Although governments in different countries have enforced accounting and auditing for the enterprises but such compliance is generally mandated for the companies beyond a particular ceiling. In other words smaller enterprises have a general excuse for such a practice. While relaxations in the taxation system may be useful for the smaller enterprises the need to have accounts prepared remains all the more significant for them too! In the era of going public for capacity and capital expansion the small businesses don’t want to miss the train. Consequently the practice of accounting has assumed importance in the small business segment too and the role and demand of small business accountants has shown up trends.
Clean Accounts Practice and Credit Garnering
Credit leveraging is practiced by the low volume enterprises on the basis of the performance reports that are released by them from time to time. However objectivity of the accounts statement speaks in the most desired manners for projecting the real picture of the enterprise. Small companies always try to convince resource agencies – banks and public lending institutions especially to gain access to cheaper credits for effecting expansions. Accounts helps and guide the lending agencies to judge the prospects of the any credit proposal from the smaller enterprises.
For the same reason the practice to engage small business accountants by the micro enterprises has grown. This tendency is more potent in the developing economies like India, Brazil and others because here the government encourages the micro and medium enterprises to avail credits from the public lenders. The role of accounts is therefore of a facilitator for any enterprise in general and for smaller ones in particular!