, then choosing to work with a CPA will provide that. A CPA has a much broader, deeper and more extensive knowledge and set of skills vs an accountant. Therefore they can get even more involved in what needs to be done in your business to minimise tax liabilities, manage any audit requirements and plan for long term financial goals.
While many people in Australia see a CPA as a tax expert they can provide many other strategically beneficial services that can help any size business. This includes audits to facilitate smart strategic decisions, managing an ATO audit request, deeply analysing ways to minimise tax liabilities, facilitate the planning needed for business expansion, securing business finance for new equipment and more.
CPA’s have such extensive training together with ongoing development across all aspects of modern accounting practices for small or medium business. A CPA can seamlessly weave your tax planning, business management and long term financial planning into a strategically sensible plan to achieve your long term monetary goals.
Accountants that can help deal with the ATO
Fitzpatrick and Robinson can make it very straight forward to deal with any requirements from the ATO if you are a business owner. With a team that is made up of experienced bookkeepers, accountants, business tax accountants and a CPA we can assign the right level of resources to suit your situation. Some of the most common things we get asked by business owners to assist with are;
- Determining the tax deductibility of certain business expenses
- Getting help to set up a suitable tax planning strategy
- Working out how to best manage instant asset write off opportunities
- Putting in place the right payroll tax processes
- Getting explanations or advice on ATO correspondence received by the business owner
- Putting in place payment plans for outstanding tax payments or managing defaults
- Managing an ATO audit
- Getting general tax advise & implementing strategies to minimise what you have to pay
Examples financial audits in Sydney we have completed
- Solicitor trust account audit
One of the basic requirements that resulted from our audit was a new requirement for the Bank Reconciliations to be done monthly. This is then agreed to the client ledger to ensure all monies are accounted for. In this instance what was previously happening was the monthly bank reconciliations were being forged to agree to the client ledger.
What our tax accountants discovered was the business started to lose money which was due to the owner borrowing from the trust account. He was hoping for the big payday that never came.
- Audits for licensed clubs
A licensed club was rewarding members with vouchers for various things which included lucky draws, bingo prizes for competitions and other club based activities. These vouchers could then be claimed as cash or for a credit to purchase drinks, food and other things within the premises. There was a wide array of denominations available with vouchers that ranged from $5 to $20 in value.
Although, there was no actual tracking placed on them or log being kept of their usage. The members were not even required to sign off once they had collected them and this meant it was a very ‘lose’ form of currency being created that could easily be manipulated. The amounts seemed quite small but our auditors conducted an investigation which discovered that the manager of the club was falsely lodging the vouchers and claiming the cash.
The amount of fraud amounted to in excess of $40,000 and this is a good example of how seemingly small things can quickly add up to large amounts of revenue, profit or cash being taken from a business without anybody realising.
- Audit for real estate agent
Many years ago tenants would walk into the local real estate agent to pay their rent. The Property Manager was actually taking some of this money. What this person did was wait until the tenants came in to pay their rent, they would take small amounts and then try and make up for the shortfall via other banking transactions.
Without manually keeping track of what is being taken, put back and understanding the shortfall it makes it hard to keep up over time. Eventually this staff member was fired for other performance issues. Although by then they had forgotten really how much had been taken or how much needed to be made up.
A financial audit was carried out and it was discovered to be $8,500 in missing money from the business. Needless to say the real estate agent soon changed their processes and it became compulsory to pay via direct debit. Moving to electronic accounting processes meant they could easily record any transaction, keep very clear records and using cloud accounting software the information can be easily shared to process BAS payments, annual tax returns and other financial auditing requirements.