Picking the Right Accountant For Your Small Business
Most successful entrepreneurs have mastered the most important metric – their financials. They are so important that you should consider your financials at every step along your entrepreneurial journey from writing your business plan to starting your business and growing.
However, you’ll almost always be best served by working with a good accountant that can help you create projections, manage your books, and provide strategic advice about your financial situation. This post will give you some tips on how to find a good accountant for your business.
Get a good referral
The best way to find a good accountant for your business is to talk with other business owners. If you are not already connected to other business owners, then consider going to various networking events in your city to meet some. They can often provide the best advice on which accountants are good (or bad) and which ones are most likely to understand your business. That’s a big key because finding an accountant that is already familiar with your business model and industry can make things much easier on you.
If you can’t get a referral from a fellow business owner, consider reaching out to local organizations that might have a resource list or look for someone recommended by your accounting software provider (for example, Xero and Freshbooks both maintain directories of financial professionals).
Understand what they do
There are many different types of financial professionals out there–from Accountants to CPAs, CFOs, and more. Some offer tax preparation and filing, some offer forecasting services, and others offer strategic financial advice, among other services.
It’s not important that you understand the entire industry today, but you need to know what you are looking for. Most likely, you’ll simply need an accountant for now to help you set up your financial records. This often entails setting up your chart of accounts so you can properly track the money coming into, and going out of, your company. From there, your accountant can help to make sure you are paying your taxes properly throughout the year (sales taxes, use taxes, employment taxes, etc.). And finally, they can help you to prepare and file your taxes at the close of each tax year.
You should ask your accountant if they can do all of those things and what else they can provide. If they are not comfortable playing the role of a CFO, then you may need to seek additional financial professionals to supplement your accountant.
Understand how they charge
Many accountants simply charge hourly for their services. But more and more are offering packaged services, whether it’s a fixed monthly fee for a set package of services or a fixed fee per tax return filing.
In either event, it is important that you understand what bill you are going to get in the mail for their services so you are not caught off guard. This is especially true for hourly billers. You should always ask for estimates and, when applicable, a cap on their fees (or at least an email notice if they go over some pre-determined number of hours).
Make sure they work like you
This may be the most important tip–always interview the accountants on your short list to make sure they work like you. For example, if you prefer to do everything in the cloud, don’t hire an accountant that plans to mail you a bunch of paper. Or if you plan to manage your books day-to-day and only call on them for occasional advice, make sure they are okay with that.
Don’t stop here!
Finding a good accountant is just one of many things you have to do when starting and growing a business. If you are looking for more entrepreneurial advice, check out the Kauffman Foundation’s free FastTrac program at www.fasttrac.org where you can take online courses to learn how to become a successful entrepreneur.