Friday 24 February 2017

Finance Fridays – Choosing the right accountant

We were talking about ways to get money quick for last week's Finance Fridays. This week we are looking at how to choose the right accountant. When you first start out as self-employed or set up a small business you may be able to do your own accounts. As your business grows this can be very time consuming and you may find yourself missing deadlines and not claiming all the payments and expenses you are due. When this time arrives you need to find an accountant that suits your needs but with so many to choose from where do you start? Whether you need to find your first accountant or wanting to change your current one here's some tips to picking the right one.

Specialist in your business type – You could be a sole trader or running a small limited company so having an accountant that deals mainly with big businesses may not be best for you. Tax in particular is a very complicated area and the rules vary widely depending on how your business is registered with HMRC. Most people who go self-employed or start a small business are doing it for the first time so have very little experience in accountancy matters. A specialist accountant will know exactly what you should be recording and the deadlines you need to comply with.

Check they're qualified – Many people have good bookkeeping skills but they aren't professional accountants. A qualified accountant will keep up to date with all current rules, regulations and legislation. Membership of professional accountancy bodies means they have to adhere to certain standards and have professional indemnity insurance. This means any losses you incur due to their bad advice they will be covered for. Look out for qualifications from the The Institute of Chartered Accountants in England and Wales (ICAEW) or Association of Certified Chartered Accountants (ACCA).

Be clear on fees – Before you engage the services of an accountant find out how much they charge. Do they have an hourly fee or a flat charge for each service? They may have a set monthly fee depending on how you use them. Whatever the fee structure make sure you know what it is going to cost before you are landed with unexpected bill.

Word of mouth – With so many accountants to choose from ask trusted friends or other business owners who they use. Most people will be happy to say which accountants they would or wouldn't recommend.

Going digital – Gone are the days of paper accounting with bank statements, receipts and invoices. You also don't necessarily need to be meeting your accountant face-to-face on a regular basis. Accountants can now work in conjunction with their clients using 'cloud accounting'. This is where your accounts can be accessed online and updated with all transactions, bank accounts, invoices and even payroll. Your accountant can then log on whenever required and spot any problems you may not have noticed or give advice on how you can change things.

Share your ambitions – You may think that accountants are just there to keep your books in order. Ask any potential accountants what they can do to expand or grow your business. They should be able to help with finding funding schemes and ways to raise capital if required.

Have you ever had an accountant? Would you know how to choose one?

This is a collaborative post.

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Finance Fridays

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