How to Choose an Accountant for Your Small Business
By Dan Boudreau
With my accountant on the brink of retirement, I’m moved to contemplate the critical role he’s played in my business for almost 3 decades, and to reflect on what an amazing and positive relationship it’s been. I lucked out.
Back in the early ‘80’s I didn’t have criteria for selecting an accountant. My hiring decision was based mostly on finding someone who was familiar with the accounting software package I was using. Had I known I was navigating the initial stages of a long-term working relationship, I may have considered a few other things as well.
While entrepreneurs tend to consider accountants a cost of doing business, good ones will actually save you a lot of money while keeping you on the right side of the law as you weave your way through the escalating gallimaufry of tax laws.
What should you look for when selecting an accountant? Here are a few important considerations.
- Experience. Does the accountant have experience with your type of business? The business world is complicated, leaning more and more toward specialization. Ideally, you want an accountant that understands the nuances of your business, as well as the broader industry in which it operates.
- Taxation. How current is the accountant on tax issues in general, and specifically for your business? It takes years of formal education to become an accountant, and an endless string of updates and workshops to stay on top of the continuous change.
- Technology. What software does the accountant use? Although many options exist on the market, most of the small business owners I work with use either Simply Accounting or Quicken. I’ve used both and prefer Simply Accounting for its ease of use and clarity. The choice of software is less of an issue if you’re relying on the accountant to produce all of the financial reports for you, but more important if you’re planning to roll up your sleeves and use the application yourself.
- Personal Chemistry. Do you get along with him or her generally? You’ll be spending some time together, so you may as well work with someone you enjoy.
- Costs. What are his rates for accounting, and is there a different rate for bookkeeping if it’s included as a service? What are the annual accounting and bookkeeping costs? How much will it cost to set up your initial chart of accounts?
As a small business owner, I would opt to use an accountant who is affiliated with one or more of the recognized Associations. In my view, the accounting profession does a lot to ensure maintenance of ethical and professional standards. In spite of these efforts, some major accounting firms have gone down in flames in recent years, inviting even more focus on transparency and best practices. As a small business person, you want to know that your accountant works according to the laws of the jurisdictions you operate in and that he or she keeps pace with the continuous change.
As with initiating any significant working relationship these days, you can’t go too far wrong by asking for references and making a few calls to see what others in your industry are saying. A couple phone calls up front might just save you a whole lot of heartache later.
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