Deciding on and employing the right accountant or accountancy firm for your business, be it large or small, is an important decision. Not many people realise that almost anyone can set themselves up in business and advertise and label themselves as an accountant.
Here are some key factors you should consider when determining which accountant to employ if you are UK based:
Qualifications.
The qualification you need to be looking for is Chartered or a Chartered Certified Accountancy practice. (Whilst anyone can call themselves an accountant, only people who have passed rigorous professional examinations can call themselves chartered).
Chartered Accountants or Chartered Certified by passed the examinations set by the Institute of Chartered Accountants in England and Wales (ICAEW) or alternatively the Association of Chartered Certified Accountants (ACCA).
The ICAEW is the biggest professional accountancy body in the European Union with over one hundred and twenty five thousand members. The ICAEW's qualification is recognised throughout the world as a reputable business qualification. Upon passing this examination institute members can call themselves a Chartered Accountant and to use the letters ACA or FCA, which one they use depends on the amount of experience the member has and the length of membership.
ACCA offers the Chartered Certified Accountant qualification which carries with it the letters ACCA or FCCA.
Qualified accountants need to maintain their knowledge to ensure that it is up to date. Consequently members under take Continuing Professional Development or CPD for short. This is similar to other professions such as surveyors. CPD requirements normally involve so many hours each year furthering ones knowledge and can be achieved through a variety of methods including self study, attending courses or workshops. If the majority (typically 75%) of owners or partners of an accountancy firm have achieved chartered status then the firm is eligible to call itself 'Chartered Accountants' .
Whilst it is optional to use a chartered accountant for your accounts, in the UK if your company or firm has a turnover over a certain limit you will need to have your accounts audited. The auditing of your accounts however can only be done by a firm of registered auditors.
Essentially when deciding on which accountant to use you should select from a list of accountants who have professional qualifications or is from a firm labelled Chartered Accountants to adequately ensure your financial matters will be handled and supervised by fully qualified personnel.
Type of Firm
You should try to choose a type and size of accountancy practice suitable to your business. If you are a international enterprise a small regional accountancy firm is unlikely to be the correct choice. Likewise a small to medium sized enterprise (SME) with a small turnover or a start up business would probably not get the best service from an international accountancy firm.
One important factor to remember is that the firm you choose should be able to accommodate you as your business grows. So when selecting an accountancy firm choose one which has clients larger than you so that they have the experience of working with size of firms at a size which you intend to become. Also, whilst tax advice is the bread and butter of accountancy, most accountancy now offer a broad range of associated management functions and analysis to help you make informed decisions on how to structure and grow your business. These services can be of great benefit for people intending to grow their business.
The other item to check is the accountancy firms field of specialism. The major point to look for is if they are currently working for similar businesses from the same sector.
Personality
Knowledge aside for one moment, you need to get on with your accountant on a personal level. Without this it will be harder to get on with them. The best accountants will take a keen interest in your company and also in the business world in general. Remember also that your accountant is running his own business and will have had to address many of the issues and problems that you will face during the course of your daily business activities. The ability of your accountant to relate to you and to exchange information on how to deal with things will be a great asset to you and your business organisation. There will be however instances where your accountant will have to tell you that you are doing something wrong or there is something that you need to address. If you have mutual respect for each other this process will be a lot easier. Remember that your accountant will work for you as part of your team and is trying to ensure that you succeed
Technology.
Once upon a time all accounts were done by hand in ledgers. Nowadays this is almost unheard of. Also nowadays it is usual to find that many companies will keep their accounts on relatively easily to use software. What you need to check however is that your accountancy firm can accept the electronic files into their system. Also, if they require the files using a proprietor y software system is this going to entail you investing in the software to be compatible with them. Electronic document management systems are becoming more and more popular. There are also systems that allow you to store copies of your documents on remote servers which you can then grant your accountant access to. This rapidly enables the transfer of information whereas previously it might have taken days, with the benefit being your accountant can respond faster and more efficiently.
Recommendation.
Many people rely on personal recommendation when selecting an accountant. Almost every business networking group has an accountant on board because they know that the personal recommendations that come from these networking groups produce good leads. Choosing an accountant through recommendation does give you a significant amount of confidence when compared to, say, selecting an accountant from the phone book or from an advertisement on the internet. Consequently ask any friends or colleagues in business about which accountant they use 9or wouldn't use!) and the reasons for that. Also ask other professionals you come into contact with, such as bank managers or solicitors for any information they have on accountancy firms.
If you've made a decision on an accountant or accountancy firm on these five factors you should have ended up with a firm and an individual who will be able to work with you as your business expands and grows.
