It is not unusual for new business owners to manage their accounts themselves in an attempt to cut costs. But when it comes to minimising your tax bill, an accountant can really pay their way. Entrepreneurs need to understand that an accountant can offer them a lot more than tax return compilation.
Ideally, accountants should be involved year long so that they can advise the business with respect to practices that will lead to lean tax returns. They can also help with internal controls and financing decisions. Hence, the accountant you choose should be the right fit for your business. Following are the three major questions you can ask yourself when choosing an accountant.
1. What kind of a client base does he have?
Understand that though laws may be the same, the scale of a business largely determines the decisions that will help it sail smoothly. The accountant you hire should have worked for small businesses before. It is all the more better if he has experience of working with a firm that operates in an industry similar to yours. Finally, his client base can potentially be yours in the future! There is always the possibility that his network will include clients who can be your potential customers, partners, investors or suppliers.
2. Who has vouched for him?
Accountants are usually hired based on referrals. Evaluate the trustworthiness of the referrer. You would know this if you are considering the candidate based on a suggestion from one of your own connections, but if you invited applications publicly, you can always ask the candidate for client references.
3. What will he charge you?
This is extremely important for startups. Make sure the terms he suggests reduce your debt burden instead of adding to it.
The idea is to hire someone who not only has a good reputation but is also known to deliver. Screen through your network and ask people who are in businesses similar to yours to suggest an accountant. Call four or five and interview them to see if they jive with your business. Pose hypothetical situations and ask them their course of action. Make sure that they are not only good with figures but also communicate effectively for you want to make sure they understand you and you understand them. Most importantly, he should be available when you need him. Accountants have a tendency of vanishing once hired. One way of making sure yours doesn’t belong to this category is to do proper background research and look for feedback online.
In a nutshell
- Check their qualifications and competence
- Ask about existing clients and evaluate them in terms of the business size and industry
- Evaluate reviews
- Evaluate proposed fee vs. your budget
- Check for their ability to communicate by interviewing in person
- Check for their accessibility