How to Choose an Accountant

Is your small business caught up in tax filings and financial reports? Or is the tax year confining you to reach financial goals for the next quarter?

If these questions are in your head, it’s time to start working with professionals. A small business accountant has all the expertise to steer you through hidden deductions and pesky forms and give you sound advice on projections and planning. 

A study from Zippia indicates that 82% of businesses in the UK fail. This crash is caused by poor cash flow management, emphasising professional financial guidance’s importance. 

But how do you choose the right accountant for your small business? This article is your go-to guide to choosing an accountant.

1. Understanding Your Accounting Needs 

You must know what you are looking for. To narrow down your accounting requirements, assess your business’s size and complexity. 

For example, if you are a medium-sized business, just bookkeeping and tax preparation won’t cut it. You need accounting integrations, tax preparation and much more. Your  accounting needs can consist of:

• Basic bookkeeping
• Tax Preparation
• Financial reporting
• Compliance regulations

Also, determine if you prefer outsourced, part-time, or dedicated accounting services.

2. Is Accountant Affiliations Important?

An accountant with the correct affiliation can enhance credibility and trust, adhering your accounts to high professional standards. While also providing a network of resources, benefiting with up-to-date knowledge.

Once you know the accounting needs of your business, you can determine which affiliation you need for the chosen service. For example:

• HMRC Agent
• CA (Chartered Accountant)
• CMA (Certified Management Accountant)
• ICAEW (Institute of Chartered Accountants in England and Wales)
• CIPFA (Chartered Institute of Public Finance and Accountancy)
• CIMA (Chartered Institute of Management Accountants)

Each affiliation fits its objective in business accounting. For example, the HMRC agent is suited for tax-related services, while a CMA is for strategic and organised financial data.

3. Does The Accountant’s Location Matter To You?

There were times when location was considered an important factor in choosing an accountant. But now, companies use cloud accounting for collaborations and to view real-time changes. 

Still, it all comes down to what suits your company the best. If you’re happy to connect via video conference, emails, and phone calls, you could be sitting in Sydney while your accounts are being handled in the UK. 

4. Look For Testimonials/Client reviews

A good accountant leaves a trail for positive client reviews and testimonials. Research your potential accountant’s track record and reputation through reviews and client testimonials. Sites like Trustpilot, Reddit, and Facebook are good sources. Or the accountant can provide you with references for client reviews. 

Look for any legal actions or complaints filed against your candidate. A reputable background and feedback show an accountant’s reliability and trustworthiness.

5. Inquire About Accounting Fee Structure

Before choosing an account, know that fees can vary depending on the services, experience, and location. Here is a generalised hourly flat rate for different accounting services in the UK.

Hourly Rates: This is common for smaller, more sporadic tasks.

Flat Fees are for services like annual tax preparation or monthly bookkeeping. Flat fees vary based on the size of your company, type of company, services, annual turnover, and monthly transactions. 

Ask your chosen accountants to provide a detailed fee structure that outlines the fees associated with their services. This could have details about:

• Scope of Services
• Additional Costs
• Payment Terms

6. Advanced implementation of Accounting Software

This is the age of digitised accounting, and your chosen accountant should know innovative ways to utilise accounting software. Ask about:

• Reduced manual resources
• Real-time data integration and automation
• Offer encrypted and secure backups.
• Automatically handle region-specific tax calculations and VAT/GST filings
• Offers remote access to manage accounts

7. See If You Get a Dedicated Accountant

When choosing an accountant, you must know who will handle your finances. Will it be a one-dedicated or a rotating team? 

A dedicated accountant will give your business a personalised attention and consistent advice. While a rotating team will have knowledge gaps, leading to conflicting financial strategies. Here’s what you should expect:

• Personal Point of Contact
• Availability for regular consultation and urgent queries
• Consistency for working long-term 
• Proactive communication with regular updates and tax deadlines

Securing a dedicated accountant ensures consistency in your financial management and allows you to gain tailored advice suited to your business’s unique needs.

8. Inquire About Response Time

Once you are in contact with an accountant, you don’t want to wait for hours to resolve a query, especially when pressing matters like tax season. Timely communication can make a big difference; ask your accountant about the following:

• Preferred Communication Channels
• Working Hours
• Expected Response Time
• Urgency Protocols
• Frequency of Check-ins

8. Service Level Agreement (SLA)

 

A Service Level Agreement, or SLA, is a written commitment between the client and the service provider. The agreement addresses critical parts of the service. Your Service-Based SLA should have components like these:

• Scope of services
• Availability
• Performance metrics
• Pricing structure
• Dispute resolution
• Goals

When signing an SLA, ensure your accountant is not in any binding contract with another client. 

Choose An Accountant

Once you have narrowed your needs, discuss them with your potential accountant. This discussion ensures you have the same business goals and work styles. 

How does your chosen accountant support your goals, or what will she bring to the business? While discussing, clear all your thoughts about the following:

• Experience working with businesses in your industry
• Proactive Financial Strategy 
• Compatibility with Accounting Software
• Discuss how often you’ll be in touch and through what channels
• Go over the fee structure again in detail
• Talk about their vision for your business’s financial future

We at More Than Accountants encourage detailed discussions with our clients and gather as much information as possible to provide a sound accounting plan and quote for accounting.