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How do I find the best accountant for me?

13 June 2018

As the final article in our Business Essentials Series, we will discuss how and why you should review your accountant, and how to find the best accountant that suits your financial and business needs. A small business’s accountant should be one of the main sources of trusted advice, but too many businesses end up with tax agents who are only focused on menial tasks like preparing and lodging tax returns instead of looking ahead.

Some of the most common complaints SMEs make about their accountants are not about price but about value. They may not provide enough value based on the business’ needs and give advice which is not forward thinking enough to help them make effective decisions.

Efficiency and effective communication also play a key part when assessing value. Can you get hold of your accountant and access to advice, when and where you need it? Also, how can they enhance efficiency in your business and save you and your staff time which can be redeployed in more productive areas.

Ultimately, there is an overall lack of insight & advice to help you get what you want out of your business.

How do I know my next accountant will be any better?

Much like a job interview, ask them! Ask them to explain how they can work with you and how they can support you on the journey to get there. Ask them for examples of other clients who have similar circumstances to yours.

While considering their work is important, you must also check their listening skills. Some of the best SME advisors are expert listeners and if you don’t feel like you’re being listened to in your first conversation, it’s likely your feelings won’t change.

After your initial meeting, ask yourself ‘am I confident this adviser will help me get what I want out of my business?’

We will explore more on the relationship aspect and other areas to explore further in this article.

What’s the process of switching accountants?

Switching accountants can be relatively painless and your soon-to-be accountant will be able to explain the process for you and help you switch smoothly. However, here are the key steps to consider as part of the transition:

1. Understand where are you at with your current accountant:

Are you part way through some existing work? Are there any overdue fees owing? Try to wrap any outstanding obligations as soon as possible.

Ensure you are aware of any fixed fee agreements. Such agreements can include requirements to pay out the remaining months in a 12-month period of fees to cover off annual engagements (e.g. preparation of annual financial statements and income tax returns).

Ideally, you want everything completed and sorted before announcing the switch. It will make the process more efficient and can avoid unfortunate surprises with ‘final fees’.

2. Let your current accountant your intentions:

It’s a good idea to let your existing accountant know you are switching and its simply good practice that the first they hear of this is from their client.

The incumbent accountant will obviously want to be paid any owing fees before moving on. They may also look to hold a lien over (i.e. not release) certain records, accounting and tax information until all owing fees have been paid. Hence, completing step 1 above is important.

3. Help facilitate the changeover:

Once this has happened, you can let your new accountant know. A Chartered Accountant is required to issue a professional clearance letter to the incumbent. This is to formally request if there are any professional reasons for not accepting the engagement and if not, a request to transfer the client’s records across.

Once this letter is received by your old accountant, they have a duty to respond promptly with either the records or an explanation as to why they cannot provide the records at this time. Reasons include unpaid fees by the client.

Once this is sorted, the new accountant can proceed with their engagement letter to you (which clarifies the scope and nature of the engagement) along with changing tax agency details across and related processes.

How do I find the best accountant for me?

There are many factors you need to consider before choosing a new accountant, depending on your circumstances as well as external factors:

Are they a big firm or small boutique agency?

It depends. You need to know that the accounting services provider has sufficient resources to best service your needs now and into the future. Larger firms invest in both depth and breadth of expertise which can be critical to best support your business needs. Alternatively, smaller firms can offer niche services and continuity of relationship but will ultimately have a limit on the number of clients they can truly service well.

Where are they based and what do they specialise in?

Some accountants will argue that location is less important with today’s technology and cloud based solutions which allow for online access and collaboration. However, there are simply always going to be some matters that are better dealt with face to face. Ask yourself, how could I get my accountant to meet me when and where I really need them to?

As professionals, all accounting providers will promote professionalism and expertise in what they do. It is important to go look beyond this and substantiate how the accountant can best serve you and your specific needs.

What are the extent of their services?

It can be hard to know every service you will need at the start of a relationship with a new accountant. It is useful to understand the wider capabilities of an accounting firm and how well they can support your business needs now and into the future.

What do they charge?

As with most things, you get what you pay for. All accounting providers can give you a reasonable expectation of fees going forward. You need to ensure this is in line with your expectations and what your business can afford. Accounting service providers do operate in a competitive and tiered market to best service a wide array of businesses and their needs. Always remember too that price is only one component of the value equation: Value = Experience/Price

What is the relationship going to be like?

Arguably this is the most critical of all aspects. It is vital that you feel comfortable with your new accountant and that they are a good fit for both yourself and your business. Ask yourself, did you really feel comfortable and assured when dealing with this person? While all Chartered Accountants are bound by a duty of confidentiality, it is still very important that you feel comfortable discussing what can be at times very sensitive and personal information. Trust is important to any successful accounting and SME relationship.  All of these areas should be discussed when you ask your next accountant what you need.

I don’t want to break the news to my accountant. What do I say to them for a clean break up?

A conversation like this is all about respect. Thank them for everything they have offered you to date and how they have supported your business over a length of time.

Explain how you feel the needs of your business are better met by another firm. Putting it in terms of Value = Experience/Price can be a useful way to articulate this piece of the conversation.

At the end of the day, clients do change accountants, and no accounting service provider is immune to this. There are often good reasons for this too, like where a smaller provider has provided some excellent services to facilitate growth and the demands of the business now simply require a larger accounting resource. This is a success story really and is part of a productive evolution of business.   

If you'd like to discuss how you can apply the strategies in this article to your business, contact a BDODrive Adviser today.