Top tips for choosing an accountant

A good accountant will not only handle your financial and operational data but will offer professional business advice on a number of other topics too, leaving you free to focus on maintaining and expanding your business.

Did you know that according to government statistics, businesses with 1 to 9 employees are more likely to turn to an accountant for help with employment law than any other type of professional advisor?

1. Identify the areas where you need support and what you will need your accountant to do

Consider the complexity of your accounting needs. Evaluate whether it is just end-of-year financial statements and tax returns that you will need guidance on, or if you will require support throughout the year. Also try to foresee any future requirements you might have, especially with regard to raising external finance, and consider whether your accountant is equipped to deal with these.

2. Big is not always better – look for a good match

Smaller accountancy firms can often be better suited to smaller businesses. An accountant running a small practice is a business owner just like you; they know what it’s like. Consider also your personal needs and preferences. Would you prefer to work with one person on a day-to-day basis (typical of smaller firms) or would you feel more comfortable knowing there is a larger team dedicated to your account?

3. Make sure that the accountant has previous experience working in your sector

This is not essential, but experience working in your sector or a similar one will be a good indicator of the accountant’s suitability and suggest they have some good business insight into your area of speciality, which may prove invaluable. Contacts in your sector are also a big plus; many businesses have been able to source valuable customers or suppliers through the network of a trusted accountant – at no extra charge!

4. Arrange to meet with a few different accountants so you can compare services and fees

As with any business or financial decision, value for money should be a key consideration when deciding between accountants.  Make sure you understand how much your potential accountant will be charging you and how and when you will be charged.

5. Consider how they can add value besides book-keeping

Your primary consideration when choosing an accountant should be the value he or she can bring to the business. Whilst their primary task is ensuring all your accounts are in order, it is their ability to deliver specialised expertise and resources that will guarantee a successful business relationship. Try to gauge how strong their network of contacts is, and whether they are able to provide services above and beyond your book-keeping needs.

6. Ensure that the accountant you choose has a professional qualification and belongs to a professional organisation

Although they are relatively rare, you may come across people offering “accounting services” who are not qualified. Unqualified accountants are unlikely to carry liability insurance and any apparent fee savings may turn out to be costly in the long run.

Accountants should display this information on their website or other promotional material. If they do not, it is essential to ask. Look for a qualification from a professional body such as ACCA, ICAEW or CIMA.

7.  Ask to speak with some of their other clients for recommendations and a first-hand account of working with the firm

Don’t underestimate the value of speaking to other businesses or acquaintances about their experiences working with an accountant. It may also prove valuable to talk to non-clients to find out their perception of the organisation.

8) Ensure the accountant is somebody you can work with – they will be a key business advisor, so a good working relationship is key

It is of utmost importance that you trust the person who will be handling your finances and feel comfortable to ask them any questions you may have. Most accountants will offer a free initial consultation, allowing you to assess how successful your working relationship might be. A breakdown in communications between you and your accountant may lead to financial confusion, hassle, and ultimately expense, to you and your business.

9. Agree fees and charges upfront, along with how and when you will pay

You should not overlook the necessity of comparing the fees of several accountants before you make your decision. It is vital that you understand how and when you will be charged and what this fee includes. For example, is advice included or will you be charged at an hourly rate for any one-off questions you may have?

During the recession, many businesses have faced cash-flow pressures and accountants have often been able to adapt their fee and charge schedules to accommodate them. If this is likely to be an issue for you, be upfront about it and you could work out a much better deal.

10. Don’t rush the decision!

An accountant is an essential advisor for any business, so investing time in choosing the right person for you is imperative in order to gain maximum value. Up-to-date payments and ordered accounts will allow you to concentrate on building your business and planning for the future.

Emmanouil Schizas, SME policy adviser, ACCA (www.uk.accaglobal.com)

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How do you get on with your accountant?  Do you have any other tips?