How to Choose an Accountant for Your Small Business

what to look for in an accountant for small business

Small businesses look to be facing very precarious times for at least the next year. The pandemic of 2020 has brought with it serious financial uncertainty and a global recession that it will no doubt take a while to recover from.

Arguably, it is more important now than it has ever been for businesses to ensure that their finances are in order.

An accountant can help take the pressure off these processes for business owners and entrepreneurs.

Some people opt to do it themselves, but as a business grows, it might not be the best use of time and resources; business owners might find their time is better spent on their areas of specific expertise and that it is a better plan to outsource accounting concerns to a specialist.

Here are five key points you should consider when looking to engage an accountant for your small business:

Do your research

When choosing an accountant for your small business, it’s not a great idea to just go with the first result on a Google search

The biggest and most well-known firm might not be the best fit for your company. You want to look into practices whose values align with yours and that are a match for you. You need to work with somebody who understands the challenges that small businesses face.

In this respect, it might be a good idea to go with a firm that is of a similar size to your own. Apart from the fact that their prices are more likely to be in your ballpark, they are more likely to have advised similar sized business to yours.

This is something you can ask them. It is more than reasonable to ask them whether they have worked with businesses of a similar stage and size to yours.

Treat it like a recruitment process

Don’t be afraid to ask as many questions as you need. Engaging an accountant is a significant step and is not cheap, so you need to make sure that you are making a sound choice.

In addition to asking them about what other businesses they have worked for that are a similar in terms of size and stage, you can also ask them what services they can offer you now and how that might evolve as your business grows.

You can ask to meet with the person who would be looking after your accounts and be satisfied that this person understands you and the needs of your business.

How can you make your money work harder?

A good accountancy firm will be doing much more than just passively keeping an eye on accounts and making sure annual tax compliance is complete.

They should have their ear to the ground and be finding ways to maximise your income and raise capital.

They should know about the latest tax relief programmes, for example, as well as helping you to find investment, sell shares and find grants. Make sure that the accountant you engage is willing to be proactive and dynamic and not just reactive.

Find out what you are paying for

Accountants offer different levels of engagement for different needs, so don’t be afraid to ask about what the fees cover.

For example, you will want to outline when you will be in contact and they can help to manage your expectations about the level of support you are entitled to for your service level agreement.

You will want to thrash out what your preferred method and frequency of contact is. For example, some firms will prefer you to email rather than phone.

Make sure that you know who is dealing with your account on a daily basis, and make sure that they know to update you if that changes.

Cover your bases

Once you are happy with your choice, you have discussed your needs and are confident that you understand each other, the accountant should be sending you an engagement letter.

This will put the service level agreement into writing and you will be able to go back and refer to this letter should any disagreements arise. The engagement letter clarifies that you are both on the same page and understand what you need from each other in order to make a success of this partnership.

Alongside this engagement letter, reputable accountants should also show you a copy of their practising certificate and any insurance documentation such as public liability insurance or public indemnity insurance.

A governing body such as ACCA or the ICAEW provide certificates and insurance to their members, so make sure you have done your homework and that you see these documents before you sign anything .

You might be cautious about committing to another financial outlay in these uncertain times, but if you have had a look at your finances, you might find that engaging an accountant is a sound financial investment for the long term.

About the author

This article has been written exclusively for ByteStart by Hasib Howlader, a Chartered Accountant, Chartered Tax Adviser and Director of Howlader & Co. With over 15 years’ experience, Hasib specialises in tax advice but the breadth of his specialisms, as well as his business experience, makes him extremely valuable across a variety of financial matters.

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