What is the role of accounting firm?

what is the role of accounting firm

Accounting firms are some of the original outsources of business. If I own a store and things get hopping, which is easier to hire some new sales people or hire another bookkeeper. Hiring a firm to keep or check the books is an expense that does not pose a problem with benefits, employment taxes, worker's comp insurance, etc. Besides, the accounting firm will have a better quality of staff than the local store will want, or be able, to hire. Then there are taxes. There are also the temptations to be managerially-creative with the accounts--to which the accounting firm, as opposed to the store's employee, will be able to correctly scoff and say, "That's bull s--t, go somewhere else if you want to play those games." Accounting firms sometimes specialize. One may be employed to do the payroll, another for taxes, and still another to audit things to make sure that the whole set of books is reasonably proper. If I had an enormous store chain and hired the best of the available accountants to do things myself, the business would probably be incorporated and so I would still need to hire an accounting firm to verify (audit) for the government and stockholders that my books and taxes are reasonably correct.

They charge you a lot of money to tell you that you are going broke.

well usually only big companies or big incorporated companies uses accounting firms; it is the law to have an independant or external party to verify your accounting books. since big companies issue trading shares, they have to report to Security Exchange Comission and report their financial statement, the accounting firm makes sure that whatever you report is actually true. So the accounting firm verify and signs on the financial report telling them everything was done in accordance, using such and such standards,