10 tips on how to choose an accountant

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Published on Sunday, 16 May 2010 16:07

Written by Richard Siddle

Ten top tips for choosing an accountant by Emmanouil Schizas, SME policy adviser, ACCA, the global body for accountants

Selecting an accountant can seem a daunting task, but if you choose correctly, they can be an extremely valuable asset to your business. 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 one to 9 employees are more likely to turn to an accountant for help with employment law than any other type of professional adviser?

You will need to give your accountant detailed access to your business information, so it is crucial that you choose correctly first time. ACCA (Association of Chartered Certified Accountants) offers the following ten tips to business owners to help ensure you find the accountant that's perfectly suited for you r needs.

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 regards 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 its 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 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. A professional qualification also means your accountant will be required to learn continuously - and can be disciplined by their professional body if they fail to act professionally towards you. Professional bodies will usually have member directories available, allowing you to search for a qualified accountant near you. 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 adviser, 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 cashflow 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.

Notes to Editors
1. ACCA is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We have 362,000 students and 131,500 members in 170 countries worldwide.

2. ACCA has worked with governments, national organisations and development agencies in emerging economies- for over 20 years - promoting the accounting profession, to create value for the communities, businesses and individuals it serves.

3. ACCA believes that globalisation of business means that one set of reporting standards is essential. We favour the principles-based IFRS.

4. ACCA understands the real issues facing small businesses as 63,000 of our members work in SMEs or small partnerships worldwide.