Accounting skills: A launchpad for entrepreneurial success

Leveraging accountancy skills as an entrepreneur can strengthen your grip on financial security and maximise your chances of success. It sets the foundations for a financially grounded business – a luxury that is fleeting for many young businesses due to a lack of financial education and awareness of insolvency, writes Chelsea Williams of Scotland Liquidators.

Accounting skills are the perfect companion for an aspiring entrepreneur as they provide a roadmap for building a business with strong financial roots. From equipping you with the necessary skills to regulate financial risk to training you to operate efficiently, your accounting knowledge can help you grow a business that’s financially resilient.

Earning a competitive edge through your accounting knowledge

The qualities of an accounting professional closely mirror those of an entrepreneur. Both are invested in the financial health of the company and operate at the height of efficiency to keep operating costs at a minimum. We look at how your accounting roots can give you a head start as an aspiring entrepreneur.

Financial efficiency

Armed with accounting knowledge, you can operate tax efficiently and make company finances go further. Paired with an entrepreneurial understanding of operational efficiency, this can help build a business that’s invulnerable.

Forecasting mindset

As the financial guardian of your business, you’re likely to remain one step ahead. An integral area of accounting is financial forecasting. This means you can pre-empt whether the business is likely to become cash deficient, and if it’s cash rich -where investment should be directed to grow your business.

Exposure to high-risk = high-rewards

Accounting professionals interact with high powered business owners on a day to day and therefore, exposed to a high-risk, high-return mindset. They have a front row seat from where they can overlook the successes, failures, trials, and tribulations of other business owners. This knowledge can serve as a blueprint for your own success.

Insolvency aware

As a business owner, recognising the warning signs of insolvency is essential. If the viability of the company is at threat, acting early can prevent the financial health of the business from further deteriorating and becoming insolvent.

Always evolving

The world of accounting is always evolving to keep up with changing consumer needs, technological advances, and legislative and regulatory reforms. Entrepreneur-led businesses are established with this in mind to ensure that they are highly adaptable and agile.

An eye for detail

Accountants are meticulous in the way they work which best places them to spot inefficiencies, potential tax savings and opportunities for growth. Entrepreneurs are of a similar nature and therefore, usually at the forefront of new groundbreaking developments.

Insolvency: a cliff edge for start ups

According to a PWC survey, 2024 marked the first year that the rate of startup insolvencies dropped below 50%, compared to 60% which was the average proportional percentage of startup insolvencies over the past decade.

As startups are less exposed to economic pressures, such as interest rate increases and tax hikes, they are more resilient against economic uncertainty which means higher mortality rates, provided the risk of insolvency is actively monitored.

This is where an accounting background can provide an upper hand to entrepreneurs and help establish a launchpad for entrepreneurial success.

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