In terms of company accounting, under the provisions of Chapter 622 of the Companies Ordinance in Hong Kong, directors are required to prepare annual accounts for the company and keep the company's accounting records.
Accounting is a profession, and a lack of professional accounting knowledge can make accounting work more time-consuming and even increase the risk of errors, which may ultimately result in higher audit fees or fines from the Inland Revenue Department. If the day-to-day accounting work can be done well, it can not only reduce annual audit costs, but also help management to clearly understand the financial status of the company, so that they can make better business decisions and plan future directions.
Accounting work includes the preparation of financial statements, from simple bank entry and exit records to complex accounts receivable, payroll, MPF, etc., all of which take a lot of time and require some accounting knowledge.
Many small and medium sized businesses or start-ups may not be able to employ full-time accounting staff due to resource constraints. They may not have the time to do the accounting work, or they may not have the relevant professional accounting knowledge, so they choose to outsource the company's accounting to professional accounting companies. This not only saves a lot of time, but also reduces the risk of errors and hassle.