Author: an

11 Dec

Why is accounting important for small and medium businesses?

Accounting is important for every company. The first thing that comes to mind for most business people in response to this question is that the need for accounting is spelled out in the law. Indeed, the law obliges all organizations to keep records and submit financial statements to the tax and statistical authorities. The tax, criminal, and administrative codes provide for severe sanctions for violations in this area.

Accounting is important in all kinds of business. Without accounting, it is impossible to:

  • Pay dividends. They can be paid only from net profit, which must be confirmed by accounting records;
  • Get a bank loan. Financial statements are included in the list of mandatory documents for obtaining a mortgage;
  • Attract investors. They need to analyze the investment attractiveness of the company based on accounting data and reports.