Accounting can seem like a black-and-white profession. Numbers are numbers. Ten accountants should be able to assess the same financial records and come up with duplicate figures for cash flow, net income, profit and loss, sales and so on. Ditto for dealing with tax returns. Not so fast. There are “right accountants” and “wrong accountants” for your business. Here are some ideas for finding the “right” accountant for your business.
1. Clarify What You Want the Accountant to Do
Many business owners think that the purpose of an accountant is to help with taxes, balance sheets and the like—nothing more. Of course, that’s all that happens in some cases, especially for new businesses or businesses that don’t plan to grow.
However, an accountant can do so much more. For instance, having a third party do your business accounting is a way to gain perspective on your operations. The accountant can identify patterns, areas where costs can be trimmed and much more, and compile them in a report. In such a case, you probably want to interview only accountants who have experience in your industry. You may also want to consider only accountants who have the CPA designation.
This article explains the ways in which businesses can benefit from their accountants. Choose what works for your business.
2. Seek Referrals from Colleagues and Other Professionals
Explain to a few trusted colleagues or other professionals you work with that you’re looking for an accountant. You hope this person will have a, b and c credentials or be able to do x, y or z.
Your business lawyers are a good group to turn to for this type of referral. Business lawyers often work with accountants. They know who might fit well with your business.
3. Conduct Interviews
Now it’s time for interviews! Set up a small number to start with, perhaps no more than two to three candidates so you can keep the process efficient.
Discuss points such as:
- What you’re looking for in an accountant
- How the accountant tends to work with clients?
- How often the two of you will talk. What is their availability?
- If the accountant or someone else will be your main contact person
- The accountant’s fee structure
- Do they provide bookkeeping services as well as year end income tax returns?
You’ll also want to understand:
- Some of the important tax benefits of carrying on your business through a corporation (like the small business deduction or the lifetime capital gains exemption)
- How you will pay yourself from the company? Dividend or salary or some combination?
- Whether you need an HST account and/or Payroll account?
It’s also helpful to explain your business situation in general terms. Accountants will often give you some ideas during the interview on how to save money or streamline your operations. Their ideas lend insight into your business and which accountants will work best for you.
4. Pick Someone
Consider factors such as how approachable and how reachable the person is when choosing among candidates who otherwise seem equal.
5. Revisit Your Needs Periodically
Your business accounting needs may change. Your operations could outgrow your accountant, or you realize that you’d like someone different. It’s OK to change accountants as needed.
Business accounting isn’t just about a number-cruncher. It’s about finding the right mix of skills to meet the unique needs of your business. We at Ordower Law can help with the search.