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How to choose an Accountant, Bookkeeper or a Tax advisor?

Friday Oct, 02, 2020 Accounting

How to choose an Accountant, Bookkeeper or a Tax advisor?

Are you looking for an accountant, tax advisor or a bookkeeper? There are many articles on the internet advising on how to choose an accountant, top tips for finding an accountant. Still, many business owners choose an accountant who doesn’t last more than a year and is not fit for the purpose! So, what they are doing wrong?

So, in our opinion, here is a brilliant recipe for a broken relationship.

If you do any of these, the probability increases that in few months you will be on hunting for another accountant!

  1. Ignoring professional membership

Professionals including auditors, accountants, bookkeepers and tax advisors are required to hold a public practice certificate issued by a professional body, like IFA, ACCA, ICAEW and CTA. Such professional membership brings unlimited benefits, for example:

  • Members follow its professional code of conduct;
  • You have recourse available in case your accountant, tax advisor or bookkeeper is not acting professionally/ ethically;
  • Mandatory CPD requirements ensuring that professionals are up to date with any industry and regulatory changes; and
  • Finally, all professional bodies require their members in practice to hold professional indemnity insurance!
  1. Ignoring industry experience

Wherever possible, look for an accountant experienced in your industry.

It is not essential; however, value an experienced accountant working in say, the property sector will bring may not be matched with an accountant with no experience in the property sector.

  1. Ignoring online reviews

Do a google search on the accountant’s business name and look for any positive and negative reviews.

Having negative feedback in itself is not a bad thing, but understanding why it existed is essential. You can discuss it in your initial meeting with the accountant and what action they took to avoid having similar feedbacks from clients.

  1. Request only one proposal from one accountant

Very few of us purchase an item without checking the same with multiple suppliers or without visiting any comparing websites (like booking.com, hotels.com, moneysupermarket.com, confused.com, eBay, Amazon).

So why anything is different when it comes to choosing your accountants? Always request and check a few proposals to get an idea what is out there!

There is no magic number of how many proposals to solicit; however, from experience and research, we found three to be optimal.

  1. Not driven by technology

Technology has revolutionised accountancy and tax services over the last decade, and it continues to do so.

Countries from Brazil to India have plans to make taxes digital, and yes, UK too.

Remember MTD- Making Tax Digital for VAT businesses turning over £85,000 is already live.

Cloud computing has made accounting and bookkeeping on-the-go possible. There are hundreds of useful apps out there to make business intelligence available at your fingertips!

So, if an accountant is paper-based, it tells you something- they are not forward-looking, and maybe it is time to avoid them!

  1. No initial direct communication or meeting

Meet the team! I remember one of my colleagues mentioning that one of their clients insisted on meeting the accountant and every team member working on their job before signing an engagement letter.

It is good to meet the team working on a day to day basis and not just the owner. Larger practices will have a dedicated customer services manager. Such customer service manager will be your first point of contact.

  1. No chemistry

If initial interactions demonstrate signs of clash of personalities or you get a feeling that you both won’t gel, maybe it is a good idea to continue your search.

After all, you are in business to make money, so why trust your finances with someone you don’t gel?

  1. Only focused on Fees

The fee is essential and one of the critical factors in finding an accountant, bookkeeper or tax specialist; however, it is not everything.

Over the long term, excellent professionals (or they should) tend to add value to the business- both tangible and intangible. Look for value addition your Expert will bring- like tax savings, tax planning, free bookkeeping, no penalties.

  1. Hourly fees

Nothing wrong in working on an hourly basis, however over the years, I have noticed that hourly fees can open a room for arguments and unnecessary justifications.

Also, it doesn’t help budgeting or cashflow forecasts. Wherever possible, I opt for a fixed fee, defined scope of work and a new engagement letter for any additional tasks.