Your business has finally grown enough for you to consider hiring a professional accountant. Congratulations!
This means you’ve decided to invest in the growth of your business.
Managing your finances and taxes isn’t just a time-consuming affair, it’s also extremely complex and a tiny error can end up hurting your business. Financial planning, bookkeeping, and taxes need to be handled by professionals to maximize efficiency and reduce any chances of errors.
This gives you a lot of free time to focus on what truly matters: scaling your business. However, to be able to achieve this, you must hire a qualified accountant whom you can trust with your financial affairs and can bring benefits to your business.
How to choose an accountant that matches this description? In this article, we will guide you through the selection process.
Determine What Your Financial Needs Are
If the challenges of your business have become too overwhelming, it’s time to seek outside help. However, you might be unsure as to what kind of accounting services exactly you need or what accounting records you need to keep. Do you need a financial professional for tax accounting or someone to manage bookkeeping for you? Perhaps you need a full-time accountant to analyze your financial data, handle all aspects of accounting, and help you make informed decisions?
In-house accountants typically handle:
- daily transactions
- preparing financial statements
- analyzing financial data
- bank reconciliations
How much help do you require exactly?
Small businesses rarely hire full-time accountants because the volume of the work simply doesn’t require that. Hiring someone full-time or part-time would thus be an unnecessary expense.
That is why many companies chose using accounting or tax software. It’s much more cost-effective and it’s great for automating simple bookkeeping tasks. Cloud technology increases the visibility of your accounts and boosts the performance of your business. Accounting software also enables you to access your financial information from anywhere in the world so it’s very convenient.
But keep in mind that accounting or tax software won’t provide the much-needed guidance for navigating your finances. While it is very practical and affordable, you have to analyze your situation and decide whether that’s the best course of action for you.
On the other hand, hiring an accounting firm on a consulting basis is a great idea. You’d have someone to guide you through the financial aspect of your business, prepare your financial statements, and handle your taxes, but without having to pay a full-time salary.
Ask for a Referral
Whenever we’re looking for a service, the first thing we usually do is ask our friends, family members, and acquaintances for a referral. Or we google it. But the point is, having someone recommend a reliable professional is vital for all of us. It gives us a sense of security and it also helps us build trust.
If you are looking for an accountant, whether full-time or on a consulting basis, you should ask around if anyone close to you knows a good accountant or accounting firm to recommend.
But don’t just take someone’s word for granted. Just because a friend recommended a financial expert doesn’t mean you don’t need to look elsewhere. Perhaps they specialize in different types of accounting services from what you’re looking for. A referral is a good place to start but it doesn’t mean that it would be a good fit for you.
Inquire About Their Fees
Your budget is probably one of your major concerns, especially if you’re a small business owner. All the more reason to be careful when hiring a financial consultant or firm. You can’t afford to waste money.
As soon as you get a referral and set up an interview, ask about their fees. Do they charge a flat monthly fee or separately for each accounting service (bookkeeping, tax preparation, etc)?
Additionally, fees differ from one accounting firm to another, and the type of services they provide has an impact on that. Also, the qualifications that accountants have may impact the cost of their services.
Highly-skilled, licensed professionals may charge a higher fee when compared to an uncertified accountant.
Accounting firms may charge you an hourly fee and these fees may vary depending on the service the firm provides as well as its complexity.
Hiring someone to join your team is an investment in your business and you should, therefore, take into consideration all the aspects of this investment. You should know what you’re paying for.
Check Their Professional Background and References
Hiring an accounting firm can do wonders for your business. But it could also be a fatal mistake if you hire the wrong one. This person would have access to all your financial information and records so you can’t afford to hurry the process of hiring an accountant.
That is why you must interview the potential company or individual and inquire about their references and professional background.
Do they have the necessary qualifications? Have they obtained their accountancy certification?
An accountancy certificate proves an accountant has passed the relevant exams. Furthermore, it means they will have to continue taking various courses and educating themselves in order to keep their qualifications.
Additionally, you should check whether they have experience in your industry. If you’re a small business owner, you should inquire about their previous experiences with small businesses. If you’re interviewing an accounting firm, ask whether they’ve had clients like you before (industry and size of your business).
Many accounting firms specialize in a field (non-profit organizations, retail industry, pharmaceuticals, etc). If you’re a retail business owner, you would probably not go for an accounting firm specializing in the automotive industry, would you?
Remember that you’re hiring someone to help you grow your business and this requires experience, skills, and dedication. That is why you should take your time when choosing an accountant.
In this post from SCK Group, you can see the various services accounting firms offer. If you need someone to prepare your taxes or you require some financial guidance and planning, you can hire an accounting firm to help you.