Hiring an accountant is an important step, so it is crucial that you get the right match for your business needs. Below we provide you with our top tips on what to look for when hiring an accountant.
Carefully researching your options to find the best accountant now will ensure that as your business prospers and grows – which it probably will do with a good accountant on board – you won’t have to go hunting for an accountant ever again.
No matter the size of your business, a good accountant will be able to provide sound business advice about growth and development, as well as information on how to manage your finances efficiently.
Therefore it is wise to seek an accountant with experience of working within your business sector; someone you know you could approach for advice, who would be able to guide you in growing your business, and with whom you can discuss things openly.
The size of accountancy firm might be something to consider too. While there are many excellent stand-alone accountants, a larger firm such as Cloudco Accountancy Group is more likely to be able to offer a range of specialist services and expertise.
Like, for example, company formation, a registered office address service, company secretary, VAT registration and returns, payroll, tax planning advice, and guidance on writing a business plan.
An experienced accountant will also be able to help you become more cost effective by assisting you in applying for business grants, reliefs, or benefits to help your business expand.
The size of firm apart, an accountancy practice that is using the latest technologies will be more likely to be able to provide any information or financial reports you request, including year-end and management accountants, immediately, at the press of a button.
5 top things to consider when choosing your accountant
There are many things to consider when choosing an accountant, but first off, a good way for you to find out more about your prospective accountant is to follow up on recommendations from colleagues, other business owners, friends and family.
A trawl of the website of a recommended accountant, or one you’re interested in finding out more about, can be a useful exercise.
For example, what does the website looks like, is it informative, does it provide you with an idea of what sectors the firm specialises in, do they have experience in dealing with contractor accounts, freelancers or small business owners, and is there a list of services?
There are so many questions you may want answers too before even considering hiring a specific accountant.
Such as, is there are resources portal? What type of fee structure do they offer? Is the individual or the firm registered with one of the accounting bodies? Are there any reviews on the website? Have you looked on social media for comments or contacted other clients for recommendations?
1. Trust and accountability
Over time, your accountant will learn just about everything there is to know about your business finances, so it is important that you trust them implicitly. Likewise, they must be able to trust that you will be open and honest with them too.
Compliance must come at the top of any business’s list of priorities, and therefore it’s probably wise to choose an accountant that is registered with a professional accountancy body and/or is a certified chartered accountant with the qualifications, knowledge, and experience to be able to manage your accounts according to professional standards.
There are many capable small business accountants that are not chartered accountants and who operate alone, but there’s no doubt about it, various people overseeing the work and performance of your accountant can provide greater security.
Plus, larger firms tend to offer more services and have a wider pool of expertise.
2. A meeting of minds
It’s all about finding the right person or company for you! You should be seeking out accounting firms that have fully qualified and well-trained accountants who are experts in managing virtually every type of business account across an array of clients from various business sectors, including yours.
Hiring an accountant that understands business is a good start – but working with an accountant who understands small businesses and your specific business sector is even better.
Therefore, it’s crucial that your prospective accountant offers you some dedicated time, whether remotely or in person, to find out about your business and what your future aims and aspirations are.
An accountant with experience in working with small businesses and who knows about business operations in general, will be of great benefit.
You want someone who will track of your finances and spot potential pitfalls within the financial structure of the business before these pitfalls become problems for the business.
3. Up-to-date knowledge
Ever-changing financial regulations and additions to those that exist may phase even the most seasoned entrepreneur or business owner, but they should not phase an accountant.
The job of an accountant is to know what the latest legislation and tax law is and to have done the planning on your behalf in advance to mitigate any issues they may cause to your business’s cash-flow, finances or tax planning targets.
Yet, no one can know everything – so it’s also important that if you ask a question to which your accountant doesn’t know the answer, that they will be humble enough to admit it, yet capable enough to find out and implement it effectively on your behalf.
4. Digital infrastructure
Technology has transformed how accountants deliver their services.
So an accountant that uses the most up-to-date software, which corresponds to the real-time data demands of modern business accounting, is essential if you want to grow and ensure your financial information and accounts are up to date.
5. Value for money
We’d say: don’t stint on your accountancy fees; remember that they are fully tax-deductible and it’s a false economy to try to cut costs in this vital area of your business infrastructure.
The fees charged by your accountant may well be less than the sums they save you, simply by minimising your tax liability and suggesting how to make your business run more efficiently.
But the fees you will pay your accountant will be determined by factors, including:
- Your annual turnover
- Whether you need other services like payroll or VAT
- How regularly you need to use their services
- The complexity of your business finances and accounts
- Whether you want your accountant to look after your personal and business finances
It is vital to choose an accountant based on the quality of the overall service, and to discuss which services need to be included so that you can agree what you will be paying on a regular basis.
Chartered vs non-Chartered accountants
Regardless of your requirements, chartered accountants are more expensive than accountants.
The key difference between non-chartered and chartered accountants, is that a chartered accountant is typically more highly qualified and experienced, and will definitely be a member of a professional body.
The title “accountant” can be held by someone who doesn’t hold any specific qualifications. An accountant may have studied accountancy at foundation level through the Association of Accounting Technicians (AAT), or have gained their knowledge via a law degree or through years of professional experience.
They too must adhere to the Financial Reporting Council’s (FRC) Corporate Governance and Stewardship Codes, but may not have passed all the exams that the title “chartered accountant” comes with.
A chartered accountant must pass a series of exams and complete three to five years’ work experience to gain professional accreditation. Once qualified, a chartered accountant can become a member of either the Association of Chartered Certified Accountants (ACCA) or the Institute of Charter Accounts in England and Wales (ICAEW).
Chartered accountants who are accredited by one of these (or other professional bodies), must hold professional indemnity insurance, which protects both you and them if unintentional errors occur. They are also bound by their chosen professional body’s ethical codes and can have their membership terminated if they do not adhere to the guidelines.
Even though your business might be seeking straightforward bookkeeping and accounting services now, if you hope to grow your business in the future you may benefit from hiring a chartered accountant now.
A more experienced accountant may actually help your business grow more quickly, and you will only need to pay for basic accounting services while your business accounting needs are minimal.
But, the benefit you will have is that in order to have access to more complex or specialised services as you need them, will not require a change in accounting firm later down the line.
Should I look for a specialised accounting firm?
Most qualified accountants will be able to provide expert accounting services, but if you’re a small business, a sole trader, contractor or a freelancer, hiring an accountant working within a specialist accountancy firm is probably better.
For a start, a larger firm will have multiple accountants of whom one or more will probably have had experience in your market sector and in dealing with your type of business structure. This is highly advantageous, for example, in relation to advising you on “disguised employment” (IR35).
Specialist accountants normally offer various packages for a fixed monthly fee. These typically include preparation of your accounts, corporation tax return, payroll, VAT, statutory tasks and telephone support, and should include a cloud-based accounting solution.
This is becoming even more important due to Making Tax Digital (MTD). The great thing about using online accounting software, is that you can submit your receipts, upload your bank statements and access real-time data as and when you need it.
Some firms have designed and built their own bookkeeping and accounting solutions, but many will be using FreeAgent or Xero combined with tools like Receipt Bank.
What are your business financial goals and objectives?
Small businesses must have some liquidity to continue operating, at least long-term. What are your financial goals and objectives?
Your business goals and objectives and the financial strategy that goes with these should be part of your business plan. A business plan is essential to guide your business: it should be tight enough so that you know where you are headed as a business, but be flexible enough that it can be tweaked to respond to a change in the market or opportunities.
Your plan should be risk assessed so that you have reserves to help in lean times or when the unexpected happens.
Your goals for your business might involve achieving an attractive profit margin, or they could be aiming at something specific, like buying a particular piece of equipment or hiring more staff.
Whether financial goals are numerical or tangible, they should be specific enough so that the business can determine whether or not the goal has been achieved.
If you have not yet written your business plan, you should: were you at some time soon to seek an investor or apply for a business loan you would definitely need one.
In this case, you could consider hiring an accountant that offers a business plan services, one that is able to guide you in how to write an expertly presented business plan or even write it for you should you chose.
Profitability and growth are surely the goals of most small businesses. Profitability means your business is earning more revenue than it spends on operating.
Business revenue includes income from sales/services, interest on investments or rental income on any property the business might own. Operating expenses include payroll, rent, materials, vehicle expense, advertising, utilities, interest payments, licenses, insurances, taxes, and so on.
Goals for growth of any small business should take account of stakeholders, such as owners or shareholders, and look to how the business can limit expenditure to achieve expansion or grow capital reserves.
An expert accountant can help your business make more profit by analysing its operating costs and looking for ways to cut expenditure. Likewise, the same accountant may be able to suggest ways to increase revenue.
One thing’s for certain: a qualified accountant with the experience and expertise will almost certainly save you money in taxes and definitely ensure that you are fully compliant.
When considering setting up a limited company or a company limited by shares, guarantee or a partnership, you should hire an accountant or accounting firm offering limited company formation services.
CloudCo Accountancy Group is a leading agent specialising in limited company formation. The firm specialises in UK limited company formation and many offshore jurisdictions.
Many accountancy firms offer a similar service, but few offer as much as CloudCo:
- Industry experience and in-depth knowledge, helping thousands of clients worldwide.
- Specialists in online limited company formation, but offering a wide range of other company formation services, like registered office address (ROA), company secretarial, articles of association, etc.
- Services that are suited to all kinds of company formation, including limited by shares, by guarantee and limited liability partnerships.
- Prompt and efficient company registration, online, and affordable business services with guaranteed banking in the UK and worldwide.
Day-to-day business accounting
CloudCo offers professional day-to-day accounting services delivered by an expert, experienced team using innovative online accounting solutions.
This means easy real-time access to your business finances, no matter where you are, but also ensures that your financial figures are always at your fingertips and your entire accounting process is streamlined. A list of our most popular services are available on our website, but if you need something not listed then don’t hesitate to ask!
Besides day-to-day accounting services, you may need business credit reports that are specifically designed to provide prompt and simple access to important business information, including turnover, accounts formation or company credit rating.
CloudCo offers so many accountancy and compliance services that all you need do is ask, and the chances are that one of team will be able to deliver in-house the expertise you need or can refer you to one of our approved suppliers.
The accountant or accounting firm you choose, whoever it may be, should offer complete peace of mind that every part of their system is secure to ensure that all your data is protected. Total compliance is the key to a successful, profit-making business, so don’t skimp on your accountant!
Hiring a professional accountant will benefit your business, but choosing the right accountant will transform it. Make sure that the accountant you hire is suitably qualified (depending on your business needs) and knows your industry or business sector.
Work out what services you need now and what you might need in the future before you meet, call or request a quote from your prospective accountant.
Most businesses these days when coming across the Cloudco Accountancy Group appreciate our fee tariff, which is designed to be totally transparent, so you don’t need to worry about any hidden surprises! This fair and explicit pricing structure reflects the way we operate as a practice.