When running a small business, one of the most important supplier relationships may be with your accountant. This is because they deal with your Companies House and tax issues on your behalf of course, but also because you rely heavily on the advice they should give you to help you to manage and develop your business. If you are looking for an accountant, how do you know what firm is right for you? If you have an existing relationship, shouldn't you at least consider whether it is still right for you? Here are some of the factors to think about.
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Good Advice Needed?[/caption]
Where can I find a Small Business Accountant?
The first issue is often where do you find 'a good accountant'. Of course the web provides us with a huge list of options, but how do you know who is a the right firm? The first place people often start is to ask for a recommendation from a friend or family member, particularly if they are in business themselves or work in a financial industry.
There are also some websites which purport to provide reviews of accountants, although these are not that common in the industry.
More commonly than not though, people use a Google search to identify a list of possible firms, based on a search term either relating to their location (such as "London accountants") or based on their industry ("recruitment agency accountants "). Finally, individuals search based on their need at that particular time, "tax advice" or "business plan writer".
So once you have the list of options, how do you make a decision? Who is right for you?
Should I ensure there is Professional Regulation?
Undoubtedly, one thing to check is that the firm you are considering are part of one of the regulated bodies. After all, anyone can set up a business today and say they are "an accountant". Look for firms who are Chartered or Certified, since this indicates a regulator is in place, be it the ICAEW, ACCA, CIOT
Professional regulation does not of course mean that the accountant is necessarily a perfect fit for your business, but at least means that a certain level of regulation is in place, the accountant has relevant training, insurance, qualifications and adheres to professional standards.
Is Industry Knowledge Important?
Whilst many businesses have similar needs from an accountant, the industry of your business is very different to the next. Choosing an accountant who understands your industry and may have other clients in that industry can be helpful. It often will mean that the accountant needs less background information, is more aware of changes which affect the industry and they may have a good network of connections which could benefit your business.
Is Size an Issue?
The size of the firm of accountants you use is normally not that important, except in extreme cases. In fact, usually it is the expertise and fee associated with larger firms of accountants, rather than their physical size which may mean they are less suitable for small businesses.
Sole practitioners are very common and as one might expect, their relatively low fees mean that they are often attractive for small businesses. There can be some draw backs for using a sole practitioner, such as a period where no support is available (when the individual is on holiday or sick) or a lack of specialist skills in some cases.
Generally therefore, the size of firms can vary significantly and this should not be a serious concern.
Should I Work with an Accountant 'Near' to me?
Some businesses want to work with an accountant who they can visit regularly, whether for an advice meeting, or just so they can drop off their records by hand. If this is important, then location of course needs to be considered.
Increasingly, given that most firms accept and send documents to clients electronically, communicate by email and video chat and rely less on face to face meetings, the requirement to choose an accountant near to you is greatly reduced. Of course there will always be times when you need to meet with an accountant and doing so in person might still be easiest. However businesses with an accountant 'around the corner' are now less and less common.
Do I Need Expertise?
Most businesses need a combination of services from an accountant, but most fall into either "compliance" or "advice" although the line is often blurred. Compliance services basically refers to things that need to be completed by law and involves 'paperwork'. This tends to include accounts, tax returns, VAT returns, Companies House forms and payroll
. Advice can cover a much wider range of areas including business strategy, tax planning, investment advice or fundraising.
Inevitably, all businesses and business owners need advice at some stage. It is therefore best to ensure that you work with an accountant who has sufficient experience, or a team around them to provide the advice you need. This often needs the help of a specialist, such as a Chartered Tax Adviser, Chartered Company Secretary or Independent Financial Adviser.
It is of course possible to work with a range of specialists working independently, but this will often mean it may be harder or more costly, simply because you have to replicate the provision of information.
Therefore selecting an accountancy firm with this type of coverage is likely to provide the level of support you need.
The Importance of Relationships
Most small businesses rely on having a good personal relationship with their customers and suppliers. The relationship with your accountant is no different. It is therefore important that you work with an accountant who you can get on with, who operates in the way you prefer and who you feel you can trust.
When selecting an accountant, there are many factors to take into account and many possible options available to you. Speaking to friends, colleagues or connections is a good place to start. Also, preparing a list of questions may also help before you meet with an accountant. Finally, you always have the option of consulting the Institute of Chartered Accountants in England & Wales
(or respectively in Scotland or Northern Island) for more advice and support.
When was the last time you considered whether you are with the right accountant? If you aren't sure that you are, take a look at our services