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How To Choose An Accountant For Your Business

By March 18, 2014 No Comments
How To Choose An Accountant For Your Business

choosing the right accountantIt’s one of the most important decisions you’re ever likely to make. You hope to have many happy years together. It’s not something to be embarked upon lightly. And making the wrong choice could not just lead to trauma, but be ruinously expensive.

We’re not talking about finding the perfect marriage partner, though, for small and growing businesses, it’s almost as crucial. The fact is that behind any great business is a good accountant – though the challenge is finding the right one.

There are some key questions that you should ask when you’re starting out to make your choice:


Amazing though it sounds, anyone can call themselves an accountant and advertise themselves as such. But any sensible business owner will steer clear of a bean-counter who isn’t a member of one of the recognised professional bodies.  These include the Chartered Institute of Management Accountants, the Institute of Chartered Accountants – which embraces the Institute of Chartered Accountants in England and Wales and its sister organisation in Scotland – plus the Association of Chartered Certified Accountants.

At this point, some money-minded business owners will be thinking it may be cheaper to go with a friend’s recommendation of a cheap and cheerful number-cruncher, rather than seeking out someone affiliated to a professional group. But they’d be mistaken. Quite simply, going through these official channels means that the person you choose will at least be properly trained and will have had to prove that they are competent.  And, just as important, if something goes drastically wrong – most commonly errors in dealing with HMRC – you’ll have some redress. The professional bodies hold their members to account if they make a serious mistake. If the worst came to the worst and you sued your accountant because their incompetence had cost you money, a practitioner who is a member of one of the professional organisations will have indemnity insurance. This should give you confidence that the money is there to meet a successful claim.


There is the obvious question of how much you’re going to have to spend to retain your accountant’s services.  As in all purchasing decisions, the cheapest option is not necessarily the best value. However, on top of that, any business owner will want some idea in advance of how much an accountant is likely to cost over the year. Try to pin this down before you commit yourself to a working relationship.

Of course, you’ll have to give any professional a reasonably clear idea of what your requirements are likely to be.  Do you simply want an accountant to deal with your tax affairs at the end of the financial year?  Or will you be looking to him or her to give regular help and advice? In either case, you should settle a fixed fee – possibly with some limited room for manoeuvre if your needs or circumstances change – before agreeing to take someone on. That should avoid a nasty surprise when your bill arrives. Next, you’ll need to decide how you’re going to pay for whatever service you require. You may be happy to wait until you receive an invoice at the end of the year.  On the other hand, you could opt to pay a regular monthly sum.


Crucially, you should be looking for an accountant whose approach and expertise marries well with the size and style of your business. As the owner of an SME, you don’t need an accountant who’s used to dealing with multinationals. Hiring someone with that kind of experience may seem impressive, but in all likelihood it’ll be expensive and your operation would receive scant attention in comparison with larger clients. Instead, you want someone who is happy to engage with your enterprise and who is familiar with the sort of issues that typically face smaller companies. Equally, if your business has grown markedly in recent years, ask yourself if your existing accountant still has the type of experience and skills your growing company demands. It may be sad to do it, but it may be time to find a new adviser for the sake of your enterprise’s health.


Ask yourself whether you would prefer someone who is newly qualified or, instead, an accountant with years of experience. The ACCA website includes useful advice on how to make your choice when recruiting someone for an in-house accounting role, but the questions you need to ask in that instance will also serve you well when selecting an external accountant.

You may want to look for someone who is well-established and has already had to deal with the sort of problems and challenges you’re now facing. But don’t write off an accountant just because he or she is inexperienced. Someone who’s newly qualified will have recently passed exams, so should have up-to-date technical knowledge. Also, what is lacking in experience is often more than made up for by enthusiasm.


Don’t forget that your newly-recruited accountant is there for you to use, both in terms of financial expertise and business advice. These highly trained professionals have many skills that you should exploit to the maximum.  ACCA gives a useful check-list that should help you make the most of this potential resource.

Your accountant should be able to do far more than tidy up your books and prepare a tax return. A good practitioner should be proactive in the following:

  • Helping you to plan
  • Giving early warning of problems ahead
  • Preparing cashflow forecasts and business plans
  • Advising on fund-raising
  • Identifying ways your business can take advantage of tax breaks when they become available

This last point is crucial if there is even the remotest possibility that you will want to sell your business further down the line. Your accountant should be able to help structure a deal in a way that will minimise the tax liability on disposal of the operation.

The Relationship

Above all, remember that you need to feel comfortable dealing with the person you choose to handle your accountancy issues. Put bluntly, do you like the person on the other side of the desk or on the other end of a phone? This is someone upon whom you will rely for a great deal of professional knowledge and advice, and the relationship is likely to be a long one. Chemistry is very important.

Nigel Hastilow, director enterprise at the ICAEW comments: “It’s not just about technical expertise. It’s also about having a good relationship with the person. It’s probably worth interviewing a few people, explaining what you want from them, and then getting a feel for whether you click.”

He points out that a good accountant can be a lifeline to small business owners who are caught up in the day-to-day struggle of running their company. Hastilow adds: “Someone with a business manufacturing something might be brilliant at making that particular product. But it doesn’t mean they’re brilliant at running a business. We find that small businesses are very often reluctant to ask for help. That’s where a good accountant can make all the difference.”
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